This is my final day in Paris, as later today I will head up to Amsterdam for the chaos that is IBC.
World Satellite Business Week has been an interesting event. As I have mentioned, the cost of launch services was really THE talking point of the conference. The satellite industry also gives the impression that is almost immune from the global credit crunch, and that there are a number of new growth opportunities for all of the main operators. Time will tell whether this all proves correct.
The day also featured the MSS panel, which mainly highlighted what we already knew — the keys to success are finding services that generate mass market consumer acceptance, and that for some of the operators, gaining access to funding will be a huge challenge over the next year. The panel also seemed a little light, as there were no representatives from Iridium or Inmarsat. Certainly, Iridium CEO Matt Desch and Inmarsat CEO Andy Sukawaty are not shy in giving their opinions on their respective companies and the competition. I missed that.
Today, the weather is lovely in Paris. However, today’s fare at World Satellite Business Week lacked the energy shown yesterday after the issue of the costs of launch services seemed to have hit a raw nerve. After various
FSS CEOs blasted the costs of launch services, it was one of the main undercurrents today with many joining the current trend of bashing what it costs to launch a satellite.
Regional operators such as Measat mentioned the price of launch services. Satellite manufacturers, who were also not necessarily immune from criticism yesterday, also pointed it out. It seems as though the costs of launch services has become THE theme of this particular show and the comments yesterday have definitely impacted the panels today.
Everyone wanted to talk about it. Both Paul Brown Kenyon, COO of Measat and Gustavo Silbert, president of Star One both mentioned that launch costs have increased significantly and that this could impact growth plans for smaller operators.
Overall, today lacked some of yesterday’s fireworks.
I did, however, land a great interview with Dan Goldberg, Telesat’s CEO in the Jardin des Tuileries (a lovely public garden in the heart of Paris), sat in the shade, enjoying downtown Paris, talking about FSS growth strategies. Whoever said an editor’s life was tough? So, credit to Dan for choosing such a great spot to do an interview. It certainly makes a pleasant change. See you tomorrow.
Boy, who would be a launch services provider right now? At World Satellite Business Week in Paris, CEOs of most of the top operators took pot shots at the costs to launch satellites. Complaints about launch services costs was one of the highlights of the main “Global Satellite Operators in a Changing World Panel.” One senior executive said afterward that he would love it if launch service providers had the same margins as some of the FSS operators.
Best presentation of the day: Tracy Mehr, managing director of Credit Suisse, who gave an in-depth account of the trials and tribulations of ProtoStar’s efforts to obtain funding. The stories of Candidate Father’s (ProtoStar CEO Philip Father) campaign trying to gain capital and the comparison to the U.S. presidential election and Obama and McCain campaign to gain votes was fantastic. Mehr’s presentation was a rare breed — fun to listen too but also highly informative and well thought out. Underneath the humor, what came out of that presentation was how difficult it is to gain financing. While ProtoStar potentially has a great growth story, access to funding proved much more difficult than Father imagined.
Wallets are tightening, and while the message may have been the satellite industry is in good shape (there, I said it again) to survive any credit crunch, gaining access to crucial funding seems to have got just a whole lot harder.
We kick off what it is undoubtedly going to be an exciting week with an interview with Eutelsat CEO Giuliano Berretta in which he discusses state of the industry as well as tackles some of the key issues of the day such as recent criticism of Eutelsat’s conduct in China and claims that it suppressed a TV channel for political reasons.
And now on World Satellite Business Week and IBC. I am really looking forward to these events. I think World Satellite Business Week will be an interesting event. By and large, despite the overall credit crunch, most believe that the satellite industry is in good shape. (Although the satellite industry always appears in good shape.)
I think what might be interesting here is the talk of new business areas such as mobile TV and to a lesser extent satellite broadband. But what will be the opportunities in these new areas? After MBC’s stunning demise in the mobile TV arena in Japan, I wonder what satellite executives will think of the role the industry can play in this exciting market, but one with its fair share of pitfalls.
In all honesty, it has been a fairly quiet year so far in the satellite industry. There haven’t really been any deals that have changed the face of the landscape, although Harbinger’s pursuit of Inmarsat has been mildly entertaining. Equally, Khrunichev’s deal for ILS perhaps deserves an honorable mention. But, it seems to be a year where it is about doing those old fashioned things of building the business organically. Still, there should be some interesting debates this week. I imagine access to space and the costs involved will be a key issue. The industry has seen its fair share of launch failures throughout the last few years, and with more and more demand for satellites, you don’t have to be a rocket scientist to realize there are limited options available at the moment for satellite operators who want to gain access to space.