Avanti Wins Arbitration Award Against SpaceX

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PARIS — Startup satellite broadband provider Avanti Communications has won an arbitration award against launch-services provider SpaceX relating to Avanti’s decision to scrap a planned launch aboard a SpaceX rocket in favor of Europe’s Ariane 5 vehicle, Avanti said.

London-based Avanti also updated investors on the commercial outlook for its Hylas 1 Ku- and Ka-band satellite, which was launched in November and began commercial service April 4.

In a statement dated April 18, Avanti said the American Arbitration Association of New York awarded the full $7.6 million refund that Avanti had demanded of Space Exploration Technologies (SpaceX), of Hawthorne, Calif., builder of the Falcon 9 rocket originally selected to launch Hylas 1. The Falcon 9’s launch rate has not increased as quickly as planned.

Avanti said its contract with SpaceX stipulated a certain number of successful Falcon 9 liftoffs before the Hylas 1 launch. When SpaceX fell behind its Falcon 9 launch schedule, Avanti contracted with Europe’s Arianespace launch consortium for a launch aboard the European version of Russia’s medium-lift Soyuz rocket.

The European Soyuz was unavailable to perform the launch in time, and Evry, France-based Arianespace agreed to carry Hylas 1 as the second passenger aboard the heavy-lift Ariane 5 ECA rocket.

Avanti said the arbitration award is binding and increases at a preset rate of interest from the day of the award.

Hylas 1 began service with a backlog of 139 million British pounds ($225.2 million), Avanti said. The company has ordered a larger Hylas 2 satellite from Orbital Sciences Corp. of Dulles, Va., with delivery scheduled for 2012. Avanti said Hylas 2’s backlog is already at 28.4 million pounds, not including an option, valued at 113.4 million pounds, for capacity “which is subject to a significant option fee.”

Some 52 percent of Hylas’ backlog is for enterprise and military applications, not including the Hylas 2 option, Avanti said. The rest is for consumer and small-business broadband. Cellular backhaul is likely to be “a significant percentage of backlog,” the company said.

Avanti started its satellite-broadband business by leasing conventional Ku-band capacity on other operators’ satellites and has about 5,000 customers, of which 10 percent have been transferred to Hylas 1. In addition to these customers, Avanti said its service providers have a customer base that Avanti is assisting in the move toward Hylas 1. When these are added into the Hylas 1 customer count, the total is more than 20,000 users, Avanti said.

Avanti had promised investors that Hylas 1 would be at least 25 percent booked when it entered service. The company said it exceeded that goal and had booked 35.1 percent of the satellite’s capacity at “peak utilization rate under Hylas 1 aggregate contracts.”

 

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