The larger US mobile phone businesses have tens of thousands of consumers. Iridium currently (Mar 06) has about 150,000 - 100 times smaller than key cellular phone companies. The price of its 66 satellite network is about $6 billion, and although those are all sunk fees, the satellites will have to be replaced at some stage.

A similar equation applies towards gear. Well-known cell phone designs sell in quantities of several thousands, and the underlying technology changes little from model to model, permitting development fees to be split over several units, and with most effective large volume production methods. But the Iridium satellite phones are selling really gradually, and have special technology in them.

And so, whereas your typical cellular mobile phone company can possibly make money by giving you a free of charge cell phone and 1000 minutes of airtime for only $30/month; Iridium totally can not.

Lack of competition and price inelasticity

You've a lot of options when choosing a normal cellular phone provider. But there is only 1 totally international satellite mobile phone provider - Iridium - and only one source of Iridium handsets.

Could Iridium offer its 9505a phone for much less than $1500? Nearly certainly - the underlying variable charge per mobile sold, to Iridium, is possibly $50. No need to reduce the mobile price, due to the fact you will discover no competitors.

Iridium might choose to drop the price tag from the handset like a way of encouraging far more individuals to register for their program, in a similar way to how regular cellular phone operators give away phones, but to date it has resisted such temptation.

Could Iridium offer its airtime for less than the rates it does? Which is an additional complex query; for certain, the variable added cost of accepting one more call onto their network is close to zero, but they've large fixed fees that have to be covered. And, significantly such as the mobile price tag, for people who really have to have a satellite telephone, $1.50 a minute is often a bargain. And for folks that don't have to have a satellite cell phone, even 50¢ a minute is probably too very much. Iridium most likely feels that to the sort of individuals who have to have and use its solutions, its prices are fair.

Future satellite mobile phone selling price trends

Considering these problems above, we do not predict key drops in either mobile or airtime fees occurring with Iridium satellite assistance in the foreseeable future.

Checkout The Most Up-To-Date Story Concerning The Ultimate In Go-Everywhere Telephone Service
Only a couple of decades ago, we understood and accepted that for 'ordinary people', phone service required a phone line and was therefore limited to obvious places like home, office, and payphones.

Get The Latest Information Concerning The Advantages Of Satellite Phone Hire
Eventually, many people discover that renting a satellite phone is more convenient for them than buying one. Travellers, explorers, adventurers and many others who need these products will benefit when they opt for rentals.

Inmarsat Selects EMS Solutions To Layout Next-Generation World-Wide Satellite Mobile Phone
Inmarsat's next-generation dual-mode satellite phone and GSM mobile phone. The contract, which expands EMS's market focus beyond aeronautical broadband, is for approximately $26 million.

Get The Latest Story Regarding Inmarsat Isatphone Pro - The Ideal World-Wide Hand Held
The newest service, Inmarsat's first world-wide handheld, has an unmatched specs in the most acceptable cost out there. Extensive screening has shown that will IsatPhone Pro has got the market's best battery life and the most robust phone.

Checkout The Most Recent News About Inmarsat IsatPhone Pro Airtime Rates That Are Now Obtainable!
Global Telesat Communications is pleased to announce that we now have airtime rates available for the new IsatPhone Pro. Inmarsat are proving very competitive with their sat phone call charges on both pre-paid and post-paid airtime.

The Important Things To Consider When Getting The Satellite Cell Phone
Some of the people who need satellite phones include miners, sailors, explorers, those going on expeditions, those involved in emergency services, geologists, and those who participate in off-road sports such as mountain climbing and motocross.

Learn About The Most Recent Information Concerning IsatPhone Professional Bringing Satellite Mobile Phone Calls For The Masses
The Inmarsat IsatPhone Pro was first unveiled by SingTel back in May. We finally got a chance to try it out at CommunicAsia 2010. This is a satellite phone that lets you make calls in areas out of regular cellular (such as GSM or CDMA) coverage.