By November, the Motorola-led consortium had rocketed 66 satellites into orbit, belting the globe from a height of 485 miles. And its representatives had negotiated agreements with 140 countries for its nifty satellite phone service. Iridium is nowhere near signing up the 27,000 subscribers it expected to have in the first quarter. At the beginning of the year, it counted only 3,000 customers. On Monday, the Washington consortium said it's on a 60-day reprieve to pay lenders, since it couldn't come up with the cash.
Iridium needs the time.
A shortage of handsets has put the company way behind schedule. Analysts wonder if, in its rush to get satellites in orbit, Iridium failed to flesh out its marketing strategy. What they put off was sales and marketing. According to Monday's announcement, Iridium has until the end of May to round up 52,000 customers for all of its services, including satellite phones, paging, and calling cards. Iridium has had to deal with the fallout from a key supplier's early failure to manufacture enough handsets.