Profile: Staying Ahead of the Curve

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  Space News Business

Profile: Staying Ahead of the Curve

By LON RAINS
Space News Editor
posted: 09 July 2007
02:53 pm ET









Edward D. Horowitz

President and Chief Executive Officer, SES Americom








A




s Ed Horowitz looks beyond the satellite telecommunications industry as it is today with multibillion-dollar revenue streams and hefty profit margins – he sees a business that must be reinvented quickly to keep up with changes that are occurring at a pace that would have been unimaginable not that long ago.



That means thinking about satellite communications in radically different ways and positioning Americom to serve consumers who are demanding ever greater control of the content they buy.

To make sure Americom stays ahead of this fast moving technology curve, Horowitz is eagerly searching for ways to meet his customers’ needs with short-term developments like the new small satellites SES is buying from Orbital Sciences Corp. and long-term plans for incorporating nanotechnology in the company’s satellites and even more importantly on the ground.



“We live in the Internet




age now, not the space age,” he said in a speech earlier this year. “In the Internet




age, mass media is giving way to highly personalized, niche media.” To meet that challenge, Americom is developing new product offerings like IP Prime, which allows the company’s traditional customers, the telecommunications providers, to add video to their existing voice and broadband consumer services. On the government side, for example, SES Americom is developing a comprehensive emergency communications network for those who have to respond to natural disasters or future terrorist attacks.

His deep interest




in technology can be traced back to his undergraduate days when he obtained a B.S. in physics from City College of New York. He later added an MBA from Columbia University. Before joining SES, Horowitz founded EdsLink LLC, a venture fund that provided financing and an array of consulting services to companies in the financial services and cable industries. He




also has held senior executive jobs with Citigroup, Viacom and HBO




.

He spoke with Space News Editor Lon Rains about these and other topics during a recent visit to Washington.







What is the most important thing you can do to make sure Americom is positioned to serve its commercial customers?



The most fundamental change that’s occurring today is the transition from the digital world into one that is Internet Protocol (IP) based. So if you start with the principal that IP is going to be the center point of technology, then everything you do has got to be oriented to support that transformation.



The next game changer may be the introduction of nanotechnology, which will permeate the fabric of everything.

You have to keep up with a rate of change that is exponentially increasing. The rate of change that will occur over the next 25 years will be comparable to the rate of change that occurred over the last 325 years.




How is nanotechnology going to change the satellites you buy?





I don’t have a firm answer yet, but I recently visited Surrey Satellite Technology Ltd in England and they’ve looked at satellites that weigh




1 kilogram and have significant processing capability on board. They have aspirations to build a satellite the size of a credit card. I wouldn’t go that far, but I can envision putting satellites weighing 25 kilograms to 40 kilograms in orbit in swarms where they will interact with one another.



So there will be nanotechnology on board satellites and nanotechnology in the ground systems. Then if you want to push the envelope a little bit further, nanotechnology will probably contribute to enabling the consumer to get what they want, where they want it and how they want it.




How soon could you take advantage of some of this new technology?





Working with our content providers, we think something that is able to customize the offering on behalf of the individual is quite doable within the next turn of Moore’s law – so two-plus years. You have individual user-generated content today that is being generated by the one-billionth of the market whether it is YouTube or whatever.





So you don’t see this as a fad?





This is the direction that we’re going. When it relates to the consumer, it is about user-generated content and content generated and tailored for the individual. They are expressing themselves and they want to personally select what they want to experience.




You recently placed an order for as many as five new small satellites with Orbital Sciences Corp. Is this a trend or is it to meet a particular need?





We looked at our in-orbit fleet and what our customers’ requirements are and set out to define commonality between what exists to serve our customers today and what we want in replacement satellites and for expansion going forward. In total partnership with Orbital – and other companies we worked with on this project – we came up with a baseline design that can accommodate 90 percent of our needs without much modification.



The Orbital program is the beginning of a replacement strategy for current capacity. It takes knowledge and full advantage of the fact that we have C- and Ku- band authorizations at individual orbital positions so it’s a hybrid satellite environment. We’ve added onboard cross-strapping so that we now can offer services that we have not been able to offer in the past. That means you can go up in C-band and come down in Ku-band, go up Ku-; come down C-band.

Because we’ve largely standardized the specifications, we were able to work with Orbital so they can standardize their processes as well. So the overall cost of this satellite with its requirements went down.




How long have you been working with them on this?





We were in industry discussions




about a year and not just with Orbital.




We made the selection some




months ago.





Are we seeing the end of demand for large 702 type satellites?





Yes, there are some missions that go beyond the satellites Orbital is building for us. There still will be satellites that have more complex technical requirements such as moving spot beams and on




board switching. In those cases you will need a bus of a certain size with greater power requirements. That in turn will result in larger spacecraft.







Are you looking at an array of launch vehicles?





We are agnostic to the launch vehicle as long as we fit. So it could be a Land Launch once that gets going, it could be the Soyuz spacecraft out of Kourou once that gets going; it could be the second payload on an Ariane 5 – that is the smallsat payload on an Ariane 5.




There’s been a lot of talk over the last several years about getting the government to be a smarter buyer of commercial services. Are you frustrated by how slowly that process is moving?




Whenever someone says I want my customer to be a smarter buyer, you’re missing something. I think you’ve got to be a smarter seller.



If you fit the Defense Department’s




requirements into a demand pyramid, the bottom half of that pyramid is all about DoD housekeeping – providing digital services to members of the armed services who are X and Y generation who say: “Of course I should have instant messaging when I’m not on the front line. I should have video conferencing and I should have e-mail, absolutely. How could I not have it?” So that’s 50 percent of what DoD requires in satellite infrastructure and, by the way, it’s all IP. We have to figure out how to serve that global need in an efficient way.

The next 30 percent of the pyramid is probably regional and those will tend to be more operationally driven. These are requirements such as serving the unmanned aerial vehicle (UAV) community.

Ten years ago, UAVs delivered a perfect black-and-white picture that was comparable to a fuzzy black-and-white movie 75 years ago. Today’s UAVs are capable of delivering high resolution that is comparable to high-definition television and they require much higher bandwidth.

Once you have that, you can never go back to watching grainy black-and-white television so you always want a bigger, brighter, faster, higher-resolution image.

The last 20 percent in the DoD demand pyramid is really command and control. It’s the nuclear codes, it’s those things that are required in the highest levels of security and where the DoD will be utilizing on its own satellites. It is absolutely appropriate that those needs are met by satellites owned and operated by DoD.

To meet the 80 percent that is addressable by commercial satellites we have to become part of the strategic plan that




Air Force Undersecretary Ron Sega talks about. We have to price the solution in a way that becomes commercially viable for us and cost effective and satisfactory for the customer. And that’s the conversation that we are just beginning. I would classify it as the first chapter of a 10 chapter book.

If you talk to John Grimes, the assistant secretary of defense for networks and information integration, about his vision, it is a complete networked environment in support of the warfighter. Our relevance is not just being a peripheral. Our relevance is to understand and to permeate that network.