Many have associated satellite phone technology with networks like Iridium, which launched in 1998 to great fanfare only to go bankrupt less than a year later. While satellite phone technology (including Iridium) has proven itself within certain organizations, such as those in the government and petroleum sectors, high service-equipment costs combined with low data bandwidth have limited their broader appeal. Startup TerreStar Networks is angling to change things with the launch of its own satellite network that should boast higher data speeds and lower costs.

We spoke with representatives from TerreStar as well as Elektrobit, a company that is developing reference handset designs for the network. Traditional satellite handsets like Motorola's 9505A that operates on the Iridium network have largely been voice-centric affairs with designs that hearken back to the days of analog cellular. In contrast, the form factor of Elektrobit's reference design mimics that of Motorola's Q family of smartphones. Elektrobit's phone runs Windows Mobile and in addition to supporting the TerreStar network also will allow for GSM calls. Elektrobit stated that it's currently engaging ODMs to manufacturer the phone.

From a network standpoint, TerreStar’s satellite service will be IP centric and should allow for data rates that are competitive with services such as HSPA and EVDO (the network's Web site claims "4G service"). Network coverage should span throughout the United States and Canada. Because its reference phone design handsets allow for GSM roaming, TerreStar is currently engaging U.S. carriers to have satellite phone service available as an addition to traditional cellular; TerreStar didn't announce which carrier it's in negotiations with. It also did not announce service costs, though TerreStar expects voice charges to run below $1.00 per minute, which will make it extremely cost-competitive with other satellite services. TerreStar is looking at expanding coverage beyond North America and expects service to be available later this year.