(By Greg Guenthner) Only 14 years ago, an innovative startup launched the world's very first global satellite communication system. Using a hand-held wireless phone, the company's customers could call anywhere in the world — from the streets of New York to the North Pole to the center of the Sahara Desert.
The sheer cost and scale of the project — which included more than 60 low-orbit satellites — captivated technology and space buffs alike.
"It was the boldest and most-expensive private space initiative yet undertaken,' the Smithsonian reflects, "a test of the post-Cold war notion that markets might replace government as the drivers of space exploration and development.'
The company's formal launch in 1998 solidified it as a dot-com darling, ushering in a new digital world that would give everyone on earth the ability to instantly communicate with anyone at the push of a button on a wireless device.
There was just one problem: The venture quickly became a failure of epic proportions.
Nine months after signing its first customer, the company filed for bankruptcy. The era of commercial satellite phones was over before it even began.
However, a bankrupt company with an idea ahead of its time is not the end of this story. In fact, it's just the beginning.
Let me explain…
The dream of a seamless mobile communication network took shape in the late 1980s. It was an engineering team at Motorola that initially had the idea for this global communication service. As it was initially designed, the system called for a network of more than 60 low-orbit satellites to provide a wireless phone signal anywhere in the world.
The idea of a satellite phone service was quite revolutionary at the time. The fact that the concept had never been attempted created several barriers for the engineers at Motorola. For starters, no commercial enterprise had yet to attempt to launch low-Earth orbit satellites for a communications system. It was a logistical nightmare that even required international diplomacy to ensure that the satellite phones would work with every single phone system in the world.
Despite the scale of the project, progress was made. Motorola spun off its space-bound division in 1998. Marketing campaigns for the new brand proclaimed, "One World…One Telephone.'
Now, keep in mind that cellular service in the mid- to late 1990s was spotty at best. And at the time, there was a legitimate debate as to how the world's mobile communications would evolve. Iridium's satellite phone system was launched at a time when the developed world's cellular connectivity was still bare-bones. If you ventured outside a major city, there was little chance you would be able to find a strong cellular signal.
But in the end, you know how the satellite versus cellular story ends. Cheaper cell towers became more ubiquitous, while crippling debt combined with far too few customers doomed the satellite phone business model. To put things in perspective, it cost thousands for only one of satellite phone — and call charges topped $7 per minute. With cellular phone networks growing, the choice was a no-brainer for potential customers looking to stay connected on the go.
The hope and hype of a space-age phone system was gone, and the headlines disappeared. Yet from the rubble of a failed idea, a new business was quietly taking shape…
Few noticed when the U.S. Department of Defense — one of the company's first customers — saved the satellite infrastructure. Even fewer noticed when a group of new investors bought the company and re-branded it. And almost no one realizes how profitable this new company has become.
A commercial satellite communication network may have been ahead of its time in 1998. But today, it has become a necessity. Expect breakneck growth in this sector in the coming years–along with a new era where people, ships, airplanes and even machinery demand constant communication.