Mobile Phone and Iridium
REVIVING IRIDIUM
“The brilliance of the technology cannot take precedence over the market case. At the end of the day, if you’re spending $5 billion on the technology, there better be a market for it. And if there isn’t, there will be great humiliation.”
- Herschel Shosteck, a Wheaton-based wireless analyst, in March 2000.
“Iridium failed to match its system to its mission which caused too much pressure on the company to get customers quickly.”
- Leslie Taylor, a consultant for the satellite industry in Washington, in March 2000.
IRIDIUM’S FAILURE
In August 1999, Iridium LLC[1] (Iridium), the world’s largest provider of global mobile satellite voice and data solutions, filed for Chapter 11[2] bankruptcy protection in the United States Bankruptcy Court. The news did not come as a major surprise to the global telecommunications industry since the company’s financial trouble was well known. It had defaulted on US $1.55 billion in bank loans.
Considering the company’s investment loss of US $5 billion, the bankruptcy court imposed a deadline of March 15th 2000 to either bring forth a purchaser or to close its operations. In response, Iridium promised that if it couldn’t attract a buyer by 5 p.m. that day, it would proceed with plans to liquidate. Despite the company’s best efforts, it was not able to convince any party to support its business and it was forced to file for bankruptcy. Following this, many executives in the top management cadre resigned and its satellite services covering an estimated 20,000 subscribers were stopped.
Commenting on the debacle, COO Randy Brouckman said, “I am deeply saddened by this outcome. I particularly regret the impact this will have on our customers. Iridium achieved significant milestones, and I want to thank the more than 160 countries that licensed the service and the distribution partners around the world who helped market Iridium.”
A spokesman for Globestar,
“The brilliance of the technology cannot take precedence over the market case. At the end of the day, if you’re spending $5 billion on the technology, there better be a market for it. And if there isn’t, there will be great humiliation.”
- Herschel Shosteck, a Wheaton-based wireless analyst, in March 2000.
“Iridium failed to match its system to its mission which caused too much pressure on the company to get customers quickly.”
- Leslie Taylor, a consultant for the satellite industry in Washington, in March 2000.
IRIDIUM’S FAILURE
In August 1999, Iridium LLC[1] (Iridium), the world’s largest provider of global mobile satellite voice and data solutions, filed for Chapter 11[2] bankruptcy protection in the United States Bankruptcy Court. The news did not come as a major surprise to the global telecommunications industry since the company’s financial trouble was well known. It had defaulted on US $1.55 billion in bank loans.
Considering the company’s investment loss of US $5 billion, the bankruptcy court imposed a deadline of March 15th 2000 to either bring forth a purchaser or to close its operations. In response, Iridium promised that if it couldn’t attract a buyer by 5 p.m. that day, it would proceed with plans to liquidate. Despite the company’s best efforts, it was not able to convince any party to support its business and it was forced to file for bankruptcy. Following this, many executives in the top management cadre resigned and its satellite services covering an estimated 20,000 subscribers were stopped.
Commenting on the debacle, COO Randy Brouckman said, “I am deeply saddened by this outcome. I particularly regret the impact this will have on our customers. Iridium achieved significant milestones, and I want to thank the more than 160 countries that licensed the service and the distribution partners around the world who helped market Iridium.”
A spokesman for Globestar,