Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: RMiethe who wrote (4179)	4/25/1999 9:58:00 PM
From: Goodboy	Read Replies (1) \| Respond to of 29987

Thanks for the very informative post. I would like to clarify one point where I believe you mentioned me (as Goodfellow). I am not predicting the demise of Iridium the service (although that may happen, but I doubt it). I am simply predicting that the equity will become near worthless, the bondholders will get .20 to .50 cents on the dollar, bank debt will be made whole and Motorola will own the lion's share of the company. A restructuring doesn't have to impact the service. Only in the unlikely event that no investor (including Motorola) will pony up more money after a restructuring, would the service itself be in trouble.

To: RMiethe who wrote (4179)	4/26/1999 3:57:00 AM
From: Maurice Winn	Read Replies (2) \| Respond to of 29987

"... Iridium will not be allowed to go under because of its necessity for military usage. It will be kept solvent by DoD payments,..." Iridium should not depend on that for money. The military can maintain service whatever happens to the first shareholders. If the first shareholders lose all their equity and Motorola funds operations and takes over the company, the military would still get service. So there is no need for them to give money to Dragonfly and other Iridium shareholders. The military might get a price cut as soon as it goes broke, so I don't think the military will be worried about bankruptcy. Iridium can't be a specially essential service for the military. The USA seems to be top military dog and has been for a long time without Iridium, so Iridium is an improvement rather than essential. On Globalstar pricing, to give customers confidence, Globalstar could sign some up to a 3 year fixed price per minute of say 80c per minute and with a handset included if a monthly payment of $50 is made for 3 years to cover the cost of the handset. Those customers would be certain of their pricing. People confident with spot pricing could pay the full price for the handset and pay 5c, 10c, 20c, 50c or $1 per minute or whatever the spot price is, which would vary according to demand. For the first couple of years while demand is very low, they'd get a really cheap price, which would boost demand and revenue. After 3 years, they would be paying higher prices, say $1 or $1.50 per minute. Some people could be sold an 'all you can eat for $1,000 per month' package with a free handset and a 2 year contract. That would really get some minutes moving. That would be good in India where a handset could be running 15 hours a day on an attended phone box basis, which is how they already operate in many places. There are lots of contract options to suit individuals and get the minutes sold. No, I haven't worked out the prices carefully; these are just examples. The tail charges would be extra. I'm confident that Globalstar will come up with enough good arrangements to get the minutes moving. Well, most of them anyway, though there will be a lot of unused capacity and I suppose busy signals as things get out of kilter. There will probably be some bumbling to start with as they figure out what will sell and what won't. Maurice PS: If you look at the silly prices in the previous post which AirTouch think they can charge, it seems that Globalstar should be able to sell a lot of regional 'Swiss Cheese' filler minutes, or compete outright with terrestrial service and simply undercut them!

To: RMiethe who wrote (4179)	4/26/1999 10:10:00 AM
From: CommSatMan	Respond to of 29987

Thanks for such a comprehensive and in-depth report. Your knowledge and your reasoning are excellent. As you point out, it appears that no one will divulge the assumptions made on the number of calls supported by a beam. That is why I asked if there had been an independent assessment. If I make the assumption that Iridium, whose banks made an independent audit of capacity, has reasonably accurate numbers, no matter how I calculate and add for link margin differences (power) and CDMA and correct for data rates, I can't get to a ten-fold increase. The best I can get to is 5-6 times and that cuts the 12 billion call minutes down to 6 to 7. Now it looks like G* will still be profitable at these levels. I am just trying to determine their predicted growth rate to get to these levels. Because they are dependent on the Gateways, I don't think that the system will support this level of capacity on day one. You seem to have terrific insight. Any ideas or data would be respected. CSM