|Irregular Remedy for Iridium|
|Subject||Equilibrium and comparative statics|
|Key Words||Cost, Sales, Stock Price|
Iridium is a relatively new hand-held satellite phone service. Calls can be made anywhere on earth. The cost of a phone is $3,000. However, sales are poor-there are only 3,000 subscribers and 500,000 are needed to break even. The stock price has tumbled from near $50 in November to under $20 a share.
The war in Yugoslavia has given Iridium a boost. News and aid organizations are using the phones in war zones where wired and cellular phones do not work. Viewers of television news see the phones in action.
In addition, as a humanitarian gesture, Iridium phones have been sent to refugee sites where refugees have been able to make free calls. The long lines have also been seen on television, giving Iridium even more exposure.
(Updated June 1, 1999)
|Source||Kevin Maney, "War in Yugoslavia gives Iridium chance to shine", USA Today, April 16, 1999.|
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