Canadian Firm To Lease Loral’s ViaSat-1 Capacity

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PARIS — Canadian rural-broadband provider Barrett Xplore Inc. has increased its financial commitment to consumer satellite broadband to more than $350 million by exercising an option with Loral Space and Communications of New York, Loral announced June 4.

Woodstock, New Brunswick-based Barrett will now be leasing the maximum amount of capacity Loral had to offer aboard the ViaSat-1 satellite that Loral subsidiary Space Systems/Loral is building for ViaSat Inc. of Carlsbad, Calif.

Loral said Barrett’s lease of ViaSat-1 capacity, which will be spread over the 15-year service life of the satellite, is valued at 262 million Canadian dollars ($252.1 million). Loral said the transaction gives Barrett access to some 12 gigabits per second of throughput capacity.

Barrett in late 2009 agreed to lease more than 10 gigabits per second of throughput on the Jupiter all-Ka-band satellite being built by ViaSat’s principal competitor, Hughes Communications of Germantown, Md. Barrett’s Hughes lease was valued at more than $100 million. Jupiter is scheduled for launch in 2012.

Loral had agreed to purchase the Canadian beams on the ViaSat-1 satellite to seal the ViaSat construction contract for Space Systems/Loral of Palo Alto, Calif.

Loral was unable to sell the capacity to satellite fleet operator Telesat Canada despite Loral’s majority economic ownership of Ottawa-based Telesat, raising the question of whether Loral would be able to sell it at a reasonable rate.

Loral is investing about $60 million as is share of the cost of ViaSat-1’s construction, launch and insurance. The company said it had agreed to invest another $15 million in ground infrastructure to facilitate ViaSat-1 service in Canada.