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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: CommSatMan who wrote (4144)	4/24/1999 7:03:00 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 29987

CommSatMan, my argument for a boringly long time has been that the capacity should be sold via a 'what the market will bear' pricing strategy. Unfortunately, I have been over-ruled by the company and they are going with the method; 'sell a few special minutes to high-paying subscribers and let the rest rot in space'. So the maximum capacity is not really interesting, but we can be fairly sure that it is somewhere in the area they claim = just over 10 billion minutes per year, depending on many variables. Important capacity constraints are battery capacity and geographic spread of subscribers. We know the demographics are going to be VERY lumpy, with very few calls over the South Pacific and flat out over China and the USA. So when very busy, the satellite circuits will be full, subscribers will get busy signals and the batteries will be going flat. Batteries go flat on the dark side so if demographics and batteries go bump in the night, people will get 'no service' signals. 'Capacity' is full of assumptions. The calculations and approximations would be too complex to put in the thread and I'm sure the company doesn't want to publish the mass of detail anyway. I think we have to trust that capacity is about that much and that CDMA does work in space as claimed. I don't have any reason to doubt that the capacity is about there, but I have serious concerns that the sale of that capacity won't be optimized. Actually, they aren't concerns, I'm certain that the sale will be poorly done - I have seen nothing to say it will be anything other than 1970s type fixed, centralized, overpriced methods. Disappointing, but as good as anyone else is offering right now. Certainly cheaper and better quality than competitors. Still very profitable, just not the best. Demand is said to be 40 million subscribers, but they never say at what price! So I guess they figure, start the system, go with 55c per minute wholesale and let's see what the customers say. If Globalstar gets the raspberry, they can cut the price to boost sales. If demand is as frenetic as they expect, then they can sit right there and rake in $$billions. Rough as guts, but it'll work well enough until they can get some software algorithms loaded for variable pricing based on demand at a gateway. Maurice