PARIS – The world’s three principal commercial launch-services providers each conducted five launches in 2006 and plan to conduct at least that many in 2007. Equally important to the companies – Arianespace, International Launch Services (ILS) and Sea Launch – each was able to continue to increase its prices after abandoning a price-war strategy now viewed as counterproductive.
“Prices increased in 2005 and again in 2006,” ILS President Frank McKenna said. “The cutthroat competition [of previous years] only eroded shareholder value.”
The identical launch rates, and the fact that all three are fully booked for 2007 and most of 2008, are among the few similarities among the three companies, which are pursuing different strategies and facing different challenges.
All three recognize that their current success is fragile. With only 20 to 25 commercial satellites to be launched each year, the entry into the market of Indian or Chinese rockets would work changes similar to those that occurred a decade ago when the
government agreed to let Russian launch vehicles compete for commercial payloads.
Not all commercial telecommunications satellites carry
components, but most of them do. Because of that, they are subject to
export license approval. Up until now, that approval has not been granted for Chinese Long March vehicles, nor for
‘s rockets except on rare occasions.
government officials say
is about to be readmitted into the market. Some launch officials believe that
ultimately will follow.
The three commercial companies are pursuing different strategies.
Arianespace and Sea Launch are diversifying their product portfolio to permit them to capture the market for smaller commercial spacecraft.
ILS is going in the other direction, staying out of the bidding for satellites that do not weigh at least 4,000 kilograms – except in special circumstances. With Lockheed Martin now no longer ILS’s principal shareholder and commercial launches of the Lockheed Martin-built Atlas rocket no longer an ILS offering, the company is focusing on a few big-satellite competitions each year.
In recent interviews with Space News the presidents of the three companies described their near-term outlook and strategy:
The Evry, France-based launch consortium orbited nine commercial telecommunications satellites in 2006 on 10 Ariane 5 rockets. The company signed eight commercial contracts in 2006 that it disclosed:
Superbird 7 for Space Communications Corp.
W2M for Eutelsat Communicatoins.
, through a Lockheed Martin Commercial Space Systems contract.
Terrestar-1 for Terrestar Networks.
Turksat-1R for Turksat � A yet-unselected satellite for Arabsat.
Arianespace Chief Executive Jean-Yves Le Gall said a ninth commercial contract was signed in 2006 with a customer that does not want to be named at this time.
The now-proven Ariane 5 ECA rocket, which is capable of simultaneously launching two satellites weighing more than 9,000 kilograms, has enabled Arianespace to return to its roots of only rarely launching telecommunications satellites one at a time.
For 2007, Le Gall expects to conduct five commercial Ariane 5 launches carrying 10 satellites.
Depending on two compatible satellites arriving at
launch base in
at approximately the same time makes Arianespace more sensitive than its two competitors to satellite delays.
Le Gall said current indications are that, in the next few months, satellite delays are not expected to be a large factor. If that is the case, then Arianespace is sold out for 2008.
“Customers have been coming to us asking for 2008 launches, some because they are concerned that their contracted launch dates with other suppliers will not be met,” Le Gall said. “What I tell them is that it will be difficult to find a spot in 2008. I do not want to overbook and be put into a position of telling customers we cannot meet our commitments to them.”
Le Gall expects that in 2007 Arianespace will sign eight launch contracts.
For Arianespace, 2007 is supposed to be the last year when the
hosts only Ariane 5 rockets. In 2008,
‘s Soyuz launch vehicle is scheduled to begin operations there as a complement to Ariane 5. From that equatorial location, the Soyuz is capable of launching 3,000-kilogram satellites into geostationary orbit. The small Vega rocket, which is designed mainly for government science and Earth observation satellites, also is scheduled to debut at Kourou in 2008.
International Launch Services
McLean, Va.-based ILS made a dramatic change in its profile in October when its founding majority shareholder, Lockheed Martin Corp., sold its interests to a hitherto unknown company, Space Transport Inc. of the
British Virgin Islands
. The company is backed by Russian interests.
Frank McKenna, named president after the Lockheed Martin sale, says the new ILS, which sells only Russian Proton-M launch vehicles, will perform only three to five launches per year and will no longer seek the lower-margin business of launching lighter satellites on Proton.
McKenna said focusing on Proton exclusively has honed the company’s business model and permitted ILS to reduce its staff by about 20 percent, to 50 people. A restructuring of the Russian aerospace sector that is expected to continue in 2007 has made Proton’s prime contractor, Khrunichev State Research and
, a bigger, more-capable entity that has greater control of its supply chain.
ILS launched five times in 2006, including one Atlas launch and one Proton-M failure that destroyed the Arabsat 4A satellite.
The company signed four contracts with named customers in 2006:
‘s JSAT Corp.
Nimiq 4 for Telesat
ICO-1 for ICO
Sirius 4 for Sirius Satellite Radio of
The early 2006 failure and the current high Proton-M backlog means ILS might launch as many as six times in 2007, McKenna said, adding that the company has enough space in its manifest to accommodate two additional customers in 2008.
The supply chain issues that have affected some Russian launch operations are not having an impact on ILS, despite a delay in the arrival of an upper-stage Breeze-M engine component that will delay the first 2007 launch slightly. It is now planned for April.
“It’s not a question for us,” McKenna said of the component-supply issue in
. “This venture [ILS] started 14 years ago with Khrunichev and we have the Russian Federal government program underpinning it.”
McKenna said Russian authorities have indicated they would gradually move toward a single Proton configuration using the Khrunichev-built Breeze-M motor instead of the Block-DM stage, built by RSC Energia, which has powered Proton for 40 years.
Sea Launch LLC
Long Beach, Calif.-based Sea Launch in 2006 achieved a long-sought company record with five launches during the year. Given the logistics of taking satellites and personnel to the
floating platform, Sea Launch will be limited to six launches in a given year.
Sea Launch President Rob Peckham said Sea Launch expects to conduct five or six launches in 2007 from its oceangoing equatorial platform. He said Sea Launch is sold out both for 2007 and 2008. The company, which will be inaugurating its Land Launch system from
‘s Baikonur Cosmodrome in
in 2007, signed four contracts in 2006 for the heavy-lift Sea Launch and five for Land launch vehicles, including one Land Launch customer that has not been named.
For the heavy-lift Sea Launch, the customers are:
Thuraya 3 for Thuraya Satellite Telecommunications.
XM-5 for XM Satellite Radio.
The announced Land Launch contracts signed in 2006 are:
Peckham said Land Launch’s first mission, Intelsat‘s PAS-11 satellite, is still scheduled for this summer but that the rest of the Land Launch manifest likely will be delayed by several months as Sea Launch grapples with supply-chain issues at its Russian and Ukrainian suppliers.
Peckham also said that he is unaware of any Russian government policy to stop using the Block DM upper stage for Russian government Proton rocket missions. Sea Launch uses the Block DM for all its launches, for both Land Launch and Sea Launch vehicles. “We have been hearing this for years,” Peckham said. “All I know is that right now we are in line with the Russian government to purchase Block DMs, and I have no indication that a change will occur anytime soon.”