SINGAPORE — A company that has secured customer commitments from South Pacific island nations for a Ka-band satellite broadband delivery project expects to use those preorders to complete a third round of financing and start production of two Ka-band payloads this year.
Kacific Broadband Satellite said it is in negotiations with two satellite fleet operators that appear willing to host a Kacific Ka-band payload on their spaceraft in time for services to start in 2018.
Addressing the CASBAA Satellite Industry Forum here June 1, Kacific Chief Executive Christian Patouraux declined to name the two fleet operators. Industry officials have said Singapore-based Kacific has been in talks with Chinasat of Beijing and with Sky Perfect JSat of Japan.
Patouraux said Kacific has needed to collect customer preorders as a condition for the next financing round, which he said is designed to carry the company into production of its two payloads.
As with all hosted-payload business models, Kacific’s depends on finding two satellite operators whose fleet development plans coincide with Kacific’s development, and permit the addition of a Ka-band payload. “It takes a great deal of coordination,” he conceded. “But I think we’ll be able to get there with two partners.”
Patouraux said Kacific wants two payloads on two satellites because the in-orbit capacity that is needed would, if placed on a single satellite, be less likely to find a host partner.
Kacific is following a well-marked path among startup operators: Find customers willing to sign bandwidth-purchase commitments, generally with in-service deadlines, and then use these to secure the needed financing.
“In order to get funded, you need a backlog,” Patoouraux said. “It was the same when I was with O3b – we built a backlog of sales. Then you can be credible in front of your equity investors or lenders. We have built a substantial backlog, and now we have started discussions with our lenders.”
Patouraux used to work at O3b Networks of Britain’s Channel Islands, which has 12 Ka-band satellites in medium-Earth equatorial orbit and provides links to telecommunications companies, and to leisure cruise and maritime energy production firms.
Kacific aims to provide broadband connectivity “at the edge of the world, in markets that have been forgotten by a lot of satellite operators. Our core market is the Pacific islands and the Pacific at large.”
Kacific’s challenge is that there is a good reason why many satellite operators have overlooked the region: There are not many people there. Patouraux said that by keeping its capital spending down through two hosted payloads rather than its own satellites, Kacific has been able to offer bandwidth “at a price that is unheard-of in these locations, with a level of service that they have never experienced before.”
Patouraux said lenders and investors are now exercising more scrutiny over new satellite businesses, which is one reason why Kacific has been slow to contract for its payloads and set a credible in-service date.
“We’re in good shape,” he said. “In terms of equity, we have already closed
two rounds of equity last year. We are close to closing another round and we hope to have announcements in the next few months regarding our financing.”
Asked where Kacific would be in a year’s time, Patouraux said: “We will have added more backlog and we’ll have satellite components in the factory.”