SkyDSL Saved From Closure

[Satellite News – 1-8-08] Investment firm Mountain Super Angel is confident that it can turn around the SkyDSL satellite broadband business, which the current owner, Teles, considered shutting down.
    Mountain Super Angel AG signed an agreement with Teles AG Jan. 3 to potentially acquire 80 percent of Berlin-based Teles Wireless Broadband Internet GmbH, which operates the European broadband Internet service.
    Mountain Super Angel has until Jan. 28 to take up the option of acquiring Teles, and Daniel Wenzel, member of the board of directors of Mountain Super Angel said he is confident the deal will take place, as the investment firm see opportunities for satellite broadband in Eastern Europe and the Middle East.
    “Germany is an interesting market for satellite broadband but with more terrestrial DSL-infrastructure the window of opportunity is smaller,” Wenzel said. “The interesting markets are Eastern Europe and the Middle East. SkyDSL is operating with Eutelsat. … We are strongly supported by Middle East investors. Therefore we are also looking at these markets.”
    Mountain Super Angel already has an investment in the WiMax arena with Mvox and believes having a satellite broadband component will be strong complement, Wenzel said. “Mvox, strategy wise, is doing the same thing as SkyDSL,” he said. “We are connecting rural areas which are not connected by Deutsche Telekom or other terrestrial broadband providers. We are connecting them using WiMax technology.”
    Mountain Super Angel also believes it can offer more focus to the SkyDSL business than Teles has. “I think several companies, maybe even SkyDSL in former times, have always started in the market by approaching a complete market without considering their product a niche product,” he said. “From our side, we want to do things slightly differently. Our market is small. We are going after a small niche market. We say with Mvox, 5 percent of the DSL market can be our target market.”
    If the deal goes ahead, improving the cost structure of SkyDSL will be a key early target. “We need to optimize the cost structure for SkyDSL,” Wenzel said. “That will be one of the first priorities. It is our aim to invest in marketing. The customer base had not been able to cover the fixed costs of the satellite service.”
    Wenzel believes there will be a strong demand for the service, despite the price point for satellite broadband. “I am not so worried about the costs of the service, because in the areas where we will cover with the service, the willingness to pay of these customers is comparatively high,” he said.