Telenor Sailing into Inmarsat’s Waters with Ka-band Satellite for Ships at Sea

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UPDATED at 10:08 am EDT, Feb. 10, 2011.

PARIS — Norwegian satellite fleet operator Telenor Satellite Broadcasting on Feb. 10 said it will order a new satellite equipped with Ka-band capacity for high-bandwidth transmissions to maritime customers in the North, Baltic and Mediterranean seas. It will be Telenor’s first use of Ka-band and represents a regional challenge to Inmarsat’s planned global Ka-band satellite network.

Oslo-based Telenor said it would order the Thor 7 satellite this spring and that it would be launched in late 2013. Telenor spokeswoman Natasha Keech said in an interview that the company’s corporate parent, Telenor ASA, had approved a budget that is similar to what the company spent on its Thor 5 and Thor 6 satellites, both of which are in orbit.

Telenor has said the Thor 6 satellite, launched in October 2009 and equipped with 36 Ku-band transponders, cost about 1.3 billion Norwegian kroner, or about $225.3 million at current exchange rates. The figure includes the satellite’s construction, launch and insurance for its first year in orbit.

Telenor had directed Orbital Sciences Corp. of Dulles, Va., to order initial parts for what then had been named a Thor 6R satellite, which Telenor planned to build if either the Thor 5 or Thor 6 spacecraft failed at launch. With both healthy in orbit, the Thor 6R contract did not proceed to full construction phase.

Whether Orbital will be able to use that early work to win the Thor 7 contract is unclear. Until now, Telenor had envisioned Thor 7 as an all-Ku-band satellite. With the company’s decision to include Ka-band, Thor 7 likely becomes a larger, more complicated satellite. It will be co-located with Thor 5 and Thor 6 at Telenor’s 1 degree west orbital slot.

Keech said Telenor is aware that Ka-band’s promise of plenty of available bandwidth carries a downside insofar as Ka-band transmissions are more sensitive to rain not a rare event in Telenor’s home Nordic region. But she said the company’s current maritime customers have expressed a willingness to use Ka-band nonetheless on the assumption that the high-bandwidth advantages will outweigh the signal attenuation problem.

Thor 7 also will carry a Ku-band payload to meet growing demand, especially in Central and Eastern Europe, for high-definition television programming.

London-based Inmarsat is building a three-satellite, all-Ka-band constellation called Global Xpress whose principal markets are commercial and military maritime customers. Telenor’s announcement would appear to validate Inmarsat’s business model, but also offer a regional competitor to it.

Telenor’s announcement that it is proceeding with Thor 7 followed its Feb. 8 release of 2010 financial results. The company reported a 5 percent increase in revenue for 2010 and said it expects to start commercial service within weeks from an aging satellite it moved to a new orbital slot.

Telenor, whose Thor satellites are used for television and telecommunications services in the Nordic region and in Central and Eastern Europe, said revenue for 2010 rose to 1.08 billion Norwegian kroner. The company said it increased its high-definition television programming in 2010 and also began testing 3-D television transmissions.

EBITDA, or earnings before interest, taxes, depreciation and amortization, was 70 percent of revenue, which is the same as in 2009.

Telenor in mid-2010 moved its traffic from the aging Thor 3 satellite to the newer and larger Thor 6 spacecraft, which entered operations in early 2010. Thor 3 was moved to 4 degrees west, where it will begin commercial service in February in inclined orbit, meaning it is no longer stable on its north-south axis.

Operating a satellite in inclined orbit saves fuel and can extend a satellite’s useful life by several years. Telenor has said Thor 3 will be able to continue operations for between six and 10 years.

German teleport operator Vicus Luxlink in December agreed to lease six of Thor 3’s 14 Ku-band transponders, with an option to lease two more, to provide Internet service to Vicus customers in the Middle East. These customers will need tracking antennas measuring 2.4 meters in diameter — three or four times the size of a standard satellite-television rooftop dish — to capture Thor 3 signals. Inclined-orbit satellites, viewed from ground antennas, appear to form figure-eight patterns at their orbital slot, rather than appearing to remain in one slot, as is the case for fully stabilized satellites.

Thor 3 is expected to begin commercial operations at 4 degrees west by March.

 

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