An Epic Struggle for the Hinterland
Odyssey plans to bring basic phone service to underdeveloped countries and mobile phones to remote U.S. areas
P> Odyssey Telecommunications, Redondo Beach, Calif., is one of a handful of satellite companies attempting to build a telecommunications bridge to the wilderness of the United States as well as to underdeveloped countries.
A partnership of TRW Inc. in Redondo Beach and Montreal-based Teleglobe, Odyssey soon plans to announce major international investors in the $3 billion project and will launch its first satellites in 1999. Although company officials would not identify the investors, they expect funding from foreign companies with telecom business experience.
To push the world a few steps forward in universal phone coverage, Odyssey plans to launch 12 satellites that will communicate with seven earth stations. The Odyssey system uses medium-earth orbit (MEO) satellites.
Some competitors are using low-earth orbit (LEO) or geostationary satellite systems (GEO). Odyssey claims it will win the satellite race in part because of its choice to use MEO, which requires fewer satellites than LEO and uses simpler technology than GEO. Those differences translate into a lower-cost system, which means cheaper prices for customers, said Ed Knowacki, vice president of TRW and program manager of Odyssey.
Most developed countries have a "teledensity" ratio of 60 telephones to every 100 people. But other nations suffer from a serious phone shortage. There are 1.3 phones for every 100 people in Indonesia and 2.3 phones per 100 people in China.
"The gap between developed and undeveloped countries is huge," said Don Falle, director of marketing and business development for Odyssey.
Although most people in the United States have access to phone service, not everyone can use mobile phones. The urban, highly populated areas, which account for about 90 percent of the U.S. population, have access. But only 50 percent of the U.S. land mass is covered.
Odyssey customers, no matter where they are, can dial a number, which broadcasts a signal to the closest earth station. The station communicates with the satellite to ensure the user is a valid customer. A voice channel then is set up, and the call goes through. The process takes a few seconds.
Now, only 8 to 10 percent of the U.S. population has wireless service. That market is expected to grow to 35 percent by 2008. Odyssey expects to have 35 to 40 million subscribers in place by that year, said Bruce Gerding, managing director of Odyssey Telecommunications. The company's research suggests that the market will support about three competitors, he said. Many more, however, from Hughes Communications Corp. to Bill Gates and cellular pioneer Craig McCaw's Teledesic, are getting into the satellite communications business.