October 11th, 2006
I done a due diligence on Iridum for a banker in 2002.
It was already pretty interesting back then. Iridium went backrupted in Aug 1999 and in Nov 2000 was bought out for 25M USD by a group of investor, including Khalid bin Abdula bin Abdulrahman.
In Dec 2000, DoD awarded a 2year 72M USD deal for 20,000 handsets with an option to extend it for 5 years. Supporting DoD alone covers 40% of the OPEX :-)
They only need 60,000 subscribers worldwide to breakeven.
The 66 “birds” (satellites) however have a lifespan designed for 7 years and would expire in 2005. However, the engineers is able to tune it and it is possible to last until 2008 to 2010 and minimual data service could still function until 2015.
The problem for the investors is that when the birds expire, it is going to be expensive excerise to replace them, probably to a tune of 3.5b, altho Boeing mentioned back then they are willing to share the cost.
Anyway, sadly the deal didnt go through. It would be interesting otherwise :-)