[Satellite News 06-01-10] Boeing Space and Intelligence Systems has had its fair share of ups and downs in the last year, winning a multi-satellite contract with Intelsat in July last year but losing out in major contracts for high-powered broadband satellites from ViaSat and Hughes.
    Still, the satellite manufacturer is hopeful it can make more of a dent in the international satellite marketplace in the near future and believes it is a strong contender for more international business. Satellite News spoke with Jim Simpson, vice president of business development for Boeing Space and Intelligence Systems. about the company’s business potential in the manufacturing market.

Simpson: In 2009, we introduced the Boeing 702MP satellite after four years of development. This system complements our 702HP, which is the basis for our mobile SkyTerra satellite and our recent DirecTV satellites. Because of the expanded market availed by the two satellite systems, we were successfully able to capture four commercial satellites and a hosted payload as part of our contract with Intelsat. This pivotal change in our product strategy further positions us as a strong competitor for several upcoming commercial satellite awards, including several international awards. While we do not name those, for competitive reasons, we are strong contenders for at least two to three awards for as many as six satellites made up of 702MPs and 702HPs and hosted payloads as well, which will be awarded in Q3 or Q4 2010. If successful with our pursuits, this will be a very successful year.

Simpson: Our commercial model has been pretty consistent since 2003 at around 15 to 25 [geostationary] satellites per year. We believe that this model will continue through 2020. 

Simpson: With the cancellation of TSAT, we are seeing the government moving to a more distributed architecture of advanced EHFs, WGSs and commercial satellites for their communication needs. The emergence of hosted payloads as a potential to augment military communications, space surveillance, missile warning or Earth observation could push more activity to the commercial side, however, a fundamental core of government controlled and owned systems is required for the baseline requirements and economics. If a system is fully utilized, it is always more economical to buy rather than lease. However, if one only needs a partial satellite capability or requires the capability for a short time span, leases and commercial services provide a economical complement. 
    With that said, we are moving to a more balanced portfolio of government and commercial satellites. Presently, our portfolio is heavily driven by government — with about 90 percent government and 10 percent commercial. In the next few years, our goal is to move to greater balance in the 70 percent/30 percent range. We believe our expertise in both commercial and government markets enables us to be well suited for hosting government-utilized payloads on commercial systems and provides an adjacent market.

Simpson: The requirements of TSAT have not gone away, but the approach to meet those requirements is related to more WGS satellites, more Advanced EHF satellites, commercial satellites, hosted payloads and the potential advent of single mission free-flyer satellites. This distributed architecture and other alternate architectures are being evaluated to enable an economical approach to meet the needs of the warfighter and is a significant departure from the large multi-mission TSAT approach.

Simpson: The ITAR rules are evolving to meet the evolving commercial and government needs. ITAR in programs that we compete for is typically not a primarily selection criterion. The real issue with ITAR is the impact regarding second and third tier suppliers. The restrictions in providing products outside of the United States limits the market and increases the prices, hence making us potentially less competitive. Furthermore, it forces other countries to create their own sources, which then enable them to compete against us and furthers their technology. We believe that this is an area that we need to look at more carefully in regards to what we are really protecting and how it is impacting the aerospace industrial base.