Iridium is wiretappable. There's a Motorola patent on this, which shows how channels can be split, transmitted over satellite to satellite links, and copied to a monitoring ground station. But this is expensive; not all calls can be recorded.
Even without the military there is a decent sized worldwide market for low-data-rate text email and voice in literally any location on the planet. Iridium works in polar ocean regions with Inmarsat doesn't. It works in fun places like the middle of a desert in Chad or southern Libya. Globalstar was at one time Iridium's closest real competitor but it was a network architecture failure, even before their first generation of satellites developed severe reliability/failure problems. Until very recently Iridium's only real competition for true 'global' coverage was Inmarsat, and Inmarsat is based on geostationary satellites so it's problematic to use at high latitudes. Inmarsat also until very recently did not have a handheld phone product, an Iridium phone was small enough to put in a backpack or small Pelican case while an Inmarsat terminal was the size and weight of a giant 17" gaming laptop.
Beyond this, it's probably possible to snoop on the location of local targets with some unknown degree of accuracy, even if you can't decode their data payload.
Here:
https://events.ccc.de/congress/2014/Fahrplan/system/attachme...
And here:
https://events.ccc.de/congress/2015/Fahrplan/system/event_at...
You just need a handful of local stations to get good coverage, but then it's very trivial.
"This advanced [lash up] technology delivers a gross throughput equivalent to a home user with a 28.8 Kbps dial-up modem. The IMCS uses more than 13.5 million satellite airtime minutes each year."
(See http://www.usap.gov/technology/contentHandler.cfm?id=1935 for the general picture of their telecom.)
multilink PPP over Iridium for polar regions: https://www.ittc.ku.edu/publications/documents/Mohammad2004_...
Cellular phones aren't a substitute, because satellite phones are for precisely where there is no cellular coverage, like less developed countries, remote terrain, and war zones.
Nobody expects people in the street to buy them. I would image most customers are military, other governmental and NGOs, maybe some private companies working in remote places, and a few people with private yachts or who like hiking in very remote places.
For all those customers and use cases, the price for the handset and cost per minute is reasonable. Mainly because there's no substitute, but also because these users are big spenders anyway.
And it doesn't matter that they don't work in buildings, because of course you're normally using these in places without any buildings.
I think the point of OP, and of the other magazine article linked in the comments, is that he hasn't 'grossly underestimated' it in the least bit: yes, you can pay peanuts for Iridium and run an already built Iridium network on those use-cases like the military and occasional people going to war zones and NGOs and hikers, and make the business work that way. But you cannot build one costing billions of dollars based on those use-cases, which is why Iridium went bankrupt in the first place - their business plan was based on covering way more than lost hikers and Afghanistan, it was based on the delusional ideas that businessmen in Paris would pay for it. This was delusional, so Iridium went bankrupt, defaulted on its debts, cost its original investors fortunes, and had to be rescued out of bankruptcy for $25m and refocused on the use-cases which actually did work.
There's also a decent rental market for these phones, so one doesn't have to shell out thousands of dollars--you can get one for $50-75/week + airtime, which is a fairly minor expense if you are already going somewhere so remote you need to be flown in/out.
My brother did some conservation work in really remote areas; I joined him for a little bit. They carried a sat phone, which was used for brief check-ins every few days ("We're fine. Will be moving down the river to site B this afternoon. Bye!") and to coordinate "operations" like receiving supplies or getting picked up by a bush pilot.
Edit: I vaguely recall some of the early marketing being aimed at Gordon Gekko-style businessmen who must always be reachable. I think this never panned of partly due to the cost and partly due to the fact that cell phones got much, much better, both in terms of features and coverage.
Who is the "user"? The story of how the product began development was:
Iridium began as a pet project of Motorola
executive Barry Bertinger and some engineers
in the mid-1980s after the former's wife
famously complained of not being able to
phone the US while on holiday in the Caribbean.
[1] http://www.independent.co.uk/news/business/down-to-earth-rea...
Now to get non-whitelisted sites you can install Opera Mobile. The browser that compresses sites for you. I should have done this before our transatlantic but you live and learn.
Supported sites are basically weather sites. During our transatlantic I basically used weather 4D and passageweather.
Now to your first question you need the Iridium Go app to initiate the connection. Once online any wifi connected device may use it.
Google invested $1B in SpaceX for this very purpose -- To launch on the order of 4,000 satellites to provide worldwide internet.
The article skims on some technical limitation tho, IIRC the number of simultaneous calls that could happen simultaneously in the continental US was in the low thousands, dunno if it improved since launch but that was definitely not mass market, even if the terminals got a lot cheaper...
This is why Iridium has kicked the ass of Globalstar, which was a bent pipe repeater satellite arrangement and relied on dozens of earth stations worldwide, also rendering it unable to provide service in polar regions and in the middle of oceans.
The only other telecom satellites that form backbone/trunk links in space are geostationary and military. The network architecture was WAY ahead of its time considering the design was finalized in 1996-1998 or thereabouts.
It's a little pricey (16 CDN / month, if you dont use it at all, and about a buck a message if you do) -but for peace of mind they are fantastic.
I have a full-on Iridium sat phone. I've only made 2 calls on it. Mostly it it gets used to download weather forecasts and text people back home. Weather option on the Inreach are getting better though they're a long way from good enough for offshore use. There seems to be enough demand that they'll get there though.
http://canmua.net/world/the-fall-and-rise-of-iridium-882149....
A couple problems. First they were way ahead of their time. Secondly, the barrier to entry for space was/is too much.
I think we are on the cusp of changing this dramatically. With SpaceX forcing launch prices down. Micro-satellites becoming a real thing. Plus a possible new company; Vector Space Systems. [1]
[1] http://techcrunch.com/2016/04/26/vector-space-systems-aims-t...
Think about all the times cell service cuts out or isn't seamless: subways, airplanes, boats, basements, etc. Though I admit 100% coverage over every damn square inch of the planet is kind of crazy.
The above was in a recruitment presentation for engineering NCGs. I recall a sinking feeling that I would one day leave academia and work on projects with absurd marketing visions.
Edit: typos