GLOBALSTAR ATTEMPTS REBOUND BY ADDING ATC COMPONENT

Final decision on ATCs is expected by end of year, industry sources said (CD July 2 p7). Wireless companies oppose use of ATCs, citing possibility of interference and, in case of ICO, allocation of free spectrum. ATCs allow existing satellite phone spectrum to be used over dedicated terrestrial networks, with call capacity managed and reallocated, in real time, between satellite and terrestrial networks via common control center. During demonstration, calls were made over each network using same phone handset. giving users universal service over single phone network. One of drawbacks of satellite phones has been limitations in urban areas where sight lines are obscured by tall buildings, trees or tunnels.

Use of ATCs also is first step toward utilization of 2 GHz spectrum, spokesman said. Globalstar is seeking authorization to offer ATC services in Big LEO frequencies that it’s using today for existing satellite service as well as newly licensed 2 GHz bands that will be used in future by next-generation satellites. ICO and Iridium have announced similar plans. As integrated ATC/MSS service operator, Globalstar plans to use satellite and ground control center to allocate resources between MSS and ATC networks. Control center manages and reallocates shared bandwidth between 2 networks based upon: (1) Actual and predicted locations of satellites). (2) ATC base locations. (3) Prior MSS traffic demand. (4) Prior ATC traffic demand.

Globalstar also would reassign small number of satellite channels in areas where ATC base stations were located. But because of differences in frequency re-use, transmission power, antennas and radio wave propagation, gain in ATC user capacity actually is greater than loss in satellite capacity, company said. MSS signals are relayed from satellites to gateways, which switch signals into PSTN. ATC service operates just like cellular service, with numerous base stations distributed throughout city to provide indoor and urban coverage. Base stations are connected to Mobile Switching Center that switches ATC signals into PSTN locally, just as in cellular. Signals from base stations to ATC handsets would be in frequency range of 2483.5 to 2500 MHz and from ATC handsets to base stations 1610-1621.35 MHz. Specifications for equipment such as transmission power, receiver sensitivity and services offered, would be same as for cellular or PCS equipment, Globalstar said.

Globalstar ATC system requires re-use of assigned frequencies in indoor and urban areas that otherwise would go unserved by satellite-only MSS network. Service works like cellular or PCS system, but it’s ancillary for MSS operators because capacity is limited and satellite service is primary option. Equipment used for ATC is very similar to that for PCS and cellular networks. For demonstration, Globalstar used microcell cellular product from Interwave and cellular side of Telit-dual-mode Globalstar phone. Microcell and cellular side of telephone were modified to use Globalstar frequencies instead of cellular frequencies.

ATCs “will put the spirit of the 90s back into satellite communications,” Lundberg said. New satellite phones are “smaller, cheaper and simpler,” he said, but product “isn’t ready for the everyday user. Satellite telephones are still evolving.” Pres. Tony Navarra said Globalstar competitors “can’t take the first step” as Globalstar did because they hadn’t built systems. “We are going to be that many months ahead.” If FCC approves system, Globalstar could begin offering service in 18 months to 2 years, Navarra said: “We already have satellites operating.” ICO and others still must build out networks and launch satellites.

Future of Globalstar and MSS will be predicated on ability to attract niche users from govt. maritime, oil and aviation, Lundberg said. Homeland defense, emergency operations and air traffic management will be particularly important to growth. Globalstar has ability to prioritize calls for users from govt. and police agencies. “Service in emergency areas can be used seamlessly,” Lundberg said. “Satellites can be used to help relieve congestion.” He also expects industry to consolidate, saying “the market isn’t large enough for 5, 6 or 7 players, but we are going to reach price points in the next 4 to 8 years where satellite telephones are going to very affordable.”

Despite optimism over use of ATCs, money problems has “hamstrung efforts” of Globalstar to move forward, Lundberg said. Company needs $50-$100 million to complete financial overhaul. Spokesman said creditors were attempting to sell “a chunk of the company” to recoup losses. Goal is to get Globalstar to cash-flow breakeven point, Lundberg said. He said company also would announce new pricing plans in coming days that would be “very attractive to users.” It also will help it clear backlog of inventory, he said.

Globalstar has continued to attract new users with marketing and distribution networks around world despite being “dysfunctional” because of bankruptcy, Lundberg said. Subscribers increased 45% to 74,535 between June 2001 and June 2002. Minutes usage increased 54% to 14.5 million. “The service has been selling itself despite uncertainty about our long-term future,” Lundberg said. Globalstar must undergo “business re-engineering,” he said. In retrospect, he said, rollout of Globalstar and other satellite telephones was poorly designed.