Posted by Colin Clark on April 12, 2000 at 12:58:43:
In Reply to: Space News Article Available Online???? posted by Kimberly on April 07, 2000 at 15:42:41:
Kimberly,
Here is the Space News story. I'm Colin Clark, a reporter for its sister publication, Defense News. I'm also a longtime visitor to Briland and was the one who put Space News onto you.
My wife and I arrive on Friday. Would you like a copy of the paper? Let me now and I'll bring one.
Colin
IRIDIUM USERS WARILY CONSIDER SWITCH TO ... 03-27-00
Space News
Published: 03-27-00
Category: THIS WEEK
Page: 5
Keywords:
IRIDIUM USERS WARILY CONSIDER SWITCH TO GLOBALSTAR
Byline: By BEN IANNOTTA
KEY WEST, Fla. -- Well-heeled residents of the Bahamas, who rushed to buy Iridium satellite phones in the wake of last fall's Hurricane Floyd, are feeling burned by news of the Iridium system's demise. But not so burned that they will not consider giving the new Globalstar constellation a try when it becomes available.
"I'm getting inundated with questions. Is Globalstar the real deal? People don't want to get burned again," said Kimberly King-Burns, a part-time resident of Harbour Island and the producer of an online message board for Bahamians called the Briland Modem. "Briland" is how Bahamians refer to Harbour Island, King-Burns said.
For now, the questions about Globalstar are moot because the 48-satellite constellation, built by Space Systems/Loral of Palo Alto, Calif., does not yet serve the Bahamas.
The Globalstar satellites cannot pass calls between each other, which means they must transmit calls via ground relay stations called gateways. If there is no gateway in an area, there is no service. A new gateway in Puerto Rico will serve the Caribbean and Bahamas, but the facility is not scheduled to open until late summer, said Globalstar spokesman Mac Jeffery.
Thanks to September's Hurricane Floyd, handheld satellite phones have become a must-have for those on the islands who can afford the $1,500 handsets and per-minute calling rates, King-Burns said.
"This is not a luxury. It's the only means to communicate with the mainland" for months after a major hurricane, she said.
King-Burns said she sold 35 Iridium phones in the aftermath of Floyd. She estimated there are thousands of Iridium customers in the region including resort operators, government officials and hurricane relief workers. Normal phone service only recently was restored to some areas, she said.
On March 6, Motorola Cellular Services Inc., a primary marketer of Iridium services, began advising customers in writing that the Iridium system might be turned off. The letter said nothing about refunds, and a special Web page set up by the company does not mention the issue either.
However, Motorola spokesman Scott Wyman said in an interview that people who have bought Iridium telephones from Motorola since January would be eligible for refunds.
On March 17, Iridium's attorneys informed the U.S. Bankruptcy Court for the Southern District of New York that attempts to find a bidder qualified to take over the struggling company had been unsuccessful, forcing the company to end service at 11:59 p.m. EST that day, dismiss most of its employees and ask Motorola to begin deorbiting the low-Earth-orbit satellites. The Washington-based company asked the court to release $8.3 million to cover the costs of winding down Iridium's operations and said it would move its remaining employees to offices in Reston, Va., to oversee the disposal of Iridium's ground-based assets.
The only publicly identified bidder for Iridium was Eugene Curcio, president of Venture Partners Inc., Rolling Hills Estates, Calif. Curcio told Space News he planned to use the Iridium satellites to provide telephony service to underserved parts of the world for between 30 and 50 cents per minute. Existing Iridium customers would have been able to keep their service under the plan, Curcio said.
Some Iridium customers are furious that they were not given more notice of the system's impending shutdown nor offers of refunds. Richard Haskell, a part-time resident of Harbour Island, is one of them. He said his son is sailing around the Caribbean on a 30-foot sailboat and was counting on his Iridium phone as a safety device to go with his marine radio and emergency satellite beacon system.
Although Haskell said he would consider buying a Globalstar handset, he said he will be wary this time.
"Nobody's going to lay down $1,500 again without some assurance that if [they] go out of business, [they'll] give you back your $1,500. I can't imagine that the market won't be sullied badly by this," Haskell said.
Haskell said he has submitted a demand for a refund in writing to Motorola, but he has not heard back from the company.
Globalstar's marketing plan does not include assurances about procedures in the event of failure, Jeffery said. "No company offers you a service, and says, 'Oh by the way, we'll give you a refund if we go bankrupt,'" he said.
Jeffrey said Globalstar is convinced its service will be a success and that company officials are not even talking about bankruptcy scenarios.
King-Burns said her advice to Globalstar is to focus on honest marketing. "You've got some real snake oil salesmen out there," she
said. King-Burns said she learned through her own research that her region is not yet served by Globalstar.
Jeffery said Globalstar has gone out of its way to tell customers
that the company is rolling out its service step by step. "We learned a
lot of lessons from Iridium. One of the them was you don't overhype
this," he said.
Globalstar's U.S. service provider, Globalstar USA, which also will serve the Caribbean when Globalstar's Puerto Rico gateway begins operating, is offering Iridium customers rebates of as much as $495 to entice them to switch, said Toni Carinci, a spokeswoman for Globalstar USA, Walnut Creek, Calif. Although Globalstar service is not yet available in the Bahamas, Carinci said Iridium subscribers in the region are eligible for the rebates and can contact Globalstar distributors to make arrangements to take advantage of the offer.
Iridium phones never became hot sellers in the Florida Keys, a chain of islands in the southernmost part of the state that escaped
Floyd's wrath.
Carl Aufrecht of the Keys Sea Center on Big Pine Key said he sold seven or eight of the phones for $1,495 and $2.35 a minute. "To have that security on your boat, that's cheap," he said. "But in order to get it into the hands of a lot of people, the handsets are going to have to
be a lot cheaper."
Globalstar phones cost about the same as the final Iridium price of $1,500, but Globalstar is promising per-minute rates of $1.50 or less.
Jeffery predicted the handset prices would go down, but he could not say by how much.
Aufrecht said he doubts a satellite phone company can survive based on the post-hurricane emergency market. "A system can't be supported by
people who are letting the phone sit there waiting for a hurricane. The system needs continuous service," he said.
"There's no individual market that's going to be a million phones.
But collectively, you add it up and it is attractive," Jeffery said.
Some people in the Bahamas are hoping Globalstar will be ready by
the peak of the next hurricane season. "I think [Globalstar] is going to
have a windfall. We here in the Bahamas are petrified of the 2000
hurricane season," said Sharon King, Kimberly's mother, speaking from
her home on Harbour Island.
Staff writer Sam Silverstein contributed to this report from
Washington.
: Any thoughts as to how we can view the recent Space News article online?
: Thanks --