(FORTUNE Magazine) – When Indonesian engineer Agus Riza installed the first satellite phone in the west Java village of Cidaun, local farmers threw a party. A few hours later, a man on a motorbike rode into town with news of a bus collision five hours away. The village head called the hospital to which the injured had been taken, connected the phone to a loudspeaker, and let everyone hear the names and condition of those hurt. "A day before, it would have taken one or two weeks to get that news," says Riza.

Riza works for Pasifik Satelit Nusantara, a $16-million-a-year Indonesian telco. Last year the company installed some 2,000 satellite phones in villages like Cidaun. The system consists of a satellite dish, a terminal box, and a telephone handset. The gear can be hooked up in an hour, and the calls are cheap--dial anywhere on earth for just 15 cents a minute. Telcos lease time on satellites owned by the likes of Loral and Hughes; Nusantara makes a profit if the phones are used more than 90 minutes a day.

For years, emerging countries like Indonesia, which has just two phone lines per 100 people, have used satellite technology to spread telephony without spending billions on expensive copper or fiber networks. As these countries deregulate, more telephone ventures are looking to rural areas for profits. Israeli Gilat Satellite Networks, the world's second-largest manufacturer of these satellites, has orders from Indonesia, China, Ethiopia, Nigeria, Ghana, Colombia, and Chile. Gilat recently started a subsidiary devoted solely to rural telephony.

Even Iridium, the Motorola spinoff creating a premium satellite-based service for global business travelers, sees dollar signs in serving locales like Cidaun. Last October it launched a rural initiative called Nomad. "The business traveler will be Iridium's prime mover, but the developing world is a substantial market as well," says John Windolph, Iridium's head of advertising. So far Nomad has inked agreements to develop rural networks in Ivory Coast, Mongolia, and Senegal.

--Jeanne Lee