It is the second time in a month that the company, which is building a satellite telecommunications network, has failed to meet its investment goals. A previous plan that expired in July would have raised $500 million but failed when not enough money was pledged.

ICO, United Kingdom-based company, hopes to launch its satellite phone business in 2000.

The company will lower its sights in its next fundraising proposal, asking for less than $600 million, according to a company release.

Any new proposal would likely include communications giant Hughes Electronics.

Hughes, which has invested $94 million in ICO, is interested in increasing its investment in the company, according to Hughes spokesman Richard Dore.

In the end, ICO must raise another $1.6 billion to attain the $4.7 billion it says it needs.

The announcement is the second piece of bad news for the satellite phone industry since Wednesday.

Iridium World Communications LLC, the first operating satellite phone company, announced then that it had defaulted on two loans worth $1.5 billion. Its service has not caught on as expected, and its revenue projections have not been met.

Many in the industry have said that Iridium's financial woes have hurt investor confidence in the industry, making it more difficult for other satellite phone companies like ICO to raise money.

And the potential consequences of those difficulties are severe.

"Failure to complete the financing proposal," an ICO release says, "will have a material adverse effect on the Company's liquidity, results of operations, and financial condition, as well as on the company's continued viability."