Production delays have forced Globalstar management to lower handset distribution targets from 650,000 to roughly 425,000 for the end of the year, analysts said. Globalstar, which launched its sat-phone service in the United States in early January, should have 80,000 handsets in distribution channels by the end of the first quarter. That compares to 180,000 to 200,000 previously expected by the company. The lower targets were blamed partly on delays at Ericsson. Armand Musey at Banc of America Securities said in a research note that Globalstar could still get around 600,000 phones into distribution pipes by the end of the year, " but that's dependent on manufacturers' willingness to bring on a second manufacturing line by August or September," he said. William Kidd of C.E. Unterberg, Towbin said the firm is "increasingly concerned that the short-term rollout may be slower" than anticipated. "Despite those concerns, we continue to believe that satellite telephony is a valuable endeavor, which warrants investor support and underlies our "buy" recommendation," he said. Globalstar has signed up 18 countries for billable service, using 10 gateways. By the end of the year, Globalstar should have 22 gateways operational, covering 80 countries. Meanwhile, four spare satellites for Globalstar's 52-satellite constellation launched from Cape Canaveral Tuesday. As of press time, things were operating normally aboard the birds.

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Sky Digital At 2.5 Million?

Shares in British Sky Broadcasting soared to record highs Tuesday on expectations the satellite broadcaster would unveil a major Internet move and show that its satellite-delivered digital service continues to grow beyond expectations. Those announcements could come today when BSkyB releases results for the period ending Dec. 31. On Tuesday, BSkyB's ADRs on the New York Stock Exchange closed up more than $9 to $153.94. Analysts said BSkyB could report that it has 2.5 million subscribers for its digital service. If that prediction holds true, new year-end targets could put the satellite powerhouse at between 3.5 and 4 million digital subscribers. In another development, British regulators dismissed a complaint from BSkyB that suggested cable operators were acting unfairly in their bundling of television and telephone offerings. Government officials said they found no reason to act after investigating the satellite broadcaster's claims that cable companies were pressuring customers to take both TV and telephone services.

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FCC Gets $237 Million In Clinton Budget

President Clinton's fiscal 2001 budget allocated $237.1 million for the Federal Communications Commission, an increase of $27 million over the appropriation for fiscal year 2000. Nearly half of the requested fiscal year 2001 increase, around $12 million, will cover mandatory increases for salaries, benefits and inflation. The rest of the requested increase, around $14 million, will pay for new computer equipment, maintenance of electronic filing systems and productivity enhancements for the commission's information technology infrastructure.

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Lucent To Buy Ortel

On Monday, Lucent Technologies agreed to buy Ortel, a provider of fiber-optic parts used by cable and satellite networks, for about $2.95 billion in stock. Lucent will pay 3.135 of its shares for each Ortel share, valuing Ortel at $177.13 a share. Ortel is best known in satellite circles for its MDU work. Lucent said it expects the Ortel purchase to reduce fiscal 2000 earnings by about 8 cents a share.

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COMP WATCH: Agency Rules On HDTV