Qualcomm Incorporated (NASDAQ: QCOM) announced today that Globalstar, LP (NASDAQ: GSTRF) awarded a $275 million contract to Qualcomm to manufacture and supply Gateways for deployment of Globalstar's worldwide low-Earth-orbiting (LEO) satellite-based digital telecommunications system. The multi-year agreement could grow to approximately $600 million for Qualcomm as the Globalstar network is built out. In addition to the Gateways, the contract provides for associated services and the supply of optional equipment to Globalstar LP. Qualcomm expects to begin shipping Gateways in fulfillment of the initial $275 million order in early 1998.
"We are excited about the growing acceptance of the Globalstar system worldwide," said Mr. Gerald Beckwith, President of Qualcomm's Communications Systems Division. "Qualcomm's responsibility for the design, installation, and maintenance of the Globalstar Gateways demonstrates its leadership in seamless satellite communications, and is another significant achievement in building a wireless world."
"This Gateway order is a significant step that demonstrates Globalstar's, Qualcomm's and other Globalstar Partners' commitment to bringing Globalstar service to the marketplace on schedule," said Mr. Tony Navarra, Globalstar's Executive Vice President of Strategic Development. "This important contract represents the culmination of years of work and commitment to the Globalstar program by the Partners, and also marks the transition of Globalstar LP from a development company to a service company that will bring affordable, global mobile wireless communications to the world."
The $2.6 billion Globalstar system, comprising 48 low-Earth-orbit (LEO) satellites and a global network of ground stations, will allow people around the world to make or receive calls using hand-held, vehicle-mounted and fixed-site terminals. Globalstar will also provide data transmission, fax and position location services. Globalstar now has service provider agreements in 104 countries, and has also secured licenses in a dozen countries. Globalstar will begin launching its satellites in the Fall of 1997, and expects to offer commercial services in late 1998.
Qualcomm, under a development contract with Globalstar LP in 1994, has primary responsibility for the development of the equipment and software for the ground segment of the Globalstar system using its Code Division Multiple Access (CDMA) wireless technology. Globalstar LP will resell the Gateways ordered under the contract to service providers worldwide.
Globalstar Gateways are the interconnection points between the Globalstar satellite constellation and existing terrestrial-based telecommunications networks. Each Gateway will contain up to four antennas that track Globalstar satellites as they pass overhead in orbit, sending and receiving Globalstar user signals (voice, fax and data transmissions). Each service area with at least one Gateway within its borders will have complete control over system access by users within its territory. A single Gateway is expected to provide fixed and mobile service in an area as large as Western Europe.
The Gateways will be deployed in various locations on six continents. As Globalstar expands its coverage, these Gateways will eventually form part of a network of more than 100 Gateways that will bring global voice, fax and data services to virtually every inhabited corner of the world. The first three initial Gateways are nearing completion in Aussaguel, France; Yeoju, South Korea; and Clifton, TX, United States.
Headquartered in San Diego, Qualcomm develops, manufactures, markets, licenses and operates advanced communications systems and products based on its proprietary digital wireless technologies. The Company's primary product areas are the OmniTRACS® system (a geostationary satellite-based, mobile communications system providing two-way data and position reporting services), CDMA wireless communications systems and products and, in conjunction with others, the development of the Globalstar™ low-Earth-orbit(LEO) satellite communications system. Other Company products include the Eudora® family of electronic messaging software, ASIC products, and communications equipment and systems for government and commercial customers worldwide. For more information on Qualcomm products and technologies, please visit the Company's web site at http://www.qualcomm.com.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including timely product development, change in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 24, 1996 and most recent Form 10-Qs.
Globalstar, led by Loral Space & Communications Ltd., is a partnership of the world's leading telecommunications service providers and equipment manufacturers, AirTouch Communications, Alcatel, Alenia, DACOM, Daimler-Benz Aerospace, Elsag Bailey, France Telecom, Hyundai, Qualcomm Incorporated, Space Systems/Loral and Vodafone.
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