Lack of critical skilled workers delays first ViaSat-3 launch to late summer

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TAMPA, Fla. — A shortage of skilled workers has pushed the launch of the first ViaSat-3 broadband satellite from the first half of 2022 to “late summer,” Viasat said Feb. 3 as the pandemic continues to disrupt the industry’s supply chains.

Viasat executive chair Mark Dankberg said during the company’s financial results investor call that it still plans to bring the satellite online this year.

However, he added “there’s uncertainties along the way,” pointing to how just three months ago it appeared “life was coming back to normal,” before COVID-19’s Omicron variant started spreading across the United States.

Viasat CEO Rick Baldridge said on the same investor call that the company is having to work with a “limited availability of specific critical skill workers,” underlining how COVID-19’s impact on the space industry extends beyond a shortage of certain parts and raw materials.

Kevin Harkenrider, who was promoted to Viasat chief operating officer Nov. 17, recently outlined social distancing and other steps the company is taking to avoid being disrupted by the pandemic in an interview with SpaceNews.

Schedule impacts

A SpaceX Falcon Heavy rocket has been lined up to launch the first high-throughput ViaSat-3 satellite, which aims to cover the Americas from geostationary orbit.

The satellite was initially due to launch in 2019 before pre-pandemic issues with an unnamed component supplier pushed it into 2020. Manufacturing delays related to COVID-19 then knocked the launch into 2021.

The delays have a knock-on schedule impact for the other two satellites in the company’s $2.3 billion global ViaSat-3 constellation. The second ViaSat-3 satellite, designed to cover Europe, Middle East and Africa, is set to launch six months after the first, and the third spacecraft for Asia Pacific six months after that.

California-based Viasat, which is designing ViaSat-3’s payloads for a satellite bus that Boeing is providing, said it does not expect the schedule slip to affect its existing financial outlook materially.

The first ViaSat-3 payload is being readied for thermal vacuum testing at Boeing, the company announced as part of its Feb. 3 financial results.

About 95% of payload units on the second ViaSat-3 satellite have also been installed at Viasat’s facilities, ahead of being shipped to Boeing.

And Feb. 1 Viasat announced a partnership with Australian telco Telstra to build and manage the ground infrastructure for the third ViaSat-3.

Changing competition

Meanwhile, SpaceX recently announced plans to ship antennas in the second quarter to customers who signed up for Starlink Premium, a more expensive service tier for its low Earth orbit broadband network that promises faster speeds for high-demand users.

According to SpaceX, Starlink Premium is geared for offices, storefronts and other “super users across the globe.” 

It marks a significant push into the enterprise market for Starlink, which has focused on consumer broadband applications since starting initial services in 2020.

According to Starlink Premium’s website, its users can expect download speeds of 150-500 megabits per second.

Viasat has said each of its three ViaSat-3 satellites is designed to deliver data and video streaming speeds of more than 150 megabits per second.

Responding to an analyst’s question about ViaSat-3’s ability to attract subscribers once it launches in this changing competitive landscape, Dankberg said it is “a very big market” that can sustain multiple players.

“If you look at what we’re doing on the enterprise side, we tend to be a lot more vertically integrated into each specific market,” he added, “where there’s quite a bit of value-add besides just providing a broadband pipe.”

Viasat made a record $720 million in revenue for the three months to the end of December, up 25% compared with the corresponding period last year.

The growth was driven by broad-based service revenue increases, strong product sales and contributions from two recently acquired businesses: communications firm Rignet and Euro Broadband Infrastructure.

The company’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) soared 10% on the revenue growth to $163 million.

However, Viasat reported a net loss of $6.6 million for the quarter, compared with a net income of $6.8 million in the prior year period. 

The company pointed to factors including expenses related to its planned acquisition of British satellite operator Inmarsat for the drop.

Viasat said it had reached a number of early financial and regulatory milestones since announcing the $7.3 billion acquisition Nov. 8, which will expand its broadband network globally in multiple orbits and spectrum bands if it goes ahead.

These include amending credit facilities for Viasat and Inmarsat to facilitate a deal that comprises $850 million in cash, about $3.1 billion in Viasat equity and the assumption of $3.4 billion of net debt. 

In a letter to shareholders as part of its results, Viasat also said that it has submitted a pre-merger notification under antitrust regulations with the U.S. Department of Justice, “and prepared regulatory filings for many additional jurisdictions around the world.”

Viasat must also secure shareholder approval to buy Inmarsat, and a meeting to vote on a plan is set to be scheduled later this year.