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| News For Immediate Release |
| Contact: John Cunningham Globalstar, L.P. |
GLOBALSTAR AND ROSTELECOM TO PROVIDE MOBILE SATELLITE SERVICES IN RUSSIA THROUGH JOINT VENTURE COMPANY GLOBALTEL
Russians to Gain Access to Modern Global Telecommunications
MOSCOW, May 22, 1997 -- Globalstar (NASDAQ:GSTRF) and Rostelecom JSC announced today an agreement that paves the way for Russians to gain access to advanced telephony services through Globalstar's worldwide mobile satellite system beginning in late 1998.
GlobalTel (Globalstar Space Telecommunications), a joint stock company founded Rostelecom JSC, the largest Russian telecommunications operator, and Globalstar LP, will act as the exclusive provider of Globalstar services in Russia. GlobalTel is the owner and operator of the Globalstar ground segment in Russia, and will be responsible for interconnecting the Globalstar system with Russia's existing wireline and wireless infrastructure. GlobalTel is majority owned by Rostelecom.
While preparing the agreement, Mr. Oleg Belov, Director General of Rostelecom JSC, remarked: "This project will greatly enhance the development of mobile satellite services in Russia and further satisfy the demand for telecommunications services by Russian users."
Bernard L. Schwartz, chairman and chief executive officer of Globalstar and Loral Space & Communications Ltd. (NYSE:LOR) commented: "We believe this agreement solidifies Globalstar's mobile satellite services leadership in Russia and represents a key ingredient in our strategy to provide satellite-based services throughout the world."
GlobalTel expects to serve more than 150,000 subscribers in Russia by the year 2002. Russia's telephony penetration rate is currently less than 20 per cent, and some 40,000 rural Russian communities are in need of improved telecommunications services.
Subscribers in Russia will use mobile terminals, similar to today's cellular phones, with dual-mode capability so users can switch from satellite telephony to conventional cellular telephony as required. As well as using mobile terminals, some users in Russia's rural and remote areas will make or receive calls through fixed-site telephones, similar either to phone booths or ordinary wireline telephones. Subscriber terminals will communicate through a Globalstar satellite to one of Russia's gateways (ground stations ), that in turn will connect calls into Russia's existing telecommunications network. Russia's initial Globalstar gateway will be located at a site near Moscow and is due to be fully operational by the start of Globalstar service in Russia in late 1998.
Including Russia, Globalstar now has service provider agreements in 104 countries, and licenses in 14. The $2.6 billion Globalstar system, comprised of 48 low-earth-orbiting (LEO) satellites and a global network of ground stations, will allow people around the world to make or receive calls using hand-held, vehicle-mounted and fixed-site terminals. Globalstar will also provide data transmission, messaging, facsimile and position location services.
Privatized in 1993 as a joint stock company, Rostelecom is Russia's nationwide domestic and international long-distance public switch telephone network operator. Rostelecom provides international voice telephony, telex, data transmission, video conferencing, digital circuit leasing, digital transit, and TV/radio transmission services throughout Russia
Globalstar, led by Loral Space & http://www.globalstar.com Communications Ltd., is a partnership of the world's leading telecommunications service providers and equipment manufacturers, and includes AirTouch Communications, Alcatel, Alenia, DACOM, Daimler-Benz Aerospace, Elsag Bailey, France Telecom, Hyundai, QUALCOMM Incorporated, Space Systems/Loral and Vodafone. For more information visit the company's web site at .
Loral Space & Communications Ltd. is a high technology company headquartered in New York that concentrates on satellite manufacturing and satellite-based services. Loral manages and is the largest equity owner of both Globalstar, in which it holds a 38% interest, and Space Systems/Loral, a leading manufacturer of large, high-powered satellites for telecommunications and environmental applications, in which it currently holds a 51% interest.
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