[Satellite News 06-17-10] “Right now, I don’t see any other satellite company growing faster than Asia Broadcast Satellite (ABS). We have the pole position in terms of growth in the industry,” Tom Choi, ABS CEO told Satellite News. The company has been engaged acquiring satellite assets at a steady pace throughout the last year, having acquired Koreasat-2 and Koreasat-3 from Korea Telecom (KT) and adding the Agila-2 satellite with the acquisition of Mabuhay Satellite Corp.
    Choi says the deal for Koreasat-3, unveiled in May, came about because despite buying new satellites, the operator was still short of capacity. “We did a deal last year with KT Corporation to buy Koreasat-2, which has a limited number of Ku-band transponders (5.5 FSS + 4 BSS) that we can operate from 75 degrees East due to overlapping frequencies with ABS-1. More or less all the capacity is all spoken for, so we were looking for more capacity to serve our customers, and KT had another satellite that was being replaced which has over seven years of remaining geostationary fuel life. They have the requirement to keep this satellite at 116 degrees East to backup their new satellite, Koreasat-6, so they looking for create opportunities to utilize this satellite while fulfilling their backup requirements. We came to an arrangement to buy the satellite, and redeploy the beams to other parts of the region,” he said.
    Choi does not expect to buy other satellites from KT, although he expects the partnership between the two companies to blossom — even to the point of building future satellites together. “The significance of the Koreasat-3 deal is not only to acquire a valuable satellite asset but also to continue our close cooperation with KT to explore future opportunities together.  For example, as part of the acquisition of the Koreasat-3 satellite, KT is interested to partner with ABS to further develop the 116 degrees East orbital location with future satellites and expand their business internationally from this orbital location.  Before Koreasat-3 reaches the end of its geostationary fuel life, we will work with KT to co-develop the replacement satellite to be located at 116 degrees East.  We are currently working on other strategic deals with KT which we hope to announce soon,” Choi said.
    The deals with KT and Mabuhay were opportunistic in nature, and Choi said it might be hard to find similar deals going forward. “There are assets out there, but it depends if they are available. What has happened with all this global consolidation is that most of the assets are owned by the top four to five satellite companies, and they all have their own plans,” he said. “Fortunately, we have been able to find good partnerships with Mabuhay and KT. I am not sure there will be other deals like that in the future, but we are definitely keeping our eyes open. The deals similar to KT and Mabuhay are hard to find.”
    ABS also likely will do more with Eutelsat Communications. The two companies announced in November a cooperation agreement at 75 degrees East. Within the framework of this agreement, Eutelsat co-located its Eurobird 4 satellite at 75 degrees East with the ABS-1 and ABS-1A satellites. Choi said this cooperation has proved fruitful. “We have loaded customers onto their satellite, and they have loaded customers onto our satellite. There is quite a bit of interest in that capacity. The development of these sorts of partnerships takes time. We highly respect the Eutelsat organization and management team and would be delighted to do more strategic deals with them as we identify other opportunities to work together,” he says.
    The company also plans to launch its ABS-2 satellite in the next couple of years, a major initiative for ABS. “Our current backlog is over $320 million on ABS-2. It is going to be very heavily sold by the time it launches in 2012. I would say several beams will be sold out at launch including the Russia and the Middle East beams. Depending on discussions with partners, our South Asia beam could be sold out as well. I would say we are looking at 70 percent to 75 percent of the capacity sold at launch.”
    While the operator has been successful at building up its fleet over the last year, it did miss out on acquiring ProtoStar’s assets. “I think I am more disappointed that I did not buy the ProtoStar bonds when they were trading at five cents in the dollar. It was an auction. There were more than 10 parties who took part in the ProtoStar-1 auction. Had we had ProtoStar-1, I think we would have put it to good use. I think it would have been great to serve Asia or some of the markets in Africa that we serve now. Our business plan did not depend on winning ProtoStar-1. We are successful without it. I think it made a lot of sense for SES to buy ProtoStar-2, but we didn’t see any opportunity that we could have with ProtoStar-2. ProtoStar-1 was definitely of more interest to us.”