Globalstar seeks satellite space

Globalstar plans to use Telecom 99 as its official launching pad into the satellite market. Although Oct. 11 will serve as the satellite provider's official birthday, the company will begin rolling out service at the end of September. Despite the skepticism that hovers over the satellite market, Globalstar, 45% of which is owned by Loral Space & Communications, foresees launching full commercial service by the end of the year. Globalstar officials were not specific about where service will begin, but it plans to launch in select locations, including parts of North America, through its partnership with AirTouch, as well as China, Italy, South Africa and the U.K.

It is determined to move step by step to avoid potential problems that have plagued its counterpart, Iridium. "We still feel that our business model is night and day from Iridium's as well as our marketing model," said a Globalstar spokesman.

Despite the optimism, some analysts see a dim future. "Investors have been running scared and with good reason. This is a very small market where only one company will be robust enough to survive," said Andrew Cole, senior manager with Renaissance Worldwide.

Because the market has moved beyond using satellites, which may have been a good application 10 years ago, "this technology is looking for a home where none exists," Cole said.

Although he is bearish on the satellite market, Cole predicts that if any company is going to survive, it will be Iridium because it was first to market, and it understands the challenges of the satellite market.