Orbcomm Ready To Ship 8 Satellites for Fall Launch on Upgraded Falcon 9

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PARIS — Satellite machine-to-machine (M2M) messaging service provider Orbcomm said the launch of the first eight of its second-generation satellites is likely to occur this fall after its launch services provider, Space Exploration Technologies Corp. (SpaceX), conducts the first three flights of the new Falcon 9 rocket.

The launch, which has been delayed repeatedly, will better position Orbcomm in the competition with exactEarth, majority-owned by Canada’s Com Dev, to line up customers for a global automatic identification system (AIS) maritime surveillance service for coastal authorities.

In a May 9 conference call with investors, Orbcomm Chief Executive Marc J. Eisenberg said Rochelle Park, N.J.-based Orbcomm generated $700,000 in AIS revenue in the three months ending March 31, a period during which it signed four new AIS contracts and issued 13 new AIS-related licenses. That is more than double the AIS revenue from a year ago. Eisenberg said he expects AIS revenue to reach $800,000 for the three months ending June 30.

Orbcomm has two small AIS-dedicated satellites in orbit. All 17 of the second-generation satellites now under construction by Sierra Nevada Corp. of Sparks, Nev., are being fitted with AIS terminals, which receive data on ship identity, heading and destination for forwarding to maritime port authorities.

Eisenberg said the exact date of the Orbcomm launch will depend on the timing and outcome of the inaugural flight of Hawthorne, Calif.-based SpaceX’s upgraded Falcon 9 rocket from Vandenberg Air Force Base, Calif. The flight is scheduled to carry Canada’s small Cassiope satellite into polar low Earth orbit. A second launch of the new rocket, from Cape Canaveral Air Force Station, Fla. — this one carrying the SES-8 commercial telecommunications satellite into geostationary transfer orbit — is now tentatively set for August.

Eisenberg said that the eight Orbcomm satellites are ready to be shipped and are waiting only on a firm SpaceX launch date. If July’s inaugural launch of the new Falcon 9 occurs on schedule and with no major glitches, he said, the Orbcomm launch could occur between October and December.

In addition to providing a fuller AIS capability, the second-generation Orbcomm satellites will provide faster M2M links and better coverage of northern latitudes because they will orbit at higher inclinations relative to the equator than the 26-satellite first-generation system.

The remaining nine second-generation Orbcomm satellites currently under construction are scheduled for launch in mid-2014, also on the new Falcon 9 rocket.

Orbcomm said that as of March 31 it had 777,000 billable subscriber units deployed, a net increase of 19,000 from the same period a year ago. Orbcomm revenue for the three-month period was $16.7 million. That is a 20 percent increase from a year ago but the comparison is complicated by a large back-billing adjustment Orbcomm made with respect to one customer that resulted in a one-time increase in service revenues.

Similarly, a sharp decline in product sales compared with a year ago is largely due to an exceptionally large order in early 2012 from a Japanese customer.

Orbcomm’s purchase of several companies in recent months also makes year-to-year comparisons difficult, but Eisenberg said 2013 should see increased revenue for both services and product sales compared to 2012.

One of Orbcomm’s recent acquisitions, GlobalTrak,  recently won a competition to monitor fuel-transport vehicles in Afghanistan for the U.S. Defense Logistics Agency. Eisenberg said the fact that U.S. troop levels in Afghanistan are coming down should not affect the contract because the same vehicles will be deployed somewhere else, and the need to keep track of their cargo will remain.