Iridium, the satphone is still up in the air

Last October, Iridium had anticipated worldwide sales to touch 200,000 subscribers by year end; in 1999 the old marketing plan is ready to be jettisoned. Instead of snob appeal, it is industrial users who are showing interest in buying the clunky Iridium handsets. But that too depends on how soon Iridium can iron out various problems and create affordable packages for various groups. Clearly the $ 140 million global advertising campaign, created after complex international brain storming, will be discarded too.

Lets look at the Indian situation. Obtaining alicense and getting its telephone consignment cleared were only the first hurdle. Getting subscribers used to the phone is another matter. Apparently, in wide-open fields Iridium works like a dream. Santosh Yadav, the gutsy mountaineer who is aiming to climb Mount Everest for the fifth time, has been given a phone to keep her constantly in touch and test out the system — it works. Similarly, when two ONGC wells caught fire, Iridium rushed a couple of instruments. ONGC is apparently impressed enough to plan a large purchase. So is the army, which is excited at the possibility of better and easier communication with its remote stations.

But for the global business traveller, Iridium is not on the agenda. Iridium users are fast realising that to be accessible to the world, they have to be out there in the sun. No sooner are they inside a building than the signals vanish. The company now offers users an elaborate pager link; when inside a building, the pager is still able to catch the signals, allowing theuser to rush out in the open and receive the satellite call. Iridium’s plans for cellular roaming have also not materialised because VSNL has to make the modifications which allow a roaming facility between different international cellular protocols. VSNL needs permission from the DoT to make the change, and everyone knows that the DoT simply cannot be hurried into doing anything. A subscriber from Bhopal found other problems. “Most people”, he tells me. “simply cannot reach me and those who can will never call unless it is an emergency”, he says. That is because, anyone calling an Iridium phone has to prefix the number by dialing the 00′ international code followed by the 8816′ Iridium code. This makes it an international call.

But even if one is willing to pay international rates, there is no guarantee that the Iridium user can be reached. The Iridium user has to be called from digital exchanges, and each of these exchanges has to physically make a change in its programme to be able to speak’ tothe Iridium phones. Obviously, Iridium is focussing on the larger cities, because there is little chance of Iridium phones being called from hick towns. Iridium India is now focussing mainly on the industrial user market. But clearly its marketing has to be adjusted for the prohibitively expensive cost of the calls. The next problem is recovery. If selling the global service is tough, getting users to pay for it may be Iridium’s toughest challenge yet. For starters, it is trying to learn from the mistakes of the cellular phone operators. Iridium asks its subscribers to have their companies pass a board resolution permitting the subscription. “We are only trying to check if the phone bills are going to be paid from capital or operating expenses, so that we can assess credit risk,” says Raja.

Iridium’s problems in India are bound to be replicated in several other countries. One can only say that dreams sometimes get tougher when they turn into reality. For the consortium of Indian institutions who haveinvested in the project, the chances of returns in the near future are fast turning into a dream.

Author’s e-mail: suchetadalalyahoo.com