Teledesic all but folds up

By Susan Rush
From The October 3, 2002 Edition Of CED Broadband Direct

The fat lady may be about to sing at Teledesic LLC. The satellite communications services company has put the brakes on its global, broadband Internet-in-the-Sky satellite communications network.

Over the past 10 years, Teledesic has invested hundreds of millions of dollars on design and development of the network.

In February it looked like the dream was about to become a reality when the company hired Italian satellite manufacturer Alenia Spazio SpA to construct its first two satellites. In all, Teledesic had envisioned a constellation of 30 satellites beaming broadband services to Earth by 2005, but that vision has come crashing down. Teledesic Chairman and Co-CEO Craig McCaw blames the weak telecom market and overall economic environment.

Along with the suspension of construction, Teledesic says it plans to "significantly reduce" its staff. McCaw says the company is still "financially solvent," and he hopes to find a way to start up construction again. For now, the company is evaluating alternative approaches to the business.

The service was being designed to provide broadband access for governments, businesses, nonprofit organizations and individuals on a global basis.