PONTE VEDRA, Florida — Mobile satellite services operatoron Aug. 5 said its three-satellite Global Xpress broadband service will not be available globally until mid-2015 because of continued launch delays following the latest failure of Russia’s Proton rocket.
Inmarsat Chief Executive Rupert Pearce said the six-month delay, while affecting 2015 revenue, will have no effect on the business case of Global Xpress, which he said is still expected to generate $500 million in annual revenue within five years of entering global commercial service.
The first Global Xpress satellite was launched in December over the Indian Ocean region. After a period of testing, notably by U.S. special forces in Africa communicating with U.S. bases in Europe, regional commercial service started on July 1 with the U.S. government as the customer.
Global Xpress is an all-Ka-band system that broadcasts in both civil and military Ka-band frequencies. The U.S. Defense Department is viewed as a key future customer.
“The initial contributions from our early U.S. government customers comprise multimillion-dollar annual commitments,” Pearce said in a conference call with investors on the company’s financial results for the first six months of 2014.
London-based Inmarsat said that current use of the company’s classic L-band mobile satellite services fell by 38 percent, to about $96 million, in the first six months of 2014 compared with the same period last year.
Some U.S. government contracts were not renewed because of a dip in overall demand. Others were renewed at lower prices in a market that has become more competitive as Ku-band satellite operators tailor their offers to military users.
In addition, the withdrawal of U.S. forces from Afghanistan has reduced sales to U.S. military users of Inmarsat equipment.
Pearce said that nearly three months after the Russian Proton rocket failed during launch, Inmarsat still has not received the report of the Russian failure review board and thus cannot predict with any certainty when the two remaining Global Xpress satellites will be launched.
He nonetheless ventured to say that the satellites are likely to be launched, in quick succession, toward the end of this year or early in 2015, a scenario that would permit both spacecraft to complete in-orbit testing in time for commercial service by June.
Inmarsat has signed a three-launch contract with Space Exploration Technologies Corp. for launches on’s existing Falcon 9 rocket and the future Falcon Heavy, to be introduced in 2015 according to SpaceX’s current planning.
While one of these launches could in principle be used for the third Global Xpress satellite, the options are for launch dates between the fall of 2015 and the spring of 2016. Only in the event of another major Proton launch delay would SpaceX be used for this third spacecraft, Pearce said.
Inmarsat has two other satellites on order that could be launched by SpaceX. One is a fourth Global Xpress satellite ordered from Boeing Space and Intelligence Systems of El Segundo, California, for use as a replacement in the event of a launch or other failure involving one of the first three; or to expand global service if demand warrants. The other is an S-band satellite ordered by Inmarsat in June in partnership with the Greek Hellas-Sat operator, owned by Arabsat of Riyadh, Saudi Arabia. The Inmarsat S-band payload is designed to develop a market for airline connectivity over the 28-nation European Union for commercial passengers and crews using links assured by a network of signal repeaters on the ground.
Being built byof France and Italy, the satellite, which Inmarsat calls EuropaSat, is scheduled for launch in late 2016. Though nominally slated to launch on the Falcon Heavy, the 5,900-kilogram satellite also could launch on a Falcon 9, Inmarsat has said.
To operate the S-band satellite-terrestrial service, Inmarsat and its future Europasat partners need to secure regulatory approval in all 28 European Union nations.
Pearce said during the call that the company has already received spectrum-use licenses in 10 nations for the satellite broadcasts, and that licenses for the elaborate network of ground repeaters, called a Complementary Ground Component, will take 12-18 months.
Inmarsat has said sharing the satellite platform and launch with Hellas-Sat/Arabsat will limit Inmarsat’s capital spending on the Europasat satellite to $200 million including construction, launch, insurance and operations.
Another $200 million to $250 million will be needed over six years for the ground network.
Pearce said Inmarsat is still undecided about whether the airline-connectivity business model for Europasat will put Inmarsat in direct contact with users, or whether the airlines will want to market the service directly to their customers.
“We have no particular desire to reach all the way through and become a consumer-oriented business,” Pearce said, noting Inmarsat’s history as a wholesaler accustomed to dealing with corporate and government customers.