Can Asian boost keep Iridium in orbit?

Iridium, the US$8 billion low orbit satellite telephony system that collapsed under a mountain of debt in 1999, has been relaunched in Australia and Asia under new ownership.

Iridium, the US$8 billion low orbit satellite telephony system that collapsed under a mountain of debt in 1999, has been relaunched in Australia and Asia under new ownership.

The service offers phone coverage anywhere on Earth and does not require land-based base stations.

Calls will now cost between 99 cents and US$1.50 a minute--a fraction of the original service cost--and the service is expected to be targeted at industries that operate in remote areas where there is no mobile phone coverage.

Iridium phones cost about US$3000 but do not require satellite dishes and many of the peripherals necessary with other satellite phone services.

Although larger than a standard mobile phone they are still compact and easy to carry.

Iridium was originally developed by a consortium headed by Motorola.

But after launching more than 70 satellites and only attracting 60,000 customers worldwide it was forced into bankruptcy because of consumer and corporate resistance to call charges which ranged up to US$14 a minute; poor quality and expensive handsets.

It is estimated the original service would have required 1 million customers to break even.

The assets, including the satellites were bought by a group of companies, including Quadrant Australia for a mere US$25 million on condition that a US$3 million a month contract with the United States military was included in the buy out.

As a result the new operating company, Iridium Satellite LLC, has been able to slash call costs.

Melbourne-based Quadrant Communications has been appointed Asia Pacific regional coordinator for the new service and will offer it in 37 countries.

Quadrant’s chief commercial manager, Michael Abela, said the new Iridium company’s operating costs were just 8 per cent of the original business and the US military contract went a long way to covering them.

Quadrant will wholesale the service to service providers throughout Asia Pacific and there are already four service provider offering it in Asia and Australia, he said.

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