TAMPA, Fla. — Cellular backhaul provider Andesat has ordered Peru’s first dedicated telecoms satellite in a deal with Astranis, which will build a teleport in the country ahead of the spacecraft’s expected 2023 launch.
The contract is worth more than $90 million over the Andesat-1 satellite’s eight-year lifetime. It includes an option for a second satellite that could launch as early as 2024 to provide additional bandwidth.
San Francisco-based startup Astranis is building a business around satellites that, at 400 kilograms, are much smaller than traditional spacecraft in geostationary orbit (GEO), scaled to provide smaller geographies with dedicated bandwidth at lower costs.
U.S.-based telco Pacific Dataport Inc (PDI), Astranis’ first commercial customer, is counting down to the SpaceX Falcon Heavy launch of its Arcturus satellite in spring to provide internet services across Alaska.
Astranis builds and secures a launch for the satellites it develops, providing the capacity through long-term leases.
Andesat plans to use Andesat-1 to expand internet access in remote areas of Peru, while upgrading cellular services in the country from 2G to 4G.
More than eight million people in Peru live in rural communities with no broadband internet access, according to Andesat, which said Andesat-1 would enable about three million Peruvians to access affordable 4G service on their mobile devices for the first time.
About a hundred of the one thousand cell towers that Andesat-1 aims to connect are already operational, and will be upgraded to 5G-ready 4G services, while the rest need to be built from scratch.
Andesat CEO Pablo Rasore told SpaceNews that the company expects to be operating 500 cell towers by 2023. At a rate of 50-80 sites per month, he said the company expects to hit its 1000-site coverage goal a year after launching Andesat-1.
“Sixty percent of the country has no roads, and that’s why there are scattered populations that need service but they don’t have it,” Rasore said.
Three mountain ranges and the Amazon rainforest make connecting cell towers via terrestrial means challenging and costly.
Andesat has been buying capacity from satellite operators including Intelsat, Eutelsat, SES and Telesat to connect these sites; however, Rasore said demand is growing at a rate that makes this business model uncompetitive.
“If the demand from the consumers continues growing as it is, I think that two satellites will be only the beginning,” Rasore added.
Andesat says it started operations as a wholesale satellite services provider in Chile in July 2010, and also has operations in Argentina and Ecuador, with plans to expand into Paraguay and Bolivia.
Astranis seeking one more customer for second batch
Astranis is also building two satellites for U.S.-based in-flight connectivity specialist Anuvu, targeting service in early 2023, which recently secured $50 million for plans to deploy eight satellites in total.
Astranis CEO John Gedmark said the company is in the process of building four “block two” satellites: the two for Anuvu, one for Andesat and another that has yet to secure a customer. He described PDI’s Arcturus as a block one satellite.
“We have multiple interested parties for that fourth satellite” under block two, Gedmark told SpaceNews in a separate interview.
So far, companies ordering Astranis satellites have already been buying capacity from other satellite operators.
Although they are still leasing capacity through Astranis, the startup’s business model offers them longer-term contracts, with increased bandwidth that can be more tailored to their needs.
“That’s just not a model that has existed before,” Gedmark said.
“We’re seeing demand for that in countries all over the world. Also Fortune 1000 companies that would like their own, dedicated satellite assets.”
He declined to disclose more financial details about its satellites.
When Astranis announced the Alaska project in 2019, the company said the deal amount was worth several tens of millions of dollars.
For Peru, Gedmark said Astranis is “investing millions of dollars” to construct a gateway in a first for the company.
Andesat already has a teleport in Peru, in addition to one in Argentina and Chile, and will be responsible for ongoing ground operations once Astranis completes construction.