Concerns over the U.S. government’s broadband policy was one of the key talking points of the “Financial State of the Industry – Market Trends and Observations” panel at SATELLITE 2010. In particular, Maury Mechanick, counsel, White & Case, was very outspoken in terms of the U.S. government’s reticence to use satellite technologies to reduce the broadband divide across the United States.
   “Satellites seem to have second-class status. We (the satellite industry) don’t get any respect. National Broadband Day is upon us. The formal unveiling of U.S. National Broadband Policy will be unveiled by the FCC tomorrow. The U.S. government does not see satellites as an important element of its national broadband strategy. It is a very stark and sad conclusion,” he said.
   Mechanick said government officials in Washington have a lack of understanding of satellite’s capabilities to solve the broadband equation. “The problem is that the folks in Washington are fascinated by other technologies and focusing on downlink speeds which satellite is unable to deliver. You have a perfect storm against the satellite industry. We need to get people in Washington to think out of the box,” he said.
   Mechanick’s presentation was laced with humor, with one slide labeled, “A Cynic’s Guide to National Broadband Policy.” You should “spend as much as money before it goes away. Secondly, other national priorities should not stand in the way of spending as much on broadband as possible, whether necessary or not. Thirdly, more expensive but less effective may be preferable to less expensive but more effective. Meeting the requirements of ‘uber gamers’ should take precedence over ordinary people. Finally, it is not our job to pick winners and losers, except of course in the case of satellites.”
   Mechanick said the U.S. government could take a lesson from Australia when looking to implement a cost-effective national broadband plan involving satellite. “If you look at Australia, satellite is a critical element of their overall national broadband plan. They will probably fund a dedicated satellite for this purpose,” he said.
   Other panelists concentrated on the overall financial state of the satellite industry. Strong results and access to financing through traditional means, as well as creative partnerships, were the key trends that emerged in 2009.
   Dara Panahy, partner, Milbank, Tweed, Hadley & McCloy, said the results of the big four FSS operators indicated the strong overall health of the satellite industry. “As you see in recently reported results, all of the key FSS operators have had outstanding years. Intelsat, SES, Eutelsat, and Telesat all had outstanding years in 2009,” he said. Such is the strong position of these operators that access to financing is unlikely to be an issue any time soon. “Mature satellite operators will have access to capital markets, even in challenging times,” he added. For new satellite operators, however, this may not be the case. “For smaller scale or new satellite operators, access to capital is challenging. There is a need to resort to creative investment,” Panahy said.
  Peggy Slye, COO of Futron, echoed Panahy’s comments. “The bottom line is that the industry has had a strong performance, and operators have enjoyed some outstanding returns. Demand for satellite services has remained fairly strong, so in the short term, the industry has done well despite some challenging times. New regional players could mitigate near-term FSS capacity crunch. We are seeing a great deal of activity in Asia. The forecast for satellite launches is more moderate. Although we see steady activity, we don’t see major growth. HDTV continues to grow, but rates of growth may level off within five years,” she said.
  Other positive news for the satellite communications sector included about 31 commercial satellites ordered and 27 commercial launches performed in 2009, Panahy said.