WASHINGTON -- Teledesic, a partnership controlled by cellular-telephone czar Craig McCaw, will announce on Wednesday its plans for recently acquired ICO Global Communications as the battered satellite communications company emerges from bankruptcy protection in the next few days.
McCaw is expected to combine ICO with his Bellevue, Washington-based Teledesic to create a new satellite system that can transmit voice and data to both fixed and mobile communication devices, according to industry observers.
Teledesic, which has undergone several overhauls in the last few years, is under pressure from the federal government to use its satellite licenses or lose them to competitors.
ICO's satellites, which are ready to launch, could help diffuse some of that pressure.
"This [plan] will teach them a lot about the fixed broadband and mobile broadband systems, and will give them experience with dealing with a MEO (middle Earth orbit) constellation," said Clayton Mowry, spokesman for the Satellite Industry Association in Arlington, Virginia.
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Privately held Teledesic -- founded by McCaw and Microsoft Chairman Bill Gates -- could merge with ICO and go public as one entity, industry observers are speculating.
Both Teledesic and ICO officials declined to comment.
"All I can tell you is that ICO is expected to emerge from bankruptcy and we will have a statement out Wednesday morning," said David Bowermaster, a spokesman for Teledesic.
There has also been some speculation that Teledesic is leaning toward a MEO system for its constellation, which is still three years from being launched.
At the International Business Forum and Exhibition last week in Arlington, Virginia, William Owens, Teledesic co-CEO and vice chairman, praised the cost-effectiveness of a MEO system, which requires fewer satellites in orbit than a system in low Earth orbit (LEO).
Teledesic had plans to develop a network of 288 LEO satellites to provide high-speed internet access throughout the world. But it since has cut that number to as low as 110.
Despite its re-emergence, ICO is still hashing out problems with the Federal Communications Commission. ICO must secure licenses and coordinate bandwidth around the world, as well as launch 12 satellites and redesign its gateways to upgrade its service.
Analysts say ICO also must woo back skittish customers who are resistant to mobile-satellite telecommunications service after the failure of Iridium. To do this, they have to develop an advertising campaign to promote their service, as well as establish distribution programs to deliver service and phones to customers.
ICO filed for bankruptcy last August after Iridium collapsed.
Funds to resurrect ICO have come from companies affiliated with McCaw, including Eagle River Investments and Teledesic. Also investing are Deutsche Telecom, Qatar Telecom, Credit Suisse First Boston, Turk Telecom and a Saudi Investment Group named TSFL.
The ICO system was designed to place traditional telephone calls through a global satellite system. But the new ICO will be a broadband system, which will allow for high-speed transmission of data.
ICO plans to launch its service at the end of 2002, but has not set a launch schedule. It lost its first satellite in March when a Sea Launch rocket failed.
"We are waiting for the final word and are anxious to get things moving forward," said Joe Tedino, an ICO spokesman.
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