- dan
Media Contacts: Teledesic:
Roger Nyhus, (206) 915-3878; nyhus@teledesic.com
Bob Ratliffe, (206) 979-4254; ratliffe@teledesic.com
Motorola:
Lawrence Moore, (602) 441-3000;
lawrence_moore-p25089@email.mot.com
Norm Sandler, (847) 576-2346; ans003@email.mot.com
Teledesic, Motorola, Boeing, Matra Marconi
Space to Partner on 'Internet-in-the-Sky'
- Motorola Will Lead Global Industrial Team -
NEW YORK - May 21, 1998 - Teledesic LLC and Motorola Inc. (NYSE: MOT)
today announced they will become partners in the further development and
deployment of Teledesic's global, broadband "Internet-in-the-Sky"
satellite communications system. The Boeing Company (NYSE: BA), the
world's leading aerospace company, and Matra Marconi Space, Europe's
leading satellite manufacturer, will round out the team of founding
industrial partners.
Motorola will be the prime contractor for the global technology team
that will spearhead the engineering and construction of the world's
first advanced telecommunications network to provide high-speed data
connections to businesses, institutions and individuals everywhere on
Earth - regardless of location. The team will combine the technical
efforts now under way on the "Internet-in-the-Sky" system pioneered by
Teledesic and the Celestri broadband satellite system conceived by
Motorola.
"The globalization of this effort has begun in earnest. The strengths
of these companies and their reach are completely complementary. They
have all performed on a world stage and now will bring the technical
framework of Teledesic into focus," said Craig McCaw, Teledesic's
chairman and co-chief executive officer. "As we continue to expand our
global team, we will clear the path to deliver the substantial benefits
of connectivity to people throughout the world. We are very fortunate
to be able to bring together the best people and the brightest ideas
from our partners to help us build this system."
Motorola CEO Christopher Galvin said, "This is a natural fit of core
competencies, know-how and vision. Rather than continuing along our
separate paths, we're combining our best efforts to deliver a new
generation of broadband communications services to people around the
world."
McCaw, Galvin, Harry Stonecipher, Boeing's president and chief operating
officer, and Armand Carlier, Matra Marconi Space's chairman and CEO,
announced their companies' plans today at a news conference in New York.
As a result of the agreement outlined today, Motorola will receive a 26
percent stake in Teledesic for a combination of cash and the value of
design and development work that will be redirected from Celestri to the
new joint effort. Motorola's total investment has a $750 million
valuation. The boards of both companies have approved the plan.
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Page 2 of 3
May 21, 1998
"Chris Galvin has brought a refreshing world view to Motorola that
places a new emphasis on collaboration and partnership," McCaw said. "I
have long respected Motorola as a leading communications equipment
manufacturer. Chris' personal commitment combined with Motorola's
leadership in satellite communications makes Motorola the ideal
partner."
McCaw has worked closely with Motorola for years, first as chairman of
McCaw Cellular Communications Inc., which he sold to AT&T in 1994, and
then at Nextel Communications Inc., where he is a primary shareholder.
When McCaw and his family agreed to invest $1.1 billion in Nextel in
April 1995, he began working with Galvin and the Motorola Land Mobile
Products Sector team to dramatically enhance the technology that
operates Nextel's nationwide digital wireless phone network, which
served 1.6 million subscribers as of March 31.
"Our involvement with Craig and the Nextel team has evolved into a
world-class association that has produced what is now the most advanced
and fastest-growing digital wireless communications system in the
world," Galvin said. "We will build on that relationship and on Craig's
proven ability to attract capital to new technologies to channel
Motorola's experience and expertise into the shared vision of an
advanced global broadband 'Internet-in-the-Sky.' In addition, we have
long-standing admiration for and relationships with Boeing and Matra,
and their presence on the team helps give us the confidence to make this
significant investment."
Boeing's Stonecipher said, "We've been a longtime supporter of the
Teledesic system and have worked with Motorola on the Iridium system.
We think this joint effort makes a tremendous amount of sense and is a
real winner. Commercial space is a key focus for the new Boeing, and
Teledesic is a terrific business opportunity." In April 1997, Boeing
committed to invest $100 million in Teledesic.
Matra Marconi Space's Carlier said, "A global system with global
benefits deserves true global participation. As part of the original
Celestri and now Teledesic's industrial team, we are committed to draw
on the technological strengths of Europe to bring the benefits of the
information age to the entire globe."
Motorola, based in Schaumburg, Ill., is one of the world's leading
providers of wireless communications, semiconductors and advanced
electronic systems and services. Motorola is prime contractor of
Iridium LLC's 66-satellite global wireless personal communications
network, which will offer voice, data, fax and paging services with a
handheld telephone. (Teledesic will serve different markets by providing
broadband communications services
primarily to fixed users.) Other major equipment businesses include
cellular telephone, two-way radio, paging and data communications,
personal communications, automotive, defense and space electronics and
computers. Communication devices, computers and millions of other
products are powered by Motorola semiconductors. Motorola's 1997 sales
were $29.8 billion.
-MORE-
Teledesic-Motorola-Boeing-Matra
Page 3 of 3
May 21, 1998
Boeing, based in Seattle, is the largest aerospace company in the world,
as measured by total sales, and the United States' leading exporter.
Boeing is the world's largest manufacturer of commercial jetliners and
military aircraft, and the largest NASA contractor. The company's
capabilities in aerospace also include helicopters, electronic and
defense systems, missiles, rocket engines, launch vehicles, and advanced
information and communication systems. The company has an extensive
global reach with customers in 145 countries and operations in 27 U.S.
states. Worldwide, Boeing and its subsidiaries employ more than 238,000
people. Total sales for Boeing in 1997 were $45.8 billion.
Matra Marconi Space, the joint venture company formed by Lagardere of
France and GEC of the United Kingdom, is Europe's leading satellite
manufacturer. It employs 5,000 people - 2,300 in France and 2,700 in
the UK, with 1997 revenue of $1.5 billion, covering science and Earth
observation, military observation and communications, telecommunications
and ground infrastructure, launchers and manned flight.
Teledesic and its partners will create the world's first network to
provide affordable, worldwide, "fiber-like" access to telecommunications
services, such as linking enterprise computing networks, broadband
Internet access, videoconferencing and other digital data needs.
Service is expected to begin in 2003. Initially backed by McCaw and
Microsoft Chairman Bill Gates, Teledesic will provide two-way, broadband
network connections through service partners in countries worldwide.
The private company is based in Kirkland, Wash., a suburb of Seattle.
In March 1997, Teledesic (pronounced "tel-eh-DEH-sic") was licensed by
the Federal Communications Commission to build, launch and operate a
global, broadband satellite communications network. In November 1997,
Teledesic cleared its last significant regulatory hurdle when the
International Telecommunication Union's 1997 World Radiocommunication
Conference finalized its designation of international radio spectrum for
use by non-geostationary fixed satellite services, such as those
Teledesic will provide. In April 1998, His Royal Highness Prince
Alwaleed Bin Talal Bin AbdulAziz Alsaud of Saudi Arabia invested $200
million in Teledesic through family trusts.
The plan is subject to the parties entering into definitive agreements
and obtaining necessary governmental approvals.
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