Extras Helped Telespazio Seal Turkish Satellite Deal

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Telespazio’s chief executive said his company won a hotly competed Turkish government contract to build an optical reconnaissance satellite because its bid included the creation of a joint- venture company in to develop Earth observation-based services and an offer to sell the nation a radar reconnaissance satellite in the future.

Giuseppe Veredice, whose Rome-based company bested a competitive field that at one time numbered some 10 different bidders, said Telespazio fully expects to sell a radar reconnaissance spacecraft to the Turkish government to complement the optical Gokturk spacecraft. Gokturk is scheduled for launch in 2011.

In a Jan. 14 interview, Veredice said final signatures for the Gokturk program, valued at 250 million euros ($337 million), have yet to be signed between Telespazio and Turkish authorities. But he said he is confident that the contract will be finalized in the coming weeks following ‘s late- December announcement of the Telespazio selection.

But in addition to the Gokturk optical satellite, Telespazio and its bid partner, satellite builder ThalesAlenia Space, gave assurances to Turkish authorities that a high-resolution radar satellite could be sold subsequently, as part of a separate contract that has not been negotiated.

“I see several reasons for the success of our bid,” Veredice said. “The first is the quality of the optical payload sensor that ThalesAlenia Space has made for many satellites and which probably has been put on more satellites than any other optical sensor in the world. A second reason is that ThalesAlenia Space has demonstrated an ability to furnish radar payloads. The customer requested that we state the availability of a radar satellite to complete the Turkish constellation.”

The Gokturk contract includes a satellite integration and test center to be built in , as well as the creation of a joint-venture company with Telespazio and Turkish organizations to develop the Earth observation services market in and the surrounding region.

Veredice said the joint venture will not limit itself to , but attempt to develop downstream Earth observation markets in regions where has more of an influence than or

“We are ready to use the new joint venture to develop markets in the Baltic region, in and anywhere else that can be more easily addressed from ,” Veredice said. “This aspect helped increase the local content of our bid.”

Telespazio is in final negotiations with the Italian Space Agency on the creation of an Italian company, called e-Geos, to market data from ‘s Cosmo-SkyMed radar satellite constellation. Three of the four high-resolution Cosmo-SkyMed satellites are in orbit, with the fourth scheduled for launch in 2010.

The exact ownership division of e-Geos has not been determined, but it is expected that Telespazio will have about a 70 percent share.

Industry officials said one reason Telespazio, and not ThalesAlenia Space, led the bid for Gokturk was because of Turkish resentment of the French parliament’s decision to label as genocide the Ottoman Turkish government’s violence against its Armenian population early in the 20th century.

Europe’s other major satellite prime contractor, Astrium Satellites, has a similar flexibility in making contract bids, having British, French, German and Spanish divisions that can take the lead.

Telespazio is two-thirds owned by Finmeccanica of Italy, and one-third by Thales Group of . ThalesAlenia Space is two-thirds Thales, one-third Finmeccanica.

Veredice declined to confirm whether Turkish resentment of led to Telespazio leading the bid. “Obviously the political aspect is a part of contracts like this, but I think people understand that the Space Alliance [the Finmeccanica-Thales partnership] is more than just and ,” Veredice said.

The Gokturk contract took more than two years from the time it was announced until the December decision. Veredice said Earth observation export possibilities elsewhere in the world, such as and the region, are likely to take just as long.

“The demand remains strong in some regions, although the global size of the market is not that large,” Veredice said. “The main drivers are security and safety applications. Some nations are interested in developing applications, and some also want their own systems. This was the case with and is also the case in some Latin American and Gulf states

The Spanish government recently ordered a radar satellite from Astrium Satellites, and is finalizing a contract with Astrium for an optical satellite as well.