Iridium Global Satellite Phone System: Lost in Space?
Read:
Introduction to Marketing
Basic Quantitative Analysis for Marketing
Iridium Global Satellite Phone System: Lost in Space?
Description:
The spin-off of Iridium, a global telecommunications system, represented a
significant business risk for Motorola, as many talented Motorola executives
joined the venture in the late 1990s. This bold technology gamble suffered from
numerous marketing missteps, which led to Iridium's bankruptcy in August 1999.
Study questions:
1) What went wrong at Iridium and why? What facts can be learned from the market reaction to the initial launch and use of Iridium?
2) Who was responsible for the failure, engineering, sales, or marketing?
3) Analyze the marketing mix and Decision Making Process (DMU) /Decision Making Process (DMP) or the original launch of Iridium. Do the marketing mixes make sense?
4) According to the case Iridium spent $145 Million in an initial advertising launch campaign. This resulted in 1.5 Million inquiries in three months. Is that effective or ineffective? Why or why not? Was it reasonable for Iridium's to commit to 50,000 subscribers within six months?
5) One Merrill Lynch analyst (see page 10) argued that Iridium should give away the phones. "They need users, they need buzz...We still haven't seen if there is a market for this." Do you agree or disagree with this idea for Iridium?
6) What does the post bankruptcy Iridium have to do to breakeven?
7) As CEO, what relaunch marketing mix do you recommend?
8) What is your forecast for revenues and growth