Michele Franci, Vice President, Global Xpress Commercial

[Via Satellite 10-15-13] Inmarsat’s order of a fourth Global Xpress (GX) satellite is key statement as the operator looks to make good on its huge investment program in a series of new Ka-band satellites. The fourth Inmarsat-5 satellite, which will built by Boeing, will have a delivery date of mid-2016. Michele Franci, Vice President, Global Xpress Commercial, Inmarsat told Via Satellite Inmarsat’s confidence in the GX program “continues to grow”. He adds, “We have signed multiple pre-sale agreements and received significant expressions of interest, some of which are tied to the completion of global coverage with three satellites. This has encouraged us to not only move to a strategy to physically insure our global service date with a fourth satellite, but also to consider incremental opportunities that have emerged and could drive enhanced returns via the launch of a fourth satellite. This announcement reflects the fact that we are considering incremental opportunities that could justify the launch of a fourth satellite. Our detailed plans for I-5 F4 will be developed over the coming year.”

The total cost of the option and certain related expenditure will be between $220 million and $250 million for the new satellite. The fourth Inmarsat-5 satellite will have a dual strategic role. Initially the satellite will serve to provide an early available spare in the event of a launch failure of any of the first three Inmarsat-5 satellites. In the event the satellite is not required as a launch spare, Inmarsat is developing an incremental business case to support the launch of the fourth satellite to increase capacity and strategically enhance network coverage. Inmarsat’s GX satellites are being launched by the Proton rocket which has had its issues in recent times, with a launch failure in July of this. Franci says that despite this there has been no operationally significant delay to the schedule of the first GX satellite. He also denies that Proton’s struggles’ have influenced Inmarsat to order this fourth satellite. He says, “Inmarsat will be able to achieve global service launch for GX more rapidly than if a replacement satellite were only commissioned following a launch failure.”

With the launch of the first GX satellite in the near future, the operator has the challenge of making everything is ready ahead of launch. In terms of key issues the operator now faces, Franci says, “Most of the critical pre-launch phases are now behind us and the next operational challenge is getting the satellite to Baikonour. A satellite launch is, of course, a highly complex undertaking but Inmarsat and ILS/Khrunichev, our launch partner, are both highly experienced in this regard. We are pleased with progress on the GX program, which is on schedule and on budget. It is too early to draw any specific conclusions from our GX program to date. Building, launching and operating satellites, as well as creating the infrastructure, systems and services necessary for a new global network, is a process of continual learning and our highly skilled teams review and learn at every phase.”

Inmarsat has secured in excess of 25 percent of its business plan revenues in the first five years of global service, as it looks to make good on its investment in GX. When asked whether the market dynamics have significantly changed since the initial GX announcement, Franci adds, “The market has certainly evolved since we first announced our plans to create the GX network. We have seen other companies making their own announcements, clearly endorsing our strategy. The response from our channel and many major customers has been very positive and they have all welcomed our decision to progress with I-5 F4 too.”