Pacific-focused broadband startup Kacific has secured bridge bandwidth to get customers online earlier than planned at the end of 2016, following delays to agree a larger condosat deal with an established operator. An RfP for that satellite could be just a month away.
Pacific-focused broadband startup Kacific has secured bridge bandwidth to get customers online earlier than planned at the end of 2016, following delays to agree a larger condosat deal with an established operator.
CEO Christian Patouraux told SatelliteFinance that the group, which had been talking to several potential partners about launching its own payload in 2017, is now finalising an agreement with “a major satellite operator” to launch HTS services in 2018.
An RfP could be just a month away to find a manufacturer for a Ka-band satellite that can cover around 22 countries around the Pacific, including Indonesia, Philippines, Papa New Guinea and New Zealand.
The search comes at an interesting time for the satellite manufacturing sector, as the ability of firms such as Boeing to participate in tenders is hampered by the closure of Ex-Im Bank, the US export credit agency.
However, contrary to reports that Boeing is out of the race to build the spacecraft, Patouraux said it is continuing to talk with the aerospace giant about the possibility of Ex-Im renewing its mandate in time.
“If it is a matter of weeks then yes we can wait, but we will not be able to delay the whole programme by a month because Ex-Im is not there,” he said.
“We will keep going ahead. If Ex-Im is there in a reasonable timeframe then that’s great, we will continue the discussions with Boeing. If not then Boeing has to find an alternative solution and those are things they are considering at the moment.”
A bipartisan group of House members will try to revive Ex-Im today, however, while it appears they will get enough votes to reauthorise the federal government agency, it is unclear whether the Senate will approve the move.
Ex-Im was shut down in July amid political pressure over its support for ‘big business’. Its absence has been blamed for causing Boeing to lose two other satellite contracts so far: One from Hong Kong’s ABS and another from Azerbaijan’s Azercosmos. Canada-owned but US-based Space Systems Loral was ultimately picked for the latter’s Azerspace-2 bird.
SSL, with support from Export Development Canada, is understood to also be gunning for the Kacific contract, along with a manufacturer linked with French ECA Coface – either Airbus DS or Thales Alenia Space.
In the meantime, Kacific has been funding its operations through three multimillion dollar funding rounds. The latest of these closed in August and is expected to give it a good run into next year and possibly beyond. It is also closing in on a Series A funding round with discussions said to be at an advanced stage.
The company’s intention of generating revenues earlier than previously planned will help boost its larger fundraising efforts, and growing competition in the Pacific broadband market will also help validate the demand it sees for high-speed broadband in the region.
Patouraux revealed that his group has been able to pre-sell 20% of the revenues that the payload will be capable of generating in its 15-year lifespan. This is on top of customers coming online towards the end of next year, who will be paying the same relatively low price for their bandwidth before transferring to the longer-term satellite in 2018. He said bringing customers online earlier than planned will help test how the market reacts to an internet that is 50% – or even in some places five times – cheaper than it is today.
The latest customers that Kacific has announced include telcos in Tokelau, Tuvalu and the Solomon Islands, as well as the government of Kiribati.
Patouraux did not say which operator is providing the temporary bandwidth, although Kacific has spoken about using Inmarsat’s next generation Global Xpress system in the past. The British MSS operator was able to launch full global services for this system only recently, after launching a satellite at the end of August that had been held up by Russian rocket delays.
Société Générale is advising Kacific on its equity, along with regional brokers including New Zealand’s Caniwi Capital and Lennox Capital of Australia.
The group has hired UK-based Portland Advisers to advise on the ECA and debt side.
