ROME — Startup satellite broadband provider O3b Networks has recovered from an early loss of backlog following program delays, booking commitments from customers equivalent to more than half of its planned revenue in the first year of operations, O3b Chief Technical Officer Brian Holz said.
Addressing a March 27 briefing here at O3b’s prime contractor, Thales Alenia Space of France and Italy, Holz said the company appears to be reaching a critical mass of market credibility as it approaches the likely June launch of its first four satellites. As of mid-March it had $750 million in committed backlog.
Another four satellites, which like the first four are about completed here, will be launched in September, with initial commercial operations starting in October.
Four more satellites are under construction and scheduled for launch in 2014.
At that point, O3b, based in Britain’s Channel Islands, and its principal shareholder, satellite fleet operator SES of Luxembourg, will reassess the project’s viability and determine whether launching more satellites makes business sense.
O3b’s 700-kilogram satellites use an unusual orbit that the company secured from international radio-frequency regulators following the demise of an even more ambitious satellite broadband project called Teledesic.
O3b picked up the nongeostationary orbit frequencies left by Teledesic, but decided to stick to an orbit 8,069 kilometers over the equator, with the satellites providing bandwidth to a band around the Earth between 45 degrees north and 45 degrees south latitude.
Initial service can start with eight satellites, but as more satellites are added the service improves and the amount of effort required of customers’ ground tracking antennas becomes less.
O3b has said that up to 120 satellites could be fitted into the orbit to provide a broadband connectivity that is superior to most alternatives available to customers in its service area. Oil and gas exploration, cellular backhaul, maritime links to commercial, military and leisure ships and Ka-band Internet Protocol trunking are all markets targeted by O3b.
The gathering optimism about O3b was clearly displayed the week of March 18 by SES Chief Executive Romain Bausch. In the past, Bausch has maintained an investor’s reserve about O3b, saying SES’s at-risk capital is modest even if the project fails. But during the Satellite 2013 conference, Bausch never missed a chance to talk about O3b, going so far as to ask listeners to imagine the quality of service as O3b expands toward its limit of 120 satellites.
Maybe it was the uptick in backlog, or the successful clearance of critical design reviews by system elements, or the equity markets’ new curiosity about O3b, but Bausch is now, by his own admission, “all in” on the project. He said the 12 satellites under construction have the equivalent, in Ka-band, of 1,000 C- or Ku-band transponders.
SES maintains the right to take majority control of O3b in the future, and Bausch has raised the possibility of spinning it off through a stock offering.
Holz’s immediate concern is not a stock offering, but assuring that the final construction proceeds as planned. One early issue was the momentum wheels, which are the same as those that have caused problems aboard mobile satellite service operator Globalstar’s second-generation constellation.
With the assistance of Thales Alenia Space, O3b crafted a momentum wheel test regime of its own to be used after the manufacturer says the wheels are ready to be placed on the satellites.
That turned out to be good planning. Holz said one of the 18 momentum wheels delivered for the first four satellites — four wheels per satellite, plus two spares — was rejected for showing the same kind of friction as affected a Globalstar satellite. Globalstar and Thales Alenia Space have since created a software upload to permit the satellite to operate with fewer momentum wheels.
The second batch of momentum wheels is now in final testing here before being integrated onto the four satellites to be launched in September, he said.
The O3b order is one of three nongeostationary telecommunications satellite constellations for which Thales Alenia Space is prime contractor.
The last six of the 24-satellite order for Globalstar’s second-generation constellation were launched in February. Globalstar and Thales Alenia Space, in conjunction with the French export-credit agency, Coface, are negotiating a final six-satellite batch, but Globalstar Chief Executive Jay Monroe has said the network can make do with just 24 spacecraft and an upgraded ground system.
Iridium Communications’ 81 satellites are now working their way through Thales Alenia Space’s Cannes, France, facility. They will be integrated and tested by Orbital Sciences Corp. of Dulles, Va.
Added to the 12-satellite O3b order, Thales Alenia Space has been working on 117 satellites of about the same size and weight. The company is borrowing from each constellation to create a product, called EliteBus, that it will offer as a multimission platform mainly for low and medium Earth orbits.
Robert Carpentier, Thales Alenia Space’s business development director for Europe, said the company will propose to O3b that it move to EliteBus for any follow-on satellite after the 12 currently on order.