Reviving Iridium

About Satellite Telephones Contd...

• Personal Communications Service (PCS): It is a completely digital, two-way, wireless telecommunications system specifically designed for the US metropolitan areas. PCS networks are CDMA, TDMA and global system for mobile communications (GSM).

Satellite telephones are another kind of wireless telephone services that communicate via satellites circling the earth. There are two types of satellites:

• GeoSynchronous Satellites: These satellites, located 22,300 miles above the earth, revolve round the earth every 24 hours and hence they appear stationary. Two frequency bands are used, one each for uplinking and downlinking. Such satellite systems are excellent for data transmission, but not very good for voice communications. This is because of the distance involved and the time taken for electrical signals to make one Earth-Satellite-Earth round trip. Because of the long time taken to send and receive signals, voice communications are usually not carried via GeoSynchronous satellites.

• Low Earth Orbit (LEO) Satellites: LEO satellites communicate directly with handheld telephones on earth. They are stationed as low as 900 miles above the earth's atmosphere. The communications equipment on a satellite catches the call from earth and passes it to an earth-based switching system. Due to the high speed, at which the satellite revolves, it is necessary to hand off a particular call to another satellite that is just rising over the horizon. The process is similar to that of a cellular system, except in this case the cell site moves rather not the subscriber.

The demand for wireless cellular services has increased considerably from a mere 10 million subscribers in 1989 to around 520 million in 2001. Yet, using a wireless cellular service was not very convenient to people who were always travelling. They could not make calls to their desired places once they were out of their home network. Also, making calls to/from places, following different cellular standards or frequencies was not possible. Moreover, the cost for making international calls was high and GSM users had to use only GSM compatible handsets that worked out rather expensive because of high rental and call charges.

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Case Details

Case Code : BSTR031
Themes: Turnaround Strategy
Case Length : 11 Pages
Period : 1999-2001
Organization : Iridium LLC
Pub Date : 2002
Teaching Note : Available
Countries : USA
Industry : Telecommunication

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