Iridium bankruptcy and revival (1999-2001)
Iridium, a 66-satellite mobile phone network backed by Motorola, filed for bankruptcy in August 1999 after burning $5 billion and failing to sign up subscribers. A group of investors bought the constellation for $25 million in 2000 and signed a Defense Department contract that kept the satellites flying. The company is now valued in the billions.
The Pentagon's anchor contract saved the constellation from being deorbited. Investors who bought the assets for cents on the dollar built a profitable business.
Iridium showed that mobile satellite spectrum and an in-orbit fleet are worth far more than the equity value of the company holding them, especially when an anchor customer commits.
Globalstar's path mirrors Iridium's: a near-death company kept alive by an anchor partner (Apple, then Amazon) that values the spectrum more than the original equity holders did.
