SECTION NO: 1
KEY DECISIONS TAKEN BY IRIDIUM
There are many several key decisions taken by the IRIDIUM Company in order to stimulate its growth and its overall position in the market. IRIDIUM has been known for its uniqueness in the market, which is the very reason of their existence in the market of IT based industry.
These key decisions have laid the foundation of IRIDIUM in creating awareness of the cellular services providing industry and this has also led it in creating awareness in those areas like Bahamas Island where the communication was the major problem. Therefore, Karen, the chief engineer in the Motorola Company generates the idea and decided to develop a system, which will interact with each and every one globally in an easy way.
Later on, IRIDIUM decided to replace its cellular towers with the satellites to overcome the drawbacks of tower based cellular system.
It also decided to keep the plan of the above mentioned changes as a secret.
In the first phase, it wanted to change the cellular technology with GEO satellites which later on discovered to be more power consumption satellite due to which it decided to change these satellites with LEO satellites. The power consumption of LEO satellites is low as well the quality of transmitting the signals is greater than GEO satellites, and also it is cheaper than that.
The research on the competition and market is conducted unearthing many facts like its target customers are mostly travelers who call while travelling.
IRIDIUM decided to arrange the financing via equity and plans to raise 800 million by partnering with the small blue chip companies like AT&T and NTT to enhance its growth further.
It has been continuously facing the withdrawal of the proposal from many potential investors and the increased opposition forces the company to adopt some change by appointing the Leo Mondale as a vice president of IRIDIUM internationals.
The evolution of the plan starts from redesigning the system to interact with many gateways. These multiple gateways will be managed by the multiple investors, independently and also grant them board membership accordingly.
After the arrival of Mondale, another key decision regarding the pricing of the service is put into consideration. As per the new and revised policy, IRIDIUM will be able to charge the same rates as AT&T.Inaddition to this it will also provide them some fringe benefits of using their service like discount shares in IRIDIUM, discounted telephones, and free minutes for government use.
Another 800 million will be required to raise finance via equity, and changing of their traditional vertical environment to the horizontal. They have decided to change their production module in an assembling system.
Due to technological development IRIDIUM has taken the decision of redesigning its phone to support the increase in the frequency.
In addition to this, it has decided to introduce the satellite services side by side with the cell tower services providing it with the flexibility of switching between the two.
SECTION NO: 2
ANALYSIS OF TAKEAWAYS
Analysis of cellular technology: The two engineers, Ray Leopold and Ken Peterson,raise the possibility of having the global telephone network through the use of technology developed in early 1980 s named “Cellular Tower".
This technology requires the involvement of towers through which the signal can travel to the geographical area. However, the area covered geographically through this technology is limited as each tower as its specified limit up to which it can send the signals. Once the user gets out of the sight tower, the signal is lost. The introduction of this technology has shifted the airways of many companies, enabling them to catch 250000 subscribers at the end of 1980 s and also hoping for the rise in this amount to 4 million in 1990.
The AT&T forecast shows up to 30 million potential subscribers by the year 2000.
However, this technology requires the substantial increase in the investment further towards technology to control those towers efficiently.
There are limitations of the cell towers as the signals get blocked every time in the places, which are located near high mountains, and mostly in urban areas where the need of this technology is high. This causes the quality of the service to decline as well as the sales of that particular area(HS Kwon, 2002).The Rise and Fall of Iridium Case Solution
Analysis of Satellite technologies:In order to over come the problem of cellular technology, which is limited to particular regions, satellite technology is utilized. As they orbit around the globe with a speed of 17000 miles an hour, the satellite will move towards the position of the caller while the caller remains stationary..........................
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