BOEING TO BUILD TELEDESIC'S 'INTERNET-IN-THE-SKY'
Aerospace Company Will Serve as Prime Contractor, Assemble
SEATTLE - April 29, 1997 - Teledesic Corporation and The Boeing
Company today announced that Boeing will become an equity partner in
Teledesic and serve as the prime contractor for the company's global,
Boeing will invest up to $100 million for 10 percent of the current
ownership of Teledesic, a private company whose primary investors are
telecommunications pioneer Craig McCaw and Microsoft Chairman Bill
As the prime contractor, Boeing will lead an international effort to
design, build and launch the Teledesic Network. The estimated contract
value will be $9 billion. Using a constellation of several hundred
low-Earth-orbit satellites, Boeing and Teledesic will create the
world's first satellite network to provide affordable, worldwide
"fiber-like" access to telecommunications services such as broadband
Internet access, videoconferencing and interactive multimedia.
The agreement brings together McCaw, Teledesic's chairman, who helped
revolutionize the way people communicate by building the world's
largest cellular phone company before selling it to AT&T in 1994;
Gates, who has built the world's largest computer software company;
and Phil Condit, Boeing's chairman and chief executive officer, who is
leading the world's largest aerospace company into the new
"Boeing shares Teledesic's vision of building a global satellite
network that will extend the most advanced information services to the
far reaches of the earth," Condit said.
"Our relationship with Teledesic is the perfect catalyst for bringing
together all of our historical investments in the space business with
our recent and planned investments in Sea Launch, Rockwell and
McDonnell Douglas," said Condit, who is leading Boeing's merger with
McDonnell Douglas and the recent acquisition of Rockwell International
Corp.'s aerospace and defense businesses.
The boards of directors of both companies have approved the agreement,
which was signed by Alan Mulally, president of Boeing Defense and
Space Group, and David Twyver, Teledesic's chief executive officer.
"Much like our work on the 777, where we had hundreds of suppliers in
dozens of countries, we are committed to assembling a global
industrial team to build and deploy Teledesic's
'Internet-in-the-sky,'" Mulally said.
McCaw said, "The relationship between Boeing and Teledesic is the
perfect collaboration. Boeing and all of the associated suppliers it
brings to the table from around the world will ensure that Teledesic
is a global endeavor."
"While we still have much work to do, Boeing's leadership on
Teledesic's industrial team will help us play a role in bringing the
advantages of the Information Age to the entire world, particularly to
those being left out as matter of cost or geography. We are driven by
both opportunity and obligation to build this business and deliver to
the entire world the same type of opportunity that technology has
provided us," McCaw said.
Teledesic said it selected Boeing as the prime contractor because of
its pioneering work in space; its experience in managing large,
complex global alliances; its commitment to aggressive cost and
schedule goals; and the companies' shared vision.
The announcement comes on the heels of the Federal Communications
Commission's March 14 approval of Teledesic's license to build and
operate the advanced, two-way telecommunications network. Teledesic
had stated previously that the FCC license was a necessary first step
before entering into commitments with industrial, service and
The Teledesic Network will provide switched, broadband network
connections through service partners in host countries worldwide -
from the largest urban centers to the most remote villages. The
network emulates the most famous distributed network, the Internet,
while adding the benefits of high-quality service and
location-insensitive access. Service is targeted to begin in 2002.
With the Teledesic Network, enterprises will be able to connect branch
offices throughout the world to their existing global networks, and
workers will be able to telecommute from anywhere.
Teledesic's satellite constellation will orbit about 50 times closer
to Earth than traditional geostationary satellites. The Teledesic
Network's low orbit eliminates the long signal delay normally
experienced in satellite communications and enables the use of small,
low-power terminals and antennas, about the size of direct broadcast
satellite (DBS) dishes.
Teledesic is a private company based in Kirkland, Washington, a suburb
of Seattle, where The Boeing Company has its headquarters.
# # #
Teledesic Contacts: Roger Nyhus, (206) 720-1739; firstname.lastname@example.org
Bob Ratliffe, (206) 979-4254; email@example.com
Boeing Contacts: David Suffia, (206) 773-0934;
Terrance Scott, (206) 773-5853; firstname.lastname@example.org
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