Although most populated areas of the U.S. have some form of cellular coverage, there are still large patches that do not. Also, satellite service could help people who live within network range but go outside it for business or pleasure, Matheson said. For example, a hybrid phone would allow for emergency calls from a car broken down anywhere in the country, he said. The service works anywhere outdoors, or indoors near a window, according to the company.

A phone based on the Infineon SDR is likely to become available toward the end of 2010, and Qualcomm's SDR is expected in 2010 or 2011, according to Matheson. TerreStar wants to offer connectivity to laptops, netbooks and machines as well as handsets. Client gear for those devices will probably come out after the SDRs become available. Machine-to-machine communications eventually could be a big reason to use hybrid cellular/satellite service, Matheson said. Uses might include monitoring of pipelines and electrical grids.

That's where TerreStar is most likely to build a profitable business, according to Yankee Group analyst Phil Marshall. Among consumers, it will be a niche product with startup costs that demand high-volume revenue, he said.

Although technically they can be programmed for many different types of networks, SDRs won't radically change the economics of the handset industry, Marshall said. Most will be programmed for standard wireless technologies, so the cost of tuning one for satellite will remain high, he said.

TerreStar's major investors are Harbinger Capital Partners and satellite TV company EchoStar Technologies. Its satellite cost about $300 million and took about four years to develop and build, according to Matheson. Barring delays, some time after 12:12 p.m. Eastern time on July 1, the craft will be launched into geosynchronous orbit on an Arianespace Ariane 5 ECA rocket from the European Space Agency Spaceport in French Guiana.