PanAmSat Corporation today announced that Galaxy
VII, a backup satellite that provides occasional services in the
United States, has ceased transmissions due to the failure of an
onboard system responsible for controlling the spacecraft and
maintaining its position relative to earth. The company does not
expect the satellite to resume operations.

PanAmSat believes the loss of Galaxy VII will not adversely affect
the company’s projected revenues of approximately $1 billion for 2000
or its previously released financial guidance for 2001. PanAmSat
intends to file an insurance claim on the satellite, which is fully
insured at a value of approximately $130 million.

Galaxy VII, a Boeing 601 spacecraft built by Boeing Satellite
Systems Inc., experienced the failure of its backup spacecraft control
processor (SCP) at 1:29 p.m. Eastern time on November 22. Its primary
SCP failed in June 1998, and the satellite continued to provide
service on its backup SCP. In response to satellite technical issues,
PanAmSat implemented a comprehensive satellite expansion and
restoration plan in 1998 that included the launch of four new Galaxy
spacecraft. As part of this plan, the advanced Galaxy XI satellite was
deployed in December 1999 to serve as the permanent replacement for
Galaxy VII at 91 degrees west longitude. Galaxy VII then was relocated
to 125 degrees west longitude, where it provided backup and a small
amount of part-time services.

“PanAmSat took decisive action early on to assure the highest
levels of service and reliability across our fleet. As a result, none
of our full-time customers will be affected by the Galaxy VII
failure,” said R. Douglas Kahn, PanAmSat’s president and chief
executive officer. “We remain focused on expanding our 21-satellite
global network and are confident in the continued performance of our
Boeing 601 spacecraft in orbit.”

Boeing has previously concluded that SCPs on Boeing 601 spacecraft
launched prior to August 1997 contain tin-plated relay switches that
can experience electrical shorts when several factors are concurrently
present. PanAmSat currently operates four satellites (other than
Galaxy VII) with this design. One of these spacecraft, the PAS-4
Indian Ocean Region satellite, experienced the failure of its primary
SCP in November 1998 and continues to provide seamless service on its
backup SCP. PanAmSat plans to launch PAS-10 during the first quarter
of 2001 to serve as the replacement for PAS-4 at 68.5 degrees east
longitude. The three other spacecraft have fully operational primary
and backup SCPs.

PanAmSat is a leading provider of global video and data
broadcasting services via satellite. The company builds, owns and
operates networks that deliver entertainment and information to cable
television systems, TV broadcast affiliates, direct-to-home TV
operators, Internet service providers, telecommunications companies
and corporations. With 21 satellites in orbit today, including the
recently launched PAS-1R spacecraft, PanAmSat has the world’s largest
commercial geostationary satellite network. The company will expand
its global fleet to 23 spacecraft by mid-2001. For more information on
PanAmSat, visit the company’s web site at

NOTE: The Private Securities Litigation Reform Act of 1995 provides a
“safe harbor” for certain forward-looking statements so long as such
information is identified as forward-looking and is accompanied by
meaningful cautionary statements identifying important factors that
could cause actual results to differ materially from those projected
in the information. When used in this press release, the words
“estimate,” “plan,” “project,” “anticipate,” “expect,” “intend,”
“outlook,” “believe,” and other similar expressions are intended to
identify forward-looking statements and information. Actual results
may differ materially from anticipated results as a result of certain
risks and uncertainties, which are more specifically set forth in the
company’s annual report on Form 10-K for the year ended December 31,
1999 on file with the Securities and Exchange Commission. These risks
and uncertainties include but are not limited to (i) risks associated
with technology (including without limitation, delayed launches,
launch failures and in-orbit failures), (ii) regulatory risks,
including the ability to obtain export licenses, (iii) risks of
uninsured loss, (iv) risks associated with the Company’s new Internet
initiatives, and (v) litigation. PanAmSat cautions that the foregoing
list of important factors is not exclusive. Further, PanAmSat operates
in an industry sector where securities values may be volatile and may
be influenced by economic and other factors beyond the Company’s