Remember where you were on February 7, 2007? It was a day that brought hugely impactful news to the business.
The constellation had been damaged and service was going to deteriorate until they launched the new constellation. But that was in two to three years, such a long time….
had just launched the smallest in the world, the GSP 1700 six days earlier. This phone is the size of my Blackberry and it was very cool. It also carried a very competitive price tag. How could this be happening?
That unfortunate chapter ends today: In just a few hours a rocket will blast off carrying six brand new satellites into space. They will join eight existing, second generation birds that have been carrying service for the past 18 months or so. The estimate is that by June of next year, service will be back to 50% and in a year we’ll see a resurgence of 95% of Globalstar’s top quality voice service (and it really is top quality service).
The new constellation brings much more functionality that we will outline in future posts. Other noteworthy items:
Globalstar will offer the for just $500 and unlimited voice and data service for just $20 a month!
This program is by far the best deal in the business and designed with one goal – Bring back subscribers. We’ll keep you posted as to the terms and valid dates but if you have even been considering buying a Globalstar phone, now is the time.
So, today, 2 1/2 years after some very bad news, we bring you some very good news: countdown to launch and new pricing for phones and service.
Globalstar, Inc. has announced that Coface has agreed to provide a guaranty in support of a proposed $574 million credit facility to be extended by a syndicate of banks to Globalstar as borrower. Coface, the export credit agency acting on behalf of the French government, has advised Globalstar that it intends to provide long-term credit insurance to facilitate the proposed credit facility. Banks who have received initial credit committee approvals in relation to the approximately 6.30 percent interest rate credit facility include BNP Paribas, Natixis, and Société Générale, which would act as mandated lead arrangers (BNP Paribas is acting as Coface Agent). The credit facility and receipt of funding by Globalstar is subject to closing conditions and there can be no assurance at this time that any such closing will actually occur.
The principal closing conditions include the conversion into equity at closing of senior secured term and revolving credit loans to Globalstar from its principal stockholder Thermo Funding Company LLC and the receipt by Globalstar of additional equity and contingent equity in an amount of approximately $100 million, most of which is expected to be provided by Thermo Funding.
Globalstar intends to use the financing to solidify its long-term space system by funding the manufacture and delivery of the Globalstar second-generation satellites by Thales Alenia Space as well as the launch of those satellites by launch services provider Arianespace. The financing would also be used to facilitate certain long-lead items connected with the accelerated delivery of the Company’s second-generation satellites, the completion of Globalstar’s next-generation ground facilities and the design of Globalstar’s next-generation of satellite interface chipsets.
Planning and progress continues towards the new constellation launch
The degradation of Globalstar ’s satellite constellation has been truly unfortunate; the system is an excellent satellite system when fully functioning. GlobaFone is the largest Globalstar dealers in New England with dozens of clients with thousands of lines. We are looking forward to the new constellation restoring full service. There are some things you can do right now to take advantage of the situation:
Buy a Globalstar GSP 1600 for $349.00 with the activation fee. This price is less than half the retail price just a year ago and it is a great phone. It will work on the new constellation.
Activate the phone on the Loyalty Plan. This costs just $39.99/month until 2009, then $19.99 for 2009, 2010 and through the first year of the new constellation! Includes unlimited domestic airtime (US and Canada)! This will help you budget your airtime costs for about the next three years.
Here’s the tentative schedule for development and deployment:
Spring 2009—Globalstar starts taking delivery of the new satellites.
Fall 2009—Launches will begin from one or more launch sites
Spring 2010—Service begins on the new constellation
Since your current Globalstar equipment is backwards compatible—that means it will work on the new constellation—why not pick up some phones at the remarkable pricing listed above. This is a strategic move that will help you into the future when full service is restored. We see it as a great move.