Thomas Choi, co-founder and CEO of ABS

[Via Satellite 11-10-2015] ABS is bringing what could be a step-change to satellite telecommunications by ushering in what it calls Ultra-High Throughput (UTS) capacity with its future satellites. ABS CEO Tom Choi told Via Satellite that the operator’s next satellite, ABS 8, will feature this new technology, and that the company already has customers desiring to use it.

ABS launched its most recent satellite, ABS 3A, on a SpaceX Falcon 9 rocket along with co-passenger Eutelsat 115 West B for Eutelsat on March 1. The all-electric Boeing-built satellite entered service at the end of August with 96 36-MHz Transponder Equivalents (TPEs) of capacity supplied by 48 C- and Ku-band active transponders. ABS is continuing to grow its fleet with plans for several additional satellites, each carrying high-tech payloads.

“Electric propulsion and bulk ordering of satellites from Boeing allowed ABS and Satmex/Eutelsat to significantly lower the cost of transponders delivered into orbit,” said Choi. “Future advances in UTS will reduce the cost of Mbps by another 75 percent.”

Choi described ABS’s UTS satellites as impervious to rain-fade in Ku- and Ka-band thanks to the company’s patented “Rainproof” technology. He said ABS has high expectations this technology will make the operator an even more aggressive competitor.

“All of our future satellites will have some form of the UTS payload, which not only delivers the lowest cost per bit of any geostationary or non-geostationary platform, but it will also guarantee remarkable availability for the end users. ABS’s UTS will make all other Ka-band HTS platforms obsolete and irrelevant because no customer will choose Ka-band when they can have 99.9 percent reliability at the same or lower price from ABS,” said Choi.

Choi said new satellite plans continue to develop despite the setback of not having access to Ex-Im Bank. Though momentum is stirring to restore the U.S. Export Credit Agency (ECA), it still remains unable to finance new projects until reauthorized. Having access to needed financing is a guiding factor in ABS’s cadence for ordering new spacecraft.

“Based on the filings we have made and market demands, we can have more than a dozen new satellite projects. However we need to be fiscally responsible and we can only handle one to two builds at a time,” explained Choi. “Early in 2014, we were paying for ABS 2, ABS 3A and ABS 2A. That build plan was very ambitious for a company of our size. Fortunately two of those satellites have launched successfully and now ABS 2A is completed and waiting to be launched when the Falcon 9 returns to flight. We will continue to focus our energies and CAPEX on the emerging markets as our focus.”

ABS 8, a contract awarded to Boeing prior to the lapse of Ex-Im, was jeopardized once Congress let the ECA’s charter expire. Choi said it is the preference of ABS to stick with U.S. manufacturers — Boeing in particular — and that the company hopes Ex-Im will be reauthorized soon. In the meantime, he said ABS remains in discussion with Boeing and other vendors on how to proceed with ABS 8.

“Beyond ABS 8, the first UTS satellite for Asia, we are planning another satellite, ABS 9, in the Atlantic Ocean Region (AOR) at 16 degrees west, and we will develop a new satellite, ABS 10 for the Pacific Ocean Region (POR) at 159 degrees east,” added Choi. “We hope to fund those two satellites in the next 24 months. We continue to believe that the emerging markets represent the best market segments for growth. ABS is also heavily involved in launching several DTH platforms in the Middle East, Indian Subcontinent, Indonesia and, in 2016, Africa.”

ABS grew sales and Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) by more than 20 percent during 2015, which represented a slower year for the fast-growing operator. Choi said 2015 fell behind the 35 percent Compound Annual Growth Rate (CAGR) the company has experienced the last decade, but added that he expects to return to this level in the next fiscal year. Not disregarding the capacity glut looming over many regions, Choi said ABS finds the market has lots of room to continue growing, which the operator will target with new satellites.

“There is an over supply of capacity everywhere in the world today. Despite this, there is always growth in the end-user base so we have to be smarter, faster and more responsive in the way we respond to the requirements of our customers,” he said.