AT&T and satellite operator TerreStar Networks revealed more details about their partnership announced last December to bring integrated devices to market that combine cellular wireless and satellite connectivity as a backup service.

Chris Hill, vice president of product management with AT&T, said the company will be launching the TerreStar Genus dual-mode smartphone across its sales channels in the first quarter 2010, and first responders will be an initial focus.

The device, which resembles a BlackBerry and incorporates AT&T's 2G and 3G technologies along with satellite connectivity, will sell for around $800. TerreStar has not yet announced a manufacturer for the device.

Hill said AT&T customers will buy a terrestrial mobile package and then add the satellite service for $25 per month, paying 65 cents per minute for voice use and $5 per megabyte of data usage. Hill said the pricing is 50% less than traditional satellite services on the market.

The device will run on the new Windows Mobile 6.5 operating system and will offer Wi-Fi, Bluetooth and GPS service. While the device has the inherent ability to seamlessly transfer between cellular and satellite connectivity, AT&T has opted to make the capability a hard transfer, so that the user knows the call is transferring from cellular billing to satellite billing. Customers then receive one integrated bill.

TerreStar long has promised to eliminate the clunky and expensive form factors that sported enormous antennas, thanks to its 17,000-pound, next-generation satellite, the TerreStar 1, which the company launched into orbit in July. Signals now can be received by antennas in smaller form factors, similar to those found in smartphones.

That capability is opening up a new market for AT&T to target the government, energy, utility, transportation, enterprise and maritime users who have need for mobile service outside of traditional cellular coverage areas in the United States, Puerto Rico, the U.S. Virgin Islands and territorial waters. Coverage is available to about 150 miles offshore.

"This will be an interesting option for state and federal agencies to look at this as an alternative to building out private networks in certain areas, such as state parks and border areas," Hill said. "They can incorporate this type of service as part of their infrastructure and provide a statewide interoperability network."

Hill said AT&T is interested in adding more satellite-enabled devices going forward, potentially offering truck-mounted hardware and differing rate plans based on usage scenarios and demand.

Chip-makers Qualcomm and Infineon are incorporating TerreStar's satellite capabilities in their next-generation of chips, enabling handset makers to develop EVDO, WCDMA and LTE phones that are satellite-capable, and possibly bringing more operators in the fold, noted Jeffrey Esptein, president of TerreStar.

"It brings the BOM (build of materials) down significantly when you have our frequency incorporated into chips," Esptein said.