HONOLULU–As long-awaited mobile satellite systems edge closer to enter- ing service and bringing telecommunica tions capabilities to even the most remote villages, a new challenge awaits: Combining local loop systems with satellite gateways.

Although systems such as TRW Inc.’s [TRW] proposed Odyssey Big LEO will connect phones globally, most telephone calls are between people less than 20 miles apart, said Peter Stenzel, vice president of corporate development for Odyssey Telecommunications International Inc. Stenzel made his comments during a panel session at the Pacific Telecommunications Council (PTC ’97) conference.

"There’s a mismatch between this type of implementation and the way people use phones," said Stenzel.

The key is combining wireless local loop systems with satellite gateways, said Stenzel. Such an arrangement would permit less-costly handsets to be distributed to users; a local switch would make the satellite connection.

That could mean a substantial difference in price compared with Odyssey handsets, which are expected to cost at least $500 initially.

Another benefit: Satellite time is used only for long distance, dramatically lowering the cost of most calls.

Asia is a ready market for this kind of technology, said Adi Adiwoso, director of Pasifik Satelit Nusantara (PSN), Indonesia’s first privately owned satellite company. The company is spearheading the development of the Asia Cellular Satellite system (ACeS).

Adiwoso said a single village can generate $50 per day in revenue, even with only fixed cash-based satellite payphones.

That level of revenue is enough to generate a profit, he said. "Don’t underestimate the village."

Louis said he expects a large percentage of Globalstar’s customers to be from developing countries, where economic development depends heavily on rapid deployment of modern communications infrastructure.

The huge demand for telecom should provide ample business for satellite operators looking to meet basic telecom needs. "Supply and demand is still in our favor," said Louie.