• Chinese president meets Chinese, Nigerian businessmen

Mobile L-band satellite radio service is another area being explored for the European market. AAS already supplies the payloads for the US XM satellite radio service. Work is also under way in Ka-band applications, particularly for emergency services. Other potential growth areas are high-definition TV and local TV services (spot beam broadcasts for limited audiences - less than 100,000 people).
Jaeger shares the view that the market will pick up slightly this year, particularly in view of the replacement needs. He is also convinced that there is a huge potential market with institutional users, which has yet to translate into firm contracts. Nonetheless, he feels that awareness is growing, particularly in military circles. The ESA ministerial council meeting in Berlin saw some encouraging declarations, but these will need to be transformed into concrete operations. On the positive side, the Alphasat programme is in progress, as well as ESA's small GEO platform (Artes-11). Germany has invested Euro(s)32 million in the latter effort, just over half of the total funding commitments to date. Berlin's main objective, however, is to help OHB System to develop the Lux platform, which will compete directly with Astrium and AAS offerings.
Among the US manufacturers, only Boeing emerged from 2005 empty-handed. Lockheed Martin (A2100 platform) booked orders for two small satellites (AMC-18 and Bsat-3a) and two medium birds (Sirius-4 and JCSat-11). AMC-18 for SES Global, which is due to be launched this year, was built as a ground backup under an earlier contract. Bsat-3a, for Japanese operator Bsat, is slated for a 2007 launch. Sirius-4, for Nordic Satellite AB (NSAB), which is also due to be launched in 2007, is an A2100AX platform with 52 Ku-band and two Ka-band transponders. Also scheduled for lift-off in 2007 is JCSat-11 for Japan's Jsat Corp. This will be an A2100AX platform with a hybrid (C/Ku band) payload.
For Loral Space & Communications, the highlight of the year was the company's emergence from bankruptcy in November. Space Systems/Loral (FS1300 platform) booked orders for four satellites - XM-5, Galaxy-18, ICO-GEO and TerreStar-1. The latter two are for geostationary Mobile Satellite Services (MSS) applications. ICO-GEO, being built for ICO Satellite Management LLC, is an FS-1300 platform with a 2GHz payload, which will be positioned at 91° West. TerreStar-1, for TerreStar Networks Inc (61% owned by Motient Corp, a provider of terrestial wireless data solutions) likewise features an FS-1300 platform with a 2GHz payload, and an 18m antenna. It will be the first satellite capable of communicating with standard cell phones, thanks to Ancillary Terrestial Component (ATC) technology. It will also be the most powerful commercial telecomsat, with the ability to generate hundreds of beams to cover the USA, Canada, the US Virgin Islands and Puerto Rico. It will be placed in a Canadian orbital slot licensed to TerreStar's Canadian partner, TMI Communications. Launch is set for late 2007, with entry into service to follow by the end of 2008. The contract includes an option for TerreStar-2.
Boeing made up for a disappointing 2005 by sealing its biggest order in nine years in early 2006 - three GeoMobile satellites for Mobile Satellite Ventures (MSV), the former parent of TerreStar. Though the two companies now operate independently, MSV and TerreStar are both owned by the same group of investors. MSV, which already operates the two MSAT satellites, will also use ATC technology. All three of the new satellites will feature 11kW BSS-702 platforms with a 22m antenna for L band, and a 1.5m antenna for Ku band. The first two satellites will cover Canada, the US, Mexico and the Caribbean, while the third (MSV-SA) will add services to South America. Launches are scheduled for 2009-2010.
Orbital Sciences, finally, had a vintage year, with four contracts (PanAmSat-11, Horizons-2, Thor-2R and Measat-1R).
In Russia, the new federal programme includes 62 satellite launches over the period 2006-2015 under the Express, Luch-5A, Yamal, Gonets, Sadko, Gnom, Mayak and Tundra-K programmes. National operator RSCC will account for 15 of these launches (Express series). NPO-PM has already sold several small Express-1000 platforms - Iran's Zoreh satellites, the Luch-5A relay satellite, and Europa-1 for RTRS. The first platform is set for lanch in 2007. Khrunichev is developing the small platform Express-MD. RKK Energia signed a contract for two Yamal-300 satellites at the Moscow Air Show in August 2005. They are due to be launched in 2007. The only constellation in service in Russia today is the Gonets-D messaging and position-finding system.
The major news from Japan last year was the order for the Superbird-7 commercial telecom satellite, which, in a ground-breaking move, was awarded to a Japanese firm, Mitsubishi Electric Corp. This satellite will be based on a DS-2000 platform, already selected for MTSat-2. Weighing in at 5.0t, Superbird-7 will carry 28 Ku band transponders. It is due to be launched in early 2008.
China is poised to bring its new DFH-4 platform into service. The new platform is due to go into orbit this year on Sinosat-2 and NigSatcom-1, and will probably also be used on Venezuela's Simon Bolivar satellite. In December, the Indian government signed an order for Insat-4E/Gsat-6, which will offer mobile multimedia service - Satellite Digital Multimedia Broadcasting (S-DMB). The 2.1t satellite will carry a Band-S payload. Launch is scheduled for early 2008.
Israeli operator Spacecom ordered the Amos-3 satellite from the MBT division of Israel Aircraft Industries. This $170 million craft will feature a hybrid (Ku/Ka band) payload supplied by Alcatel Alenia Space. It is due to be launched at the end of 2007.
Operator consolidation
The consolidation wave continued to wash over the satellite operator sector in 2005. PanAmSat acquired Europestar from Alcatel Space, giving it access to orbital slots at 45° and 47.5° East. Europestar-1 has been renamed PAS-12. Then PanAmSat was itself bought by Intelsat in a $3.2 billion deal that created the world's largest operator of telecom satellites, ahead of SES Global, which had been formed by the merger of GE Americom and Europe's SES Astra.
Intelsat, established in 1964, is the oldest international telecommunications satellite operator in the world. Following the creation of New Skies Satellite (NSS) and privatisation in 2001, the organisation was purchased for $5 billion in October 2004 by Intelsat Holdings, an entity formed at the direction of funds advised by or associated with Apax Partners Worldwide LLP, Apax Partners, Inc., Apollo Management V, L.P., MDP Global Investors Limited and Permira Advisors, LLC. It currently operates a fleet of 28 satellites and reported annual sales of $1.04 billion in 2004. Including PanAmSat, the company operates a fleet of 53 satellites and has pro forma annual sales of $1.9 billion. Intelsat has one satellite on order (IA-9), while PanAmSat has four (Galaxy-16/17/18 and PAS-11). Many observers expect Intelsat to divest part of the PanAmSat fleet.
No sooner had the market digested this mega-merger, than the number two operator, SES Global, announced the acquisition of number eight, New Skies Satellites, in a $1.16 billion cash-only transaction. The latter, spun off by Intelsat in 1998, had inherited five Intelsat satellites, to which it subsequently added NSS-6 (ex-Intelsat-KTV) and NSS-7 (ordered from Lockheed Martin). The company was acquired by The Blackstone Group, a private investment firm, in 2004 for $954 million in cash. The company successfully completed an initial public offering on the New York Stock Exchange in May 2005. NSS recently reported revenues of $240 million (+14%) for 2005, along with a 31% increase in Adjusted EBITDA, to $157 million. SES Global announced sales of Euro(s)1.258 billion (+16.7%), and EBITDA of Euro(s)787 million (+11.9%).
SES Global plans to launch six satellites over the period 2006-2008 - Astra-1KR (Atlas-5, April 2006), AMC-14 (Proton, 2006), AMC-18 (Ariane, 2006), Astra-1L (Ariane, 2007), Sirius-4 (Proton, 2007) and Astra-1M (2008). NSS plans to launch NSS-8 on Sea Launch this year.
Eutelsat eventually proceeded with its IPO in December, after calling off an initial operation planned for October due to market conditions. The IPO was the culmination of a process that got under way in 2000, when the European Commission approved the restructuring proposals transferring the assets of what was then an intergovernmental treaty organization to a privatized entity incorporated in France. Within the company's ownership structure, players from the telecoms community have gradually been replaced by financial investors. The IPO now opens the way to increased flexibility in financing. Says Deputy CEO Jean-Paul Brillaud: "We have achieved the transformation while conserving our commercial effectiveness and pursuing growth. We are satisfied. Now we are in a stronger position to pursue our operational and commercial activities."
For the fiscal year ending 30 June 2005, Eutelsat reported sales of Euro(s)750 million and a backlog of over Euro(s)4 billion. The company predicts growth of around 2% for the year ahead. Brillaud comments that the global market has been stagnant since the Internet bubble burst in 2001, but that the company has maintained growth in excess of 4%. The drop to 2% is not expected to last longer than the "transition year" from analogue to digital broadcasting. "The following three years should see growth back at an annual average 4%," he explains.
Growth is seen coming from continued development of digital TV, the arrival of HDTV in Europe, along with broadband and other added value services. The emerging markets are in central and eastern Europe, Russia, the Middle East, and North and sub-Sahara Africa. Eutelsat is cautious on HDTV prospects, aligning itself with the analysts' predictions of around 150 channels in Europe by 2009. Others feel that HDTV could take off more rapidly, spurred by major events such as the football World Cup in Germany this summer. In the broadband sector, the Dstar service offered by the company's Italian subsidiary, Skylogic Italia, is experiencing rapid growth. New services, such as TV for cell phones, are still in their infancy.
Hot Bird-7A (launched on March 11) and Hot Bird-8 (scheduled for April/May) will ensure continuity of service at 13° East, increase capacity of the Hot Bird position (two transponders), provide a backup in case of transponder failure or even a total loss of a satellite and to provide a contingency in the event of a launch failure. Eutelsat also has plans to redeploy a first-generation satellite to 7° West to provide additional capacity for Nilesat over Egypt.
Eutelsat plans to add three new satellites this year - W-2M, W-7 and W-2A. Three separate RFPs have been issued, and contracts will be negotiated for each individual satellite. Following the incident affecting W-1 in August 2005 (50% of capacity lost), top priority has been given to W-2M - a medium-size bird (28/29 transponders) due to replace W-1 at 10° East. The alliance between EADS Astrium and Antrix, the commercial arm of the Indian Space Research Organisation (ISRO), was recently selected to supply the W-2M satellite. EADS Astrium is prime contractor in charge of overall programme management and will build the communications payload. ANTRIX/ISRO will build the satellite bus, based on the I-3K model, integrate and test the spacecraft. ISRO will also be in charge of early in-orbit operations.
Next in line is W-7, the largest of the three, which will be used to reinforce Eutelsat's position at 36° East, where it will replace W-4 and Sesat. This very successful position has become a hot spot for eastern Europe and Africa. W-2A, finally, will replace W-2 at 16° East.
Market activity so far in 2006 has included the sale by Norway's Telenor of a 4.8% stake in Inmarsat (just over half of its total shareholding) for Euro(s)109.4 million. The company retains a 4.6% stake.
Military users
Military users are also making a significant contribution to telecom market growth. In the UK, the Ministry of Defence is increasingly relying on satellites to communicate with its forces in Afghanistan and Iraq. As of October 2003, MoD communications are handled by a private operator, Paradigm Secure Communications, a subsidiary of EADS Space Services, which supplies turnkey services under a Private Finance Initiative (PFI) contract. Traffic is currently carried by the existing Skynet-4 series; the first Skynet-5 (5A) is scheduled for launch in June 2006, followed by Skynet-5B in 2007. The designated launcher is Ariane, with Sea Launch as a backup. The MoD and other users (including NATO, Canada and Portugal) have expressed their satisfaction with the service being provided by Paradigm ... so much so that a third satellite, Skynet-5C, has been ordered from EADS Astrium. The duration of the contract has also been extended by two years, to 2020.
According to Paradigm, there is no cost increase to the MoD when comparing the common 15-year baseline periods of the old and the new deals. Savings from insurance costs and a cutting-edge refinancing scheme are at the heart of the approach. A three-satellite constellation means better performance, more efficiency, longer services availability, with a concession period extended from 2018 to 2020, the company explains.
Paradigm is also ordering the partial build of a fourth satellite, to be held in reserve. If required, in order to maintain the assurance strategy of having three satellites in orbit, the fourth satellite would be completed and launched in the event that any of the first three satellites were not successfully commissioned after launch. The company notes that the new agreement will also provide the potential for other customers to benefit from increased coverage and capacity. Skynet-5C is scheduled to be launched in 2008.
GOOD VINTAGE FOR INSURERS
2005 was a good year for the space insurance sector. There were no launch failures, only a small number of on-orbit incidents, which do not represent significant sums.
The number of launches insured in 2005 was slightly up from 2004 and is expected to pick up slightly in 2006 - 25-30 launches insured. However, despite this slight pickup in activity, the total volume of premiums is not expected to vary substantially, as the launches essentially involve medium-size satellites, normally insured at around $250-300 million. Useable capacity, on the other hand, is expected to increase from around $400-410 million in 2005 to $470-480 million in 2006. This in turn should bring pressure to bear on launch policy rates, which had already started to ease in 2005. This trend should continue, assuming no major losses.
In spite of this, the overall on-orbit market performance has been negative for the past 10 years, and it will be several more years before things get back into positive territory. However, results for the past two years have at least been moving in the right direction.
ESA, Cnes sign Alphabus agreement
On Thursday 15 March, at the headquarters of the European Space Agency, a co-operation agreement was signed between ESA and the Centre National d'Études Spatiales for the development of Alphabus, Europe's next generation of telecommunication satellites.
The signature of this co-operation agreement follows the signature of a contract in June 2005 between the European Space Agency (ESA), the Centre National d'Études Spatiales (CNES), EADS Astrium and Alcatel Space (which has since become Alcatel Alenia Space) who jointly committed to the Alphabus development programme and to the production of the first flight model around 2009.
The Alphabus programme is supported jointly by ESA and CNES. The agreement which has just been signed establishes the arrangements for cooperation between ESA and CNES in relation to the development and the qualification of a generic line of large platforms for geostationary telecommunication satellites, the provision of a flight model from this generic line and its validation in orbit.
This agreement specifies that CNES will manage the development of this new platform line, with ESA co-financing, the development of the selected European equipment. ESA is therefore the first client for the Alphabus line, thanks to the provision of the first flight model of this platform.
Approved by ESA Member States during the Ministerial conference at Edinburgh in November 2001, Alphabus is the result of the work of an integrated team - ESA/CNES and EADS Astrium/Alcatel Alenia Space- which has designed a product intended for the upper segment of the telecommunication satellites market.
ESA, CNES, EADS Astrium and Alcatel Alenia Space have pooled their technical and financial resources for a joint development programme.
Alphabus will offer Europe reliable solutions matching world demand for very high power satellites and will be commercialised jointly by EADS Astrium and Alcatel Alenia Space starting in 2007.
The Alphabus platform is designed for telecommunication satellites having a payload power consumption of between 12 and 18 kW.
Satellites based on Alphabus will have a lift-off mass of between six and eight tonnes and will be optimised for the European launcher Ariane 5 ECA and the new generation of commercial launchers with a fairing diameter of 5m.
The first flight model of the Alphabus platform, which will be available in 2009, will be offered by ESA to telecommunication satellite operators for their contribution to its in orbit validation. After a call for candidates and a first selection, a definition phase for the first mission of the satellite, named Alphasat, based on this first flight model of the Alphabus platform, will be started with each of the three operators selected (Eutelsat, Inmarsat and Telespazio).
A final selection at the end of 2006 will allow the Alphasat satellite configuration to be frozen for a launch around 2010.

68304201.xml
GOOD VINTAGE FOR INSURERS
Document IBZT000020060915e23100008
Space

Satellite upswing

BY CHRISTIAN LARDIER

4,752 words

1 March 2006

Interavia

IBZT

42

683

English

Copyright 2006 Interavia. All Rights Reserved.
The telecom satellite market is showing the first signs of a recovery that is widely expected to gather momentum in 2006
In retrospect, 2005 looks like it could go down as a transition year for the telecom satellite sector - the market was relatively stable, with real growth expected to take off this year. The year was also marked by the appearance of some new platforms. There are now six EADS Astrium Eurostar 3000 and four Alcatel Alenia Space Spacebus-4000 platforms in orbit, and all are reported to be operating perfectly.
The global market for the whole of last year amounted to 24 contracts worth around $2 billion, though not all of these were open to competition between the different manufacturers. Some contracts were for the orbital equivalent of the aircraft manufacturers' "white tails" - a satellite built for a customer who is ultimately unable to launch it, and which is subsequently placed in storage until a contract has been signed with a new customer. This was the case for Thaicom-4, which remained in storage in Cannes for several years before becoming Agrani-2, then Thaicom-5 (IPStar-1 having in the meantime been redesignated Thaicom-4). Other contracts were only open to certain manufacturers, e.g. satellites for China, which must be "non-Itar restricted", as was the case with Chinasat-6B.
Option confirmations
In some cases, the contract merely concerned the confirmation of an option under an existing agreement, or the launch of ground backup satellites (such as AMC-18). Still other deals involved captive markets, with no competition at all. Examples are Isro's Insats (government satellites) and the Yamal satellites for Gazkom. NigSatcom-1, meanwhile, is in a category of its own - a barter deal involving a Chinese satellite for Nigerian oil; a similar type of deal is now being negotiated with Venezuela.
Taking all these factors into account, Olry Gérard, who is v-p marketing for telecom satellites at EADS Astrium, reckons that only nine of the contracts concluded in 2005 were truly open to competition ... of which his company won two. The first was Astra-1M (5.3t) for SES Astra - a Eurostar-E3000 initially equipped with 36 high-power Ku-band transponders, due to be launched in early 2008. "We are delighted that SES has once again shown its confidence in EADS Astrium, and we are convinced that this contract inaugurates a new phase of cooperation with this leading operator," he comments. EADS Astrium also won the contract to build the South Korean Communications, Ocean & Meteorological Satellite, COMS-1, scheduled to be launched in 2008. This will be a geostationary satellite carrying a Ka-band telecommunications payload, as well as oceanic and meteorological instruments. The contract is a key one for EADS Astrium as it concerns one of the company's two prime target markets - Asia and North America.
The telecom satellite market can be divided into three segments, according to onboard power capability: small (up to 4-5kW), medium (5-10kW) and large (more than 10kW). The past year saw an unusual influx of orders for small platforms, which accounted for a total of 11 contracts - AMC-18 and Bsat-3A from Lockheed Martin, PanAmSat-11, Horizons-2, Thor-2R and Measat-1R from Orbital Sciences, Zohreh from NPO PM, Yamal-301 and -302 from RKK Energia, Insat-4E from Isro and Amos-3 from IAI.
At the other end of the spectrum, orders for top-end "heavy" satellites remain few and far between, so that the market is essentially dominated by satellites in the medium range.
Gérard says that, after the "crisis years" at the start of the decade, he expects a slight market upswing in 2006, with the market moving from an average of 14-15 orders over the past few years to a level in the 18-20 range for the second half of the decade. Forecasts predict orders for a total of 86-88 satellites (over 3,000 36MHz transponders) over the coming five years, worth an estimated $9-10 billion. Two-thirds of these orders will be for replacement satellites, with the remainder generated by new requirements, mostly from the major operators. A significant amount of open competition is therefore expected.
EADS hopes to grab a 20% slice of this pie (measured in dollar value), or the equivalent of three to four satellites per year (two Eurostars, plus one or two smaller platforms). The company has focused efforts on expanding its product offering in order to position itself to submit bids in all segments of the market. That is the reasoning behind its small-satellite alliance with Antrix, the commercial arm of the Indian Space Research Organisation (ISRO). Within the partnership, EADS Astrium is the prime contractor and supplies the payload, while Isro supplies the I2K/I3K platform and performs integration. The product offering is fully competitive with that of Orbital Sciences, as was underlined when the alliance announced its initial success - a contract to supply the W2M satellite for Eutelsat Communications. EADS hopes to win one or two contracts like this each year.
At the top end of the market, the company is partnered with Alcatel Alenia Space in developing the 12-18kW Alphabus platform, which should be available around 2009. Alphabus (see box) is being pursued under the European Space Agency's ARTES technology programme with a view to creating "a European leader to compete on the world market with a unique product in the high power range beyond present European capabilities". The programme also envisages the procurement of the protoflight model of Alphabus as a precursor to support a maiden mission called Alphasat. Eutelsat, Inmarsat and Telespazio have been selected by ESA to pursue so-called "Phase A" activities on Alphasat.
From the point of view of applications, TV broadcasting accounts for half of the global market. The arrival of high-definition TV is expected to give a further boost to this business. In the fixed services sector, there is trend towards increased demand from military/government customers, which is expected to continue over the coming years. Mobile services, meanwhile, have been given new impetus by the arrival of Inmarsat's Broadband Global Area Network (BGAN) - billed as the world's first voice and broadband data mobile communications service accessible anywhere on the planet.
Cautious on broadband
Gérard, however, remains cautious about the future development of broadband applications: "Half of the market will be driven by the major operators, particularly in North America and Asia - regions where we are already present and where we hope to increase our market share. Canada's Telesat has placed its third consecutive order with us, for Nimiq-4, the 14th Eurostar-E3000 platform, which clearly demonstrates customer satisfaction. However, competition remains fierce. The number of players has not changed. Pressure on prices is enormous, and teh dollar exchange rate plays against us."
In response, EADS Astrium is constantly striving to improve competitivity in terms of costs and industrial processes. The Eurostar-E3000 product range has been rationalised. A lot of effort is also going into technology innovation. Plasma propulsion systems are now operating in orbit with excellent results on three satellites, with Li-Ion batteries on two satellites. Meanwhile, the excellent performance of the Inmarsat-4 mobile payload points the way to the development of flexible payloads that can be reconfigured in orbit (active antenna, onboard processor, etc). The company is confident that it is well placed in terms of operational excellence, quality and reliability.
For Alcatel Alenia Space (AAS), 2005 will go down as the year that saw the introduction of its Spacebus-4000 platform, now validated in orbit on AMC-12, Apstar-6, Syracuse-3A and AMC-23. The company also supplied payloads for MTSat-1R, Express-AM2, Express-AM3 and XM-3. The year gone by was marked, too, by the successful entry into service of France's Syracuse-3 military telecoms system, eagerly awaited by the French MoD and NATO. The company also won contracts to supply three satellites (Star One-C2, Thaicom-5 and Chinasat-6B) and the payload for Israel's Amos-3, out of a total of 19 orders in 2005, according to Blaise Jaeger, who heads the Telecom Business Unit at AAS.
In addition, AAS was selected, in partnership with EADS Astrium, as the preferred supplier for Germany's Satcom-BW military telecom satellite. The two companies are also working together on development of the Alphabus heavy platform. Like EADS Astrium, AAS has added a small platform at the lower end of its product range, in partnership with Russia's NPO PM. The alliance combines the Express-AM platform with an AAS payload. The product was short-listed in the Thor-2R competition but did not win the contract.
AAS is scheduled to deliver a total of six satellites in 2006 - Hot Bird-7A (successfully launched by an Ariane 5/ECA on 11 March), Thaicom-5 (Ariane, May), Syracuse-3B (Ariane, June), Koreasat-5 (Sea Launch), Star One-C1 (Ariane) and Galaxy-17 (Ariane). It will also deliver five payloads during 2006 - for MTSat-2 (launched on an H-2A on 18 February), Arabsat-4A (victim of a Proton launch failure on 28 February), Kazsat-1 (Proton, June), XM-4 (Sea Launch) and Arabsat-4B (Proton).
Since its creation on 1 July 2005, AAS has sought to gain maximum leverage from its French and Italian business portfolios. With the Sicral and Syracuse-3 satellites, the company will supply 62% of NATO requirements under the Satcom Post-2000 programme. The Globalstar constellation is also poised for a revival. The eight backup satellites are being prepared for launch on Soyuz or Proton to maintain the constellation in an operational configuration. AAS is also seriously looking at solutions for a second-generation Globalstar system.
In addition, AAS is focusing on new applications, such as multimedia services for cell phones, within a new company jointly operated by the Mobile and Satellite divisions. This type of service is based on hybrid (land- and space-based) networks. Eutelsat has proposed a complementary S-band payload on the three satellites that it plans to order this year. This project is expected to see the light of day in 2008. A similar application is under consideration for ESA's Alphasat programme.
Satellite radio for Europe?