News briefs from Issue 197
A round-up of news briefs that featured in Issue 197 of SatelliteFinance.
A round-up of news briefs that featured in Issue 197 of SatelliteFinance.
SATELLITE OPERATORS
Hong Kong-based AsiaSat has warned profits for the year to 31 December 2015 will be 25% less than the corresponding period in 2014, when it posted about HK$788m (US$102m) in gross profit.
The satellite operator blamed the fall on delays in leasing transponders on AsiaSat-6 and AsiaSat-8, as well as depreciation expenses for the satellites. It also cited added interest expenses for its US export credit agency loans and debt raised for a special dividend payment.
AsiaSat, which will release annual results in March 2016, last announced a profit warning in July 2014 over lower revenue, following decreased contract prices and non-renewals, and reduced demand from the US military in the Middle East. It later recorded HK$694m in sales for the six months to 30 June 2014, down 9.6% compared with the corresponding period the year before. Operating profit fell 26% to HK$355m.
British MSS operator Inmarsat has signed an MoU with Turkish satellite operator Turksat to explore opportunities in the defence and aviation sectors. The MoU will strengthen Inmarsat’s links across Caucuses and Central Asia, while building out Turksat’s portfolio beyond the VSAT services it already provides the Turkish government and commercial sector.
“This is an excellent opportunity for both companies to explore new opportunities,” said Inmarsat CEO Rupert Pearce on 11 December. “We value all of our partnerships and hope to develop a longlasting and mutually beneficial strategic partnership with Turksat in the coming months.”
Turksat recently hired an ‘international audit firm’ to prepare for an IPO, according to reports citing the state-owned group’s CEO Ensar Gul in October. The group has reportedly been waiting for regulatory certainty following Turkey’s elections in November. Its latest satellite, the Japanese-built Turksat 4B, was launched in October by Russia’s International Launch Services, following delays stemming from a Proton rocket failure in May.
Indonesian telco and satellite operator Indosat has issued a Rp900bn (US$65m) bond to take advantage of declining yields. Proceeds will be used for refinancing, capex and a third went towards an annual spectrum fee paid to the Indonesian government. BCA Sekuritas, Indopremier Securities and DBS Vickers Securities were underwriters, according to a spokesperson.
In March 2015, Indosat was reported to be studying a US$200m plan for a new satellite to replace its Palapa D bird that is set to expire in 2020. The spokesperson said it was continuing to evaluate options to enhance its satellite business.
NBN, Australia’s public private partnership deploying broadband, has said it will provide wholesale plans with significantly more capacity than originally planned.
The group aims to shift 40,000 customers earmarked for satellite coverage onto fixed-wireless/fixed-line broadband services, and also plans to use unallocated capacity on its second spacecraft to boost its offering. It said the network optimisation enables the Sky Muster spacecraft to provide 150 gigabytes of capacity per month, doubling the previous ceiling.
Gavin Williams, NBN executive general manager of fixed wireless and satellite products, said: “The NBN Sky Muster satellite service will be a game changer for rural telecommunications delivering a new generation of satellite broadband to remote and isolated areas of Australia. “We are freeing up capacity by rolling out more fixed wireless and fixed line broadband and using the unallocated capacity of the second satellite.
“We have worked hard to deliver vastly improved speeds and data allowances compared to services over the interim service, while ensuring we maintain a good quality experience for all satellite users. The satellite capacity is shared between users and there are limits in place so available capacity is managed carefully and fairly.
“NBN is also ensuring that capacity is allocated for public interest uses like education, with the potential for this approach also to be applied for health and emergency services.”
Satellite fleet operator SES has agreed to form a €19.2m (US$21m) seed funding facility with Luxembourg’s government and six other partners to invest in ICT startups. The public private partnership will look for projects in early 2016 that have reached “proof of concept” in areas including satellite telecommunications, cybersecurity, FinTech, big data, digital health and the internet of things.
The other seed funding partners joining SES, which is based in eastern Luxembourg, are Arendt & Medernach, BHS Invest, BIL, État Luxembourgeois, POST Capital, Proximus and SNCI.
SES said: “In order to facilitate transferring new technologies stemming from public research and, in particular, from the Luxembourg University Interdisciplinary Centre for Security, Reliability and Trust (SnT), the seed fund’s objective also lies in investing in promising spin-offs in order to maximise the national economic benefits.”
SPACE SERVICES
Shareholders of Moscow-based broadcaster CTC Media have approved its sale to UTH Russia, which Russian billionaire Alisher Usmanov co-owns with Ivan Tavrin.
CTC Media sold a 75% stake for US$150m in December, and its shareholders are reportedly set to gain a further US$50m for the rest of the group. The deal ensures CTC complies with Russia’s new 20% cap on media foreign ownership. Swedish media firm Modern Times Group was previously CTC’s largest shareholder with a 38% stake.
Natasha Tsukanova, co-chair of CTC’s board, said: “We are delighted that our stockholders have approved the sale of a 75% interest in our operating business in advance of the effectiveness of the foreign ownership limitations imposed by the Russian Mass Media Law. We are also pleased that stockholders have approved a subsequent merger transaction that will allow us to return value in cash to stockholders, assuming receipt of a license from the Office of Foreign Assets Control of the U.S. Treasury Department, which is still pending.”
Finnish network equipment maker Nokia closed the sale of its navigation business Here on 4 December, earlier than its planned Q1 2016 date.
The group sold the assets to German car makers BMW, Audi and Mercedes for around US$2.7bn. In January 2016, the company took control of Franco-American equipment firm Alcatel-Lucent through an all-stock offer worth about US$16.8bn.
Zimbabwean businessman Strive Masiyiwa has announced plans to launch a pay-TV platform called Kwesé TV, which will be built around the satcoms, fibre and mobile capabilities of his telco Econet Wireless.
Masiyiwa, Zimbabwe’s richest man, said in a December Facebook post that the DTH service will be launched in the next few months, offering exclusive sports and entertainment programming to English-speaking African countries. He added that the new TV service will be available “multiscreen”, including smartphones, tablets, computers and traditional TV sets.
“Having infrastructure is one thing, but Kwesé TV’s success will depend on our ability both to acquire and also to develop new, high-quality and unique programming at an affordable price,” he said. Econet has been considering listing its fibre and satellite broadband provider Liquid Telecom, and the Financial Times cited Masiyiwa last year saying he had turned down “multibillion dollar” offers for the group.
StarTV launched DTH pay-TV services in Mexico in December, replacing its TVZac platform that had been available regionally through microwave distribution. The group chose two Eutelsat satellites for the services, which follow government reforms aimed partly at promoting alternative satellite TV offerings in Mexico.
Patricio Northland, CEO of Eutelsat Americas, said: “The development of DTH services in the Americas is a strategic objective for Eutelsat. We are delighted to win the trust of StarTV as a new player in Mexico and to leverage our prime video neighbourhood to broaden the pay-TV offer in Mexico and beyond.”
SPACE SEGMENT
January saw both Surrey Satellite Technology Ltd (SSTL) and Aerojet Rocketdyne announce progress in their bids to develop “green” propellants for smallsats.
A British consortium led by SSTL won a grant from the UK’s innovation agency to help fund the development of a high test peroxide propulsion system, designed to be an eco-friendly alternative to the hydrazine propellant systems commonly used to power smallsats at present. The UK-based manufacturer hopes to have a flight-ready concept ready by the end of 2016.
Meanwhile, Aerojet Rocketdyne has entered into a public-private partnership with NASA to ready the MPS-130 CubeSat propulsion system fuelled by a green propellant, known as AF-M315E. In addition to being greener and cheaper than hydrazine, the rocket- maker believes the technology will increase the in-space mission capabilities of cubesats.
Aerojet Rocketdyne said the system will give cubesats and nanosats similar capabilities to much larger satellites, “such as extending mission life, increasing architecture resiliency, manoeuvring to higher and lower orbits, and performing complex proximity operations and formation flying”.
GROUND SEGMENT
Efforts to upgrade GPS have been hit by a further two-year delay to complete its Operational Control System (OCX), with US Air Force officials now reportedly expecting it to be operational in 2021.
US aerospace and defence firm Raytheon was picked in 2010 to be prime contractor for the ground system, which is expected to rack up a price tag of more than US$2bn in total after being bogged down by delays and cost overruns over the years.
US Defense Undersecretary Frank Kendall was cited telling Reuters in December that the programme “has not been executed very well”, and that the Pentagon would revisit other options if Raytheon’s performance did not improve.
He reportedly added that it was not clear when the Pentagon would assess whether to continue with the group or choose another contractor.
US network equipment specialist Arris has wrapped up its US$2.1bn cash and stock deal for British set top box maker Pace.
The group had planned to complete the transaction in 2015, but was delayed after being asked for more details from the Antitrust Division of the US Department of Justice, as well as regulators in Brazil and Colombia.
Bob Stanzione, the chairman and CEO of Arris who will continue in both roles for the combined group, said: “This acquisition enables us to scale our leadership and innovation to transform global entertainment and communications for millions of people.”
Arris shareholders will own about 76% of the new company, which is incorporated in the UK with operational and worldwide headquarters remaining in Georgia, US. Pace shareholders will hold the remaining 24%.
Satellite fleet operator Intelsat and metamaterials specialist Kymeta have finished initial performance tests of the latter’s flat-panel antennas, using them for maritime and automotive applications.
The pair claim to be the first companies to meet this milestone with a flat panel, software-based antenna. Through software rather than mechanical components, the antennas aim to simplify access to Intelsat’s satellites to speed up hardware installation, and improve the ability to acquire and track signals.
LAUNCH
The US Federal Aviation Administration’s (FAA) Commercial Space Transportation Advisory Committee (COMSTAC) is preparing to vote on whether to recommend lifting restrictions on US-made satellites being exported to India for launch.
At present, legislation from 2005 requires US firms to obtain special waivers from the United States Trade Representative (USTR) before they can take their spacecraft out of the country. Samuel DuPont from the USTR told COMSTAC he had been in talks with India’s government-owned commercial launch services arm Antrix about opening up its services to American satellite operators.
Previous concerns have centred on the fact that Antrix is a state-owned entity and could therefore undercut private US launch providers. COMSTAC is expected to decide whether to recommend the USTR remove the waivers by the end of January.
Virgin Galactic founder Richard Branson has said that the space tourism venture would like to start operating out of the UK’s planned spaceport when it is ready.
The British government is currently assessing five locations as possible sites for the spaceport – Campbeltown, Glasgow Prestwick and Stornoway in Scotland; Newquay in England; and Llanbedr in Wales – and hopes to have a site operational in 2018. Currently based at the Mojave Air and Space Port in California, Branson said Virgin Galactic would like to start operating from the British spaceport as one of the principal operators.
Virgin Galactic also has plans to operate out of Spaceport America, in New Mexico, where it signed on to be an anchor tenant, although its plan to begin operations were hit by a test flight accident in 2014 which resulted in the death of one of the pilots.
Virgin Galactic has also announced that it has procured a Boeing 747-400 jet from sister company Virgin Atlantic to provide a launch platform for its smallsat launcher, LauncherOne. The LauncherOne rocket will be mounted under the 747’s left wing. Virgin Galactic signed a contract last June to use LauncherOne for 39 satellite launches for broadband startup OneWeb.
