ViaSat-1 to Transform North American Satellite Broadband Market
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Collaborative Effort with Top Ka-Band Leaders to Deliver Significantly Higher Speeds and Bandwidth Rich Internet Media Services to U.S., Canada & Europe Space. Systems/Loral Awarded ViaSat-1 Ka-Band Satellite Contract.
Carlsbad, CA – ViaSat (NASDAQ: VSAT) has executed a contract with Space Systems/Loral, a subsidiary of Loral Space & Communications Inc. (NASDAQ: LORL), to build ViaSat-1, which is expected to be the world’s highest capacity broadband satellite. With the market demonstrating high demand for satellite broadband services, ViaSat-1 is designed to significantly expand the quality, capability and availability of high-speed broadband satellite services for U.S. and Canadian consumers and enterprises. Compared to current Ka-band broadband satellites, the ViaSat-1 satellite, optimized to work in conjunction with ViaSat’s next generation SurfBeam® networking system, is expected to increase the amount of capacity by more than a factor of 10. ViaSat, a world leader in powering innovative satellite broadband platforms, has secured financial commitments from partners of over $100 million to date towards ViaSat-1 and will finance the remainder from cash on hand, future cash flows and available borrowing capacity.
Collaborative Effort of Strategic Partners
ViaSat-1, with a launch planned for early 2011, involves a collaborative effort with top satellite broadband leaders in the market including Loral, Telesat, and Eutelsat. Loral is investing in the Canadian coverage portion of the satellite in anticipation of Telesat using this capacity for the provision of broadband services throughout Canada. The satellite is planned for the Telesat 115 West longitude orbital slot as part of the agreement. Telesat will provide telemetry, tracking & control (TT&C) operations for the satellite. Telesat has been a pioneer in the development of broadband services. Its ANIK F2 satellite was the world’s first major Ka-band spot beam satellite and provided the initial U.S. capacity for WildBlue Communications.
ViaSat-1 is the North American counterpart to Eutelsat’s recently announced KA-SAT, a high capacity Ka-band broadband satellite for Europe planned to launch in 2010. ViaSat and Eutelsat are cooperating closely around ViaSat’s Ka-band SurfBeam networking system and a common wholesale business model to offer service through ISPs, telecommunication companies, and direct-to-home television providers to serve subscribers. Both projects are focused on providing satellite and teleport infrastructure. Eutelsat and ViaSat are already partnering on Eutelsat’s Tooway™ Ka-band service using the HOT BIRD® 6 satellite. Telesat is Canada’s leading broadband satellite provider, also based on Ka-band SurfBeam. The aggregate U.S., European, and Canadian coverage can serve as many as 4 million satellite subscribers with unprecedented speeds and internet media capabilities – creating powerful economies of scale.
Faster Speeds Than The Median for Cable and DSL
Today’s announcement marks a major leap forward in the provisioning of advanced broadband services via satellite. The system is designed to provide a range of speeds that extend well above the median for cable and DSL at retail pricing the same as existing satellite services. Services based on Ka-band technology have proven highly successful in the U.S. There are over 600,000 satellite broadband subscribers today in hard-to-serve areas in the U.S. and Canada, and those on Ka-band have been by far the fastest growing segment. However, high demand for these services has exceeded the bandwidth supply and capped growth. There are simply not enough bits in space to provide service on a par with high speed terrestrial systems and to scale the business.
“It does not have to be that way,” said Mark Dankberg, CEO and chairman of ViaSat. “Day to day consumer internet interactions involving high-bandwidth activities like video and multimedia were not part of the plans when earlier satellite services were designed. We are aiming to give consumers a vastly improved experience based on the most advanced technology on the market. These new capabilities are not only technologically very feasible, they’re also affordable, and the satellites announced by ViaSat and Eutelsat are designed to demonstrate this in a very capital-efficient and scalable manner.”
Eclipsing All Current Satellite Capacity
The amount of bandwidth enabled by ViaSat-1, coupled with ViaSat’s next generation SurfBeam networking system, is unparalleled. Total throughput is designed to be over 100 Gigabits per second, which is more capacity than today’s entire fleet of two-way Ka-, C- and Ku-band capacity over North America combined. Yet the satellite will be built on a heritage Loral 1300 series platform with bus power and mass well within the range of other satellites in use or under construction.
ViaSat To Supply All Satellite Ground Systems
ViaSat will provide its next generation SurfBeam DOCSIS® broadband network infrastructure and subscriber terminals to the U.S., Canadian, and European networks, along with technical and operational support. Over 500,000 SurfBeam Ka-band broadband satellite terminals have shipped, reaching a peak of almost 90,000 units in the last quarter alone. The new satellites will also be used to project existing businesses into Ka- band including enterprise broadband services, video entertainment, mobile broadband, and defense satellite communications.
Dankberg added, “This is a technology opportunity that is right in our sweet spot. We provide ground systems for many commercial and government satellites, and as our activity in satellite payloads has increased, we realized that we could make a major breakthrough by simultaneously designing the spot beam satellite and the ground segment. At the same time, this strategic partnership combines our expertise and economies of scale in broadband modems and Ka-band MMICs, with the benefit of our partners’ extensive experience in designing, launching, and operating advanced satellites and services.”
ViaSat Inc. will host a conference call to discuss this announcement at 10:00 AM Eastern Time on Tuesday, January 8, 2008. The dial-in number is (877) 591-4949 and +1 (719) 325-4929 internationally. A replay will be available for 24 hours beginning at 1:00 PM ET January 8 at (888) 203-1112 and +1 (719) 457-0820 internationally. The replay passcode is 1743586. You can also access our conference call webcast and other material information discussed on our conference call (including any information required by Regulation G) on the Investor Relations Events Calendar page of our corporate Web site (www.viasat.com). The call will be archived and available on that site for at least twelve months immediately following the conference call.
About Loral Space & Communications
Loral Space & Communications is a satellite communications company. Through its Space Systems/Loral subsidiary, the company is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications including direct-to-home television, broadband communications, wireless telephony, weather monitoring and air traffic management. Loral also owns 64 percent of Telesat Canada, one of the world's largest providers of satellite services. Telesat Canada operates a fleet of telecommunications satellites used to broadcast video entertainment programming, distribute direct-to-home video and broadband data services, and other value-added communications services.
About Eutelsat Communications
Eutelsat Communications (Euronext Paris: ETL, ISIN code: FR0010221234) is the holding company of Eutelsat S.A. With capacity commercialized on 24 satellites that provide coverage over the entire European continent, as well as the Middle East, Africa, India and significant parts of Asia and the Americas, Eutelsat is one of the world’s three leading satellite operators in terms of revenues. At September 30, 2007, Eutelsat’s satellites were broadcasting over 2,730 television channels, of which more than 1,000 channels broadcast via its HOT BIRD video neighborhood which serves over 120 million cable and satellite homes in Europe, the Middle East and North Africa. Eutelsat satellites also serve a wide range of fixed and mobile telecommunications services, TV contribution markets, corporate networks, and broadband markets for Internet Service Providers and for transport, maritime and in-flight markets. Eutelsat’s broadband subsidiary, Skylogic, markets and operates services, including Tooway, through teleports in Italy that serve enterprises, local communities, government agencies and aid organizations in Europe, Africa, Asia and the Americas. Headquartered in Paris, Eutelsat and its subsidiaries employ 529 commercial, technical and operational experts from 27 countries.
This press release contains forward-looking statements that are entitled to the protection of the safe harbor contained in the Private Securities Litigation Reform Act. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which ViaSat operates and the beliefs and assumptions of ViaSat. In this press release, these forward-looking statements include, among others, statements regarding the performance of the ViaSat-1 satellite; the construction and launch of the satellite; the completion and timing of the consummation of investments in the project; and the anticipated benefits of the satellite project. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Accordingly, actual results could differ materially from those expressed in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, the ability to realize the anticipated benefits of the ViaSat-1 satellite; pricing pressures and actions taken by competitors; satellite failures or degradations in satellite performance; difficulties in obtaining regulatory approvals; and unexpected expenses related to the project described herein. In addition, please refer to the risk factors contained in ViaSat’s SEC filings available at www.sec.gov, including without limitation, ViaSat’s annual reports on Form 10-K and ViaSat’s quarterly reports on Form 10-Q. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. ViaSat undertakes no obligation to update or revise any forward-looking statements for any reason.
SurfBeam is a registered trademark of ViaSat.
Tooway is a trademark of Eutelsat.
HOT BIRD is a registered trademark of Eutelsat.
DOCSIS is a registered trademark of Cable Television Laboratories Inc.