PARIS — The decision by SES Global and Eutelsat to join forces on an S-band satellite payload for mobile television services in Europe provides a guarantee to telephone handset manufacturers, television broadcasters and cellular network operators that they will be able to provide coverage in 2009. But the companies involved concede that the satellite piece of the business is neither the most costly, nor the most complex in Europe’s regulatory environment.
Luxembourg-based SES Global and Paris-based Eutelsat said they would divide the 130 million euros ($164 million) cost of building a 12-meter S-band antenna and related modifications for Eutelsat’s W2A satellite.
W2A, carrying a C- and Ku-band payload, already is under construction by Alcatel Alenia Space and will now be modified to accommodate the S-band gear. The satellite, to be operated by Eutelsat from 10 degrees east longitude, is scheduled for launch in late 2008 or early 2009.
In a joint conference call Oct. 30 on their first-ever joint venture, tentatively named Solaris, SES Chief Executive Romain Bausch and Eutelsat Chief Executive Giuliano Berretta said the risks in S-band remain too high for either company to invest on its own.
SES Global had been considering an S-band payload on its Astra 3B satellite, which has yet to be contracted. Bausch said that idea would be abandoned in favor of the risk-sharing venture with Eutelsat.
The two companies said the investment would begin immediately and will not be held up by the few months needed to secure regulatory approval from European authorities.
Eutelsat had proposed an S-band payload on the European Space Agency’s future Alphasat spacecraft, being managed as a part-commercial, part-governmental project, with a launch scheduled for 2010-2011.
Berretta declined to discuss whether the joint venture with SES Global would affect Eutelsat’s Alphasat proposal. He said that whatever Eutelsat does in S-band will be done jointly with SES Global.
European regulators have allocated 30 megahertz of S-band spectrum for mobile services. The SES Global-Eutelsat project will slice this spectrum into six 5-megahertz beams, one for each of the principal geographic and language areas to be targeted — Britain and Ireland, France, Germany, Italy, Poland, and Spain and Portugal.
The S-band payload will be flexible enough to allocate power among the six beams depending on the amount of demand in each region.
Each 5-megahertz beam will be capable of carrying up to 10 television programs to mobile-television subscribers equipped with S-band handsets. On the day the SES Global-Eutelsat joint venture was announced, Alcatel and Samsung announced that they would jointly develop S-band handsets.
Olivier Coste, president of Alcatel’s mobile broadcast division, said in an Oct. 31 interview that the handsets will be compatible with the DVB-H technical standard that uses the UHF portion of the radio frequency.
Customers outside of the main population centers in the satellite’s coverage area will be able to receive the television broadcasts from the satellite. As they move toward urban areas covered by terrestrial UHF and S-band signals, customers will be able to receive an additional 20 TV channels.
The cost of the terrestrial signal boosters needed to assure coverage in urban canyons and other areas where satellite reception is poor remains a subject of debate in Europe, as it is in the United States, where several companies are building satellite systems similar to what SES Global and Eutelsat’s Solaris venture.
Eutelsat and SES Global will not be joining in that investment, Bausch and Berretta made clear. The two satellite-fleet operators will limit their involvement to the satellite hardware.
Eutelsat Deputy Chief Executive Jean-Paul Brillaud said rollout of the terrestrial network, called Ancillary Terrestrial Components in the United States and Complementary Ground Components in Europe, could cost more than 100 million euros for a single national coverage area.
Coste said the ground network will be a substantial expense, but that its cost depends on what services are offered. “You could have solutions that range from tens of millions of euros to more than 100 million euros” to cover a single nation, Coste said.
But Coste said that installation of the ground network, whatever its actual price tag, “does not kill the business case. We have had detailed discussions with cellular operators and others, and the fact is that the cost of the infrastructure is never the key. You have the cost of content, the cost of subsidizing the handsets, overall subscriber acquisition costs — these are more important cost considerations.”
Coste said Alcatel’s negotiations with potential partners in what the company calls its Unlimited Mobile TV proposal are advancing but he declined to provide details. One hurdle to the business, he said, is the unknown quantity of UHF bandwidth that will be available for a mobile-TV service, and when. Each nation in Europe is following its own schedule.
In the Oct. 30 conference call, Berretta said that the S-band payload also could have uses as a two-way service providing emergency communications in Europe as part of the Galileo satellite-navigation system, now in development.
