by Theresa Foley

The higher-performance, more cost-effective expendable launch vehicles that satellite owners have desired for many years are joining the ranks of demonstrated flying machines as the new millennium opens. While the development of the larger launchers–Ariane 5, Sea Launch and the new Proton, Atlas and Delta versions–has taken many years and hundreds of millions of dollars, the vehicles are making the difficult transition into commercial flight readiness.

The Ariane 5 record is one successful flight of the post-qualification vehicle, and three successes and one failure for the qualification series of launches. Sea Launch also was on the road to routine, reliable operations with two missions accomplished by the start of the year, although the impact of a late-breaking launch failure in March has yet to be determined. The pace of launches for both were to pick up this year, with Ariane 5 scheduled to fly five or six times and Sea Launch as many as five in 2000. Meanwhile, the two new launchers being designed under the U.S. Air Force’s Evolved Expendable Launch Vehicle (EELV) program, the Atlas 5 and Delta 4, are getting closer to their first flights in 2001-2002. Both have commercial variants that are expected to be priced lower than existing rockets, increasing the competitive pressure of operators of the older rocket designs.

But export licensing difficulties and flat demand continue to hamper the commercial launch services industry. The need for launches into geostationary orbit runs at about 25 to 30 a year, and is not expected to grow, according to projections made by the Commercial Space Transportation Advisory Committee to the U.S. Department of Transportation. But the five big commercial launch operators, Arianespace, Boeing, Sea Launch, International Launch Services and China Great Wall, have among them a theoretical capability to launch about twice that number.

The oversupply problem, however, may be more illusory than real today. The world’s rocket fleet each year suffers stand downs, where a particular rocket is grounded for many months running, due to failures and other problems. In 1999, the Delta 3 and Atlas launchers had to suspend their schedules for much of the year while a lengthy investigation looked into the cause of two Delta 3 failures in a row. The Delta 3 is Boeing’s latest launcher, and since it is sized much larger than the older Delta 2, proving its reliability is essential for the Delta line to stay in competition for commercial launches. Atlas became an innocent victim, since it had not failed but only used common systems with the Delta 3. The Russian Proton also had two consecutive, similar failures in 1999, putting that workhorse launcher into a holding pattern that lasted more than four months.

Another factor impacting launch schedules is delays by satellite manufacturers and operators. “What continues to happen is that all that advertised capacity isn’t available. Demand is heavily influenced by the reality of scheduling difficulties,” says Doug Heydon, president of Arianespace’s U.S. office. When a company says it can launch 12 to 14 times a year, the claim is meaningless if the customers do not show up according to the schedule in the contract, he adds. “Those lost two to four launches per year have the same effect as if you never provided the capacity.”

Heydon says the pressure to shorten manufacturing schedules while building increasingly complex satellites is behind the increase in in-orbit satellite failures in the last two years. Simple spinning satellites used to be built in 18 to 24 months, but now are produced in 12 to 14, while bigger satellites are promised in 18 to 24 months. “That they don’t meet delivery schedules is not surprising,” Heydon says.

As the launch schedules were suspended, satellite customers had to scramble to find any available means to get their satellites, which had customers waiting to use them, into space. Arianespace ended up as the main beneficiary of the last minute launcher changes, adding three missions to its launch plan on very short notice last year. Ariane delivered three satellites, Telstar 7, GE 4 and Orion 2 (now called Skynet 12), on short notice in 1999 when the original launch vendors were unable to meet the operator’s schedule, Heydon says.

Arianespace typically flies a fully loaded schedule every year, and was able to offer the short-term launches only because many of the satellites that it had planned to launch in 1999 were delivered many months late because manufacturing took longer than planned.

In fact, a lack of payloads from April to August kept Ariane suspended for much of the year. Arianespace conducted eight launches in the last four months of 1999, a tightly compressed schedule that complicated both operations and financial results for the company. Even worse than the management hassles of shuffling the schedule in real time were the depressed revenue levels that Arianespace reported at year end, which Chairman Jean Marie Luton attributes to the reduction in total missions in 1999 from 12 to 10.

Ariane

With a 41-satellite launch backlog, valued at $3.1 billion, Europe’s Arianespace is the world’s largest and most successful commercial launch operator. Its reliability record- -53 consecutive successes for the Ariane 4 by early 2000–is enviable and the company’s reputation is sterling. Arianespace, the French-based operator of the Ariane 4 and 5 rockets, had about $1 billion in revenue in 1999 from its 10 launches. Luton says that industry-wide, operators placed only 15 orders for geostationary launches in 1999, a particularly soft year. Of those, Ariane won 12. Luton predicts that 2000 will end up a much better year for contracts with 25 awarded and Ariane expecting to win 15 of those, commanding well over half the market.

To hold onto the top position when its competitors bring their own improved launchers into the market, Arianespace must get its costs and prices down. To that end, it struck deals in 1999 with its suppliers to price the second batch of Ariane 5 rockets 35 percent lower than what Ariane paid for the first lot, $1.7 billion dollars for 14 launchers. Luton says the new supply contracts will allow Arianespace to remain competitive even if launch prices fall in general. As it stands, Arianespace is often the highest priced bid during a competition, but has been able to win anyway because of the high value customers place on reliability, schedule and performance, Heydon says.

This year, Ariane will add more Ariane 5s to the mix of launches, using the larger launcher for five or six missions, each carrying two satellites, and using the smaller Ariane 4, which often carries a single satellite payload, eight to nine times. As Ariane 5 is phased in, Arianespace must pair satellites owned by two customers onto a single mission, which allows lower prices by virtue of spreading fixed costs over two customers. The management of paired satellites becomes even more complex when satellites are delayed and the matchups have to be shifted close to launch. Despite that added complexity of Ariane 5, Heydon says the dual satellite approach is a major benefit to customers.

Pricing of launchers varies from mission to mission, with the ballpark range for a typical geostationary satellite launch costing $80-$100 million. Heydon says in general, the Atlas, Delta and Ariane tend to be in the same competitive bidding range, but that the non-market economy launchers, which are the Russian Proton and Chinese Long March, usually come in at the lowest price.

“We strive to be close enough, within a few percentage points of the competitors, that the perceived advantages, plus our reflight guarantee, which offsets some insurance costs, will influence a customer to spend more than they would for a Sea Launch or a Delta. But the problem will become more difficult as the EELV fleet comes into operation. They will be less costly per unit of performance than the present Atlas and Delta families. It’s a challenge to us to remain cost competitive,” Heydon says.

As Ariane 5 prices come down, the lift capability should go up due to improvements planned for introduction in the next two to five years. Ariane 4 is capable of taking a 4,900 kg satellite to geostationary transfer orbit, while the Ariane 5 will get to 6,500 kg by 2002 or 2003, and to 12,000 kg in 2003-2004. To get to 6,000 kg, a new high-energy upper stage that uses cryogenic propellant rather than the current storable propellants will be developed for some missions starting around 2001. A huge increase to a 12,000 kg payload lift capability requires Arianespace to develop an entirely new upper stage, which will not be available until 2003-2004.

ILS

International Launch Services (ILS), the operator of commercial Proton and Atlas services, has an extremely busy year ahead with six to nine Proton missions planned and nine to 13 Atlas missions. But the real highlight of the year for ILS will be the introduction of the AC201, the first launcher in a new Atlas series, and the first Proton Breeze M version. The new Atlas 3A, which should fly in April with Eutelsat’s W4 satellite on board, is powered by RD180 engines of a Russian design that have been manufactured in the United States under a partnership with engine-maker Pratt and Whitney. “With the RD180, we can get a larger payload into geostationary transfer orbit,” says ILS President Mark Albrecht. “It’s the most reliable engine in the world, and the new vehicle will marry two systems with a heritage of reliability to create a launcher with more performance and higher reliability.”

The first Proton with a new Breeze M upper stage is scheduled for an early fall launch carrying a Eutelsat spacecraft. The current Proton, known as a Block DM version, can lift 4,350 kg to 5,000 kg to GTO, while the Breeze M will be able to launch 5,500 kg to 6,200 kg to GTO. Proton has launched more than 260 times. At year-end 1999, ILS had completed 10 launches, with five each on Proton and Atlas, with no failures. The two failed Protons were missions conducted by Russia without ILS involvement.

The two Proton failures in 1999 were traced to poor quality and workmanship problems by a Russian investigation board that reported its findings in January. Albrecht says those problems were limited to hardware made in a specific period of time, 1992-93, and do not affect all the hardware in the Proton program. “We understand the failures and the cause. We have high confidence that these are never to be repeated,” he says.

The Proton failures hurt ILS’s ability to win new contracts in 1999 (ILS’s statistics do not track those of Arianespace exactly) but Albrecht says that he expects customer confidence in the vehicle to be quickly regained. Despite the Proton and Atlas stand-downs, ILS received about 11 new orders in 1999, and calculates that it has a “win rate” of about 40 percent of the market. ILS is moving away from the practice of signing deals for block buys of launchers, which Albrecht says is a technique needed for new and untested launchers. “As you live with the consequences downstream of signing the large buys, it becomes difficult to manage the business and meet all the obligations,” he says.

Another change this year will be the relocation of ILS headquarters from San Diego to Washington, DC. Albrecht says that the high level of regulation of the launch business and the desire to be in a convenient location for customers prompted the move. “The quality of service is contingent upon having a close working relationship with the government,” he says.

ILS for years has been subject to a restricted quota in the number of Protons that could be used commercially under an agreement between the United States and Russia. The agreement, which permitted no more than 25 launches on Proton, expires at year-end 2000. Albrecht believes it is possible that no new agreement will be struck, leaving ILS and the Russians free to sell as many Protons as they can to owners of U.S.-built satellites. Albrecht says ILS can carry out all the Proton missions needed this year without violating the number restriction.

Boeing Delta

Boeing spent the latter half of 1999 in recovery mode after its new launcher, the Delta 3, failed during its second launch in August, making it two losses for two attempts. The company then began an in-depth investigation of the cause of the failure, which was only wrapping up in March when Via Satellite went to press. The conclusion was that the failures were due to a ruptured seam in the combustion chamber of the second stage engine, built by Pratt and Whitney (P&W) in West Palm Beach, FL. Walter Rice, Boeing spokesman, says that P&W changed the process for making the chamber, to eliminate air pockets that had been created along the seams during welding of the metal parts. Boeing also has changed the inspection process of the seams, using ultrasound now to check the integrity, which is considered more reliable than the X-ray inspection method that had been used before.

Boeing hoped to have the Delta 3 back in service in the spring. Even if launches resume by mid-year, a degree of uncertainty exists about the number of Delta 3s that will fly in 2000 since a large customer for the rocket, ICO Global Communications, was likely to delay most of its launch schedule. ICO is expected to modify its satellites to serve the restructured ICO that will emerge this spring from that company’s bankruptcy proceedings. ICO had booked five missions on Delta 3 this year.

Despite the rough start for the Delta 3 vehicle, Boeing ended 1999 on a high note with the win of the launch contract for half of Skybridge’s 80 broadband satellites. Boeing will invest in Skybridge with an unspecified amount of money. The 40 satellites will be launched using two Delta 3s and four Delta 4s.

Including the two Skybridge missions, Delta 3 has a backlog of 18 missions. The other orders come from Hughes, with 11, and Space Systems/Loral, with five. Delta 3 is capable of lifting 3,800 kg to GTO, twice the payload of the Delta 2.

In April 2001, Boeing hopes to launch the first Delta 4, a launch vehicle being developed to meet U.S. Air Force requirements for more cost effective launch services. Delta 4 will be far more capable than the earlier Deltas, with its 13,200 kg capability to GTO. Because of backing from the military, Delta 4 has an even larger backlog than Delta 3. The Air Force has committed to 19 Delta 4 launches under a $1.4 billion launch service contract. With the four missions for Skybridge, Delta 4 has 23 launches planned once it begins operating.

Boeing continues to operate the older, smaller Delta 2, with 11 launches scheduled this year. But commercial users are in the minority for this system. Only two missions are commercial and the remainder are for the military or NASA.

Sea Launch

Sea Launch, the international launch company that uses a shipboard platform in the Pacific to launch large satellites into geostationary orbit, had taken a big step towards establishing itself as a reliable service provider by carrying off two successful launches in 1999, giving it a track record of two consecutive successes, until the launch failure of the ICO F1 satellite in March. As of presstime the impact of the failure, as well as its cause, were still being assessed. The launch of a DirecTV satellite aboard Sea Launch on October 9, 1999, following the inaugural flight on March 27, 1999, with a dummy payload, helped the rocket’s reputation.

In February, at the Satellite 2000 conference sponsored by Via Satellite, Sea Launch announced its first 1999 contract, a deal for one firm launch and four options for Panamsat Corp. Panamsat’s Galaxy 3C satellite will fly in second quarter 2001 under the contract.

Prior to the failure, Sea Launch had planned four or five launches this year. In 2001, Sea Launch could launch up to eight times if it wins a sufficient number of customer orders. Later, Sea Launch could boost its launch rate to 12 to 15 launches per year, joining Arianespace and ILS in attaining such a high regular launch rate.

Sea Launch is owned by a multinational group that includes Boeing Commercial Space Co. with 40 percent, RSC Energia of Russia with 25 percent, Kvaener Maritime of Norway with 20 percent and KB Yruhznoye/PO Yushmash of the Ukraine with 15 percent. Kvaerner announced last year that it wanted to sell its stake but still has not found a buyer.

Sea Launch may still have to wait a few years for satellite owners to begin ordering a high number of large satellites requiring its capabilities. Sea Launch is able to take a 5,000 kg payload to GTO; the launch mass of the DirecTV 1R satellite was 3,400 kg. Only about eight of the 30 annual satellite launch missions fall into the Sea Launch performance category, and that limits the number of competitions that require a Sea Launch-class of vehicle. Of those eight, Amy Buhrig, Sea Launch’s vice president of marketing and sales, hopes to win about half.

Boeing’s purchase of the satellite manufacturing business of Hughes, announced in January, may give Sea Launch a strategic advantage in winning the launch orders for those satellites, but Buhrig says that for now, the two units will operate as independent entities.

Boeing and Sea Launch are working to streamline their export approval processes and are incorporating an added time lag to mission planning for the process. Buhrig says the problem is particularly acute when a new business opportunity is identified, and Sea Launch has to wait for permission to share information with the new customer.

China Great Wall

With all the political turmoil in the U.S. surrounding China, the China Great Wall Industry Corp.’s presence in the commercial launch services market has cooled considerably from several years ago. Great Wall, which flies seven versions of the Long March rocket, entered the commercial market around 1985 and has flown 16 commercial communications satellite missions and five “piggyback” smaller commercial payloads. The payload range of the Long March is 2,500 kg to 4,500 kg.

China Great Wall officials were not available to be interviewed for this story, but limited information on their fleet of launchers is on the company Web site at space.cgwic.com.

Theresa Foley is Via Satellite’s senior contributing editor.

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