Iridium network is up and running Pricey, 66-satellite phone service boasts links to anywhere


November 03, 1998

CHICAGO -- Iridium, the global satellite phone service, has opened for business, giving people the power to make and receive calls anywhere from Mount Everest to the Dead Sea.

"After 11 years of hard work, we are proud to announce that we are open for business," Iridium LLC Chief Executive Edward Staiano said in a statement yesterday. "The potential uses of Iridium products are boundless."

Iridium, which took $5 billion and 11 years to create, made its service available Sunday after a one-month delay.

Iridium customers will be able to make and receive phone calls from ships at sea to the highest mountain, according to the company.

The system enables business executives, as well as workers with disaster relief or oil and mining operations in remote areas, to never be out of touch.

The Iridium system uses an array of 66 satellites in low Earth orbit combined with land-based wireless systems. It went into service after more than a decade of testing and development, some lost satellites and postponement of the initial September start-up.

The technology comes at a high price. The phones, made by Motorola Inc. and Japan's Kyocera Corp., cost about $3,000 each. Phone calls cost about $1.27 to $2 per minute domestically and $2 to $7 per minute internationally.

Washington-based Iridium is offering satellite voice, cellular roaming and calling card phone services. Paging, which analysts said took a back seat over the past month, is to come on line by midmonth.

An Iridium spokeswoman said the company plans to have about 100,000 phones in circulation by year's end. It expects to have a positive cash flow by the end of next year.

Motorola, a pioneer in high technology, developed the Iridium concept, setting it up as a separate company in 1991. Based in Schaumburg, Ill., Motorola has booked large losses from the $5 billion venture but finally sees a "significant contribution" to overall profits at the technology and telecommunications giant in 1999.

Iridium is a consortium of high-technology companies, in which Motorola holds the largest stake at 20 percent. Others include Sprint Corp., Raytheon Co., Lockheed Martin Corp. and Pacific Electric Wire & Cable Co.

Pub Date: 11/03/98

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