PARIS — Satellite terminal manufacturer ViaSat Inc. on Feb. 8 said its huge ViaSat-1 Ka-band broadband satellite is under budget and on schedule and that the market for Ka-band satellites worldwide is expanding for consumer, mobile and military use. Company Chief Executive Mark Dankberg said demand is rising so quickly that ViaSat would not rule out ordering a second all-Ka-band satellite even before ViaSat-1 is launched in 12 months.

In a conference call, Carlsbad, Calif.-based ViaSat said its recently purchased WildBlue consumer broadband service had about 425,000 subscribers as of Dec. 31, showing faster growth than ViaSat had predicted when it purchased WildBlue in October.

WildBlue officials earlier last year had said they expected to increase the company’s subscriber base by about 15 percent, to 425,000, by the end of 2009, and to report 2009 revenue of about $210 million. ViaSat said WildBlue’s churn, meaning the number of customers that quit the service, is stable at 2.1 percent per month.

Hughes Communications of Germantown, Md., whose HughesNet consumer broadband service is the chief North American competitor for ViaSat/WildBlue, said in late January it had passed the 500,000-subscriber mark, a 19 percent increase in the past 12 months.

Both Hughes and ViaSat have ordered large new Ka-band satellites to keep up with demand. ViaSat-1 is scheduled for launch in February 2011, with Hughes’ Jupiter satellite scheduled for launch in 2012.

Outside North America, ViaSat has signed contracts to provide gateways and subscriber terminals for the Ka-Sat system under construction by satellite fleet operator Eutelsat of Paris, and for the two-satellite Yahsat program managed by Yahsat of Abu Dhabi. Both of these systems are scheduled to be operational in 2011.

Dankberg said the Ka-band coverage area to be created by ViaSat-1, Ka-Sat and Yahsat will appeal to U.S., European and Middle Eastern defense authorities as they become more acquainted with Ka-band.

The three systems, he said, “really give [military users] the ability to do product and terminal development and tactical testing here [in the United States], staging and deployment in Europe and then operations in the Middle East. That’s actually a big opportunity for us.”

Dankberg said he expected two or more additional Ka-band satellite projects to materialize in 2010.

ViaSat now estimates that its majority stake in the ViaSat-1 satellite — Loral Space and Communications of New York is a 15 percent owner of the system — will cost $300 million for the satellite’s construction, launch and insurance, slightly less than expected in part because of lower insurance costs.

To that figure will be added about $110 million in ground gateway and ViaSat-1 network operations equipment, and around $25 million ViaSat is investing to upgrade its subscriber equipment to prepare for ViaSat-1’s arrival.

ViaSat-1, which like Hughes’ Jupiter is under construction at Space Systems/Loral in Palo Alto, Calif., will have 12 to 14 times the throughput of the current WildBlue-1 satellite for the same per-bit cost delivered to customers.

The Ka-band community ViaSat hopes to create with Eutelsat, Yahsat and others is also laying claim to mobile-broadband applications for commercial aircraft and maritime customers as these markets conclude that Ku-band cannot match Ka-band’s cost-per-bit advantage.

Dankberg said that over time, 10 to 20 percent of ViaSat-1’s revenue is likely to be from military and commercial mobile-broadband customers. He said that figure could change if a large mobile-broadband customer elected to purchase a preset amount of ViaSat-1 capacity in advance.

Even as several companies develop plans to introduce Ku-band broadband connectivity to commercial airline passengers, Dankberg said this business is doomed.

“User expectations for bandwidth have outstripped the ability of Ku-band satellites to economically serve the commercial aviation market,” Dankberg said. “The window for commercial aviation services based on Ku-band FSS [fixed satellite services] economics has closed. Such services ultimately will be short-lived.”

WildBlue’s current service uses the U.S. Ka-band beams on Canada-based Telesat’s Anik F2 satellite in addition to WildBlue-1. Dankberg said WildBlue-1 is operating at about 65 percent of capacity, which in this case means 100 percent of capacity on certain beams directed to high-population areas in the United States, and at far lower fill rates on beams pointed at U.S. rural areas.

A fully flexible WildBlue-1 satellite that could direct capacity where needed could accommodate some 650,000 customers, Dankberg said. ViaSat-1 beams will be trained on those areas of highest demand based on the WildBlue experience.

ViaSat is hopeful that the U.S. Rural Utilities Service (RUS), which is part of the U.S. Department of Agriculture, will act on its announced intention to allocate $100 million of its Broadband Initiatives Program economic stimulus package to support satellite broadband.

Officials from Hughes, ViaSat, Colorado-based EchoStar and other satellite broadband proponents had all but given up on receiving any support for the broadband stimulus package, which appeared tailored for terrestrial communications projects.

But the RUS in January said it was reserving $100 million for rural satellite broadband projects, with the money to be distributed in the form of subsidies to reduce the cost to consumers of their satellite terminals, or to reduce the monthly subscription cost.

Dankberg said that depending on how the subsidies are allocated, ViaSat could use them to stimulate business in rural areas where WildBlue has available capacity.

Peter B. de Selding was the Paris bureau chief for SpaceNews.