How will Globalstar's constellation launch affect Iridium?

There are many facets to this answer:





1) Will Globalstar get launched? Depends who you ask. Globalstar today just announced $700 million plus in financing, although the constellation has a price tag of roughly $1.2 billion. Globalstar says they are launching later this year and we'll see. They absolutely cannot afford to have any problems with the launch vehicles. If they lose any satellites, they may be doomed.





2) Will the constellation deliver AND on time? Globalstar has set June 30, 2010 as the 'resume to full service date'. The last satellite launches took several months to get into the proper orbits and fully operational. That means they will need to complete their launches by February 2010 to meet the June 30 deadline.





3) Can Globalstar win back customers since their service issues? Although Globalstar started selling Iridium phones just to keep the clients, many, many other clients remain upset and untrusting of Globalstar. They have been offering unlimited airtime plans that will undoubtedly come to an end so the question then becomes how do they price their new rate plans? To be determined.





It has always been my position that Globalstar and Iridium service different markets. Globalstar had lower-priced hardware and rate plans while Iridium had fully global service. The additional differentiation form June 2010 will be Globalstar鈥檚 data rate, said to be in and 1 MB rate on their handheld phones. That will be spectacular and may cause Iridium some heartburn. However, for fully global service Globalstar cannot compete with Iridium.





These same questions can be asked in reverse in three years when Iridium is set to launch their NEXT constellation.