Satellite Executive of the Year 2007: Our Nominees Are…
Each year, Via Satellite honors the top executive performances of the past 12 months. The 2007 nominees include three CEOs who guided their respective companies to successful financial years as well as laid the groundwork for continued long-term success and the three leaders of a team that waged a successful campaign to preserve the use of C-band spectrum for the satellite industry.
Matthew Desch, CEO, Iridium Satellite
Matt Desch joined Iridium in September 2006 and under his leadership, Iridium has posted steady growth in customers and markets served. Iridium’s 2007 third quarter was the company’s best ever in terms of subscriber additions and revenues, as the satellite operator benefited from a combination of new initiatives and the struggles of one of its main competitors.
Iridium posted gains around the world. Traffic in North America surged as Iridium unveiled an aggressive new pricing plan designed to take advantage of churn from other satellite communications service providers. Usage in the United States jumped 71 percent during the summer, and Canadian traffic nearly doubled in the same period. In the Asia-Pacific region, traffic improved nearly 50 percent throughout 2007, and in Australia Iridium added thousands of customers who switched from other mobile satellite service providers.
Iridium also has seen success across its major vertical markets. Short-burst data service revenue jumped 214 percent due to growth in the machine-to-machine market, with subscriber activations increasing 317 percent over 2006. Customer additions in the aeronautical and maritime sector also showed strong gains.
Among the key contracts signed by Iridium in 2007 are deals with the U.K. Ministry of Defense, Continental Airlines, Cathay Pacific Airlines, the New Zealand Ministry of Health and the Australian Rail Track Corp. Iridium recently established relationships with Tesacom and Stratos Global Corp. in order to expand its business in South America, and in Europe, EADS subsidiary Astrium Services signed an agreement to become a value-added reseller of Iridium communication equipment and services.
Desch also is overseeing the development of Iridium’s next-generation satellite constellation, dubbed Next. The new satellites will feature an IP-based architecture to leverage broad-based technology enhancements from the industry and offer customers an enhanced array of services. Iridium has signed contracts with six partners for the design and development phase of the new network.
Amiram Levinberg, Chairman & CEO, Gilat Satellite Networks
Amiram Levinberg was one of the founders of Gilat Satellite Networks in 1987 and served in various senior management roles for 16 years before leaving the company. But he returned as chairman and CEO in 2005 and led Gilat to one of its most successful years in 2007.
Prior to Levinberg’s return, Gilat had suffered through financial and market-performance challenges, but in the 2007 second quarter, the company recorded revenues of $70.3 million, its highest in five years. Under his leadership, Gilat has enjoyed eight consecutive quarters of revenue and income growth through September 2007 and also consolidated its U.S. operations, expanded its global presence and market share, opened a new complimentary wireless business unit and launched its latest generation VSAT platform.
During 2007, major VSAT networks deployed by Gilat included a 6,500-site network for Russia’s Ministry of Education to bring Internet connectivity to Russian schools, networks for Sibirtelecom and North-West Telecom to bring telephony and broadband Internet services to remote regions in Siberia and Russia’s northwestern region, and a network for Russia’s largest electric utility, FSK, to power data acquisition and telephony applications at 650 sites.
Gilat also supplied a turnkey solution to support Nigeria’s elections, which included the deployment of a broadband satellite network comprising more than 1,000 solar-paneled VSATs as well as managed hub services. Australia’s Optus continued its deployment of a SkyEdge VSAT network to serve thousands more sites under the Australian government’s broadband programs, and Gilat’s Spacenet subsidiary teamed with Verizon Business to deliver a broadband satellite network to 5,000 U.S. Postal Service locations to support on-demand, back-up communications as well as portable communications for the U.S. Postal Inspection Service fleet.
Levinberg also oversaw the accelerated development of the SkyEdge 2 VSAT platform, which is based on DVB-S2 and DVB-RCS to provide higher efficiencies and full adaptivity for both the inbound and outbound channels.
David Hershberg, CEO, Globecomm Systems Inc.
Under the leadership of CEO David Hershberg, Globecomm Systems reported record revenue of $150.7 million in its most recent fiscal year, a 20 percent gain over the prior year. During the year, Globecomm also entered the mobile solutions market with SatCell, a service providing IP-based mobile backhaul and hosted switching for low-density rural markets.
Hershberg drove Globecomm’s May acquisition of the GlobalSat division of Lyman Brothers, which deepened Globecomm’s penetration into the U.S. government market. In October, Globecomm was named a tier-one subcontractor on the U.S. Department of State’s Hybrid Information Technology Services for State program, which aims to provide management of the department’s information resources around the globe. The company also was awarded a contract from the U.S. National Oceanic Atmospheric Administration’s National Weather Service for the Weather Radio Improvement Program to design, develop and build a network prototype that will use voice and text notification via satellite and terrestrial broadcast equipment of weather forecasts as well as watches, warnings and advisories for hazardous weather.
Globecomm also moved into the top ranks of content management companies, opening a state-of-the-art program origination center for Showtime Networks at Globecomm’s Long Island International Teleport. In addition to design, engineering and construction, Globecomm provides facility management, network monitoring and uplinking services to satellites serving the United States.
In May, Globecomm captured a contract to provide mobile phone service to 200 villages throughout Alaska via a mesh IP satellite network, the second award for the SatCell IP-based mobile backhaul and hosted switching solution.
In October, Globecomm and NeuLion announced they would begin providing program acquisition and contribution feeds of National Hockey League games for live streaming from the NHL TV Web site, Globecomm’s first service contract for the delivery of TV content via the Internet.
Kengi Chen, director spectrum management and operations planning, Inmarsat
Kalpak Gude, vice president regulatory affairs,
John Lothian, vice president of space development,
The satellite industry scored a resounding victory at the World Radiocommunication Conference 2007 (WRC-07), as the meeting closed with delegates rejecting requests from terrestrial players to obtain more access to C-band spectrum.
Many satellite industry executives around the globe put in long hours throughout the past few years to ensure a positive outcome for the industry, and three of those — Kengi Chen, director spectrum management and operations planning for Inmarsat; Kalpak Gude, vice president of regulatory affairs for Intelsat and John Lothian, vice president of space development at SES Global — were instrumental in spearheading the No Change campaign that led to the satellite industry’s win.
WiMax and international mobile telecommunications (IMT) players had been seeking access to part of the spectrum, traditionally the domain of satellite players, but the No Change campaign gained momentum throughout 2007, driven by both national policy imperatives and the satellite industry. Not only did the WRC-07 decision reject those requests, it also ensures that future IMT networks will not interfere with satellite’s use of C-band.
“This outcome shows overwhelming recognition of the need for continued interference-free operation of C-band satellite services that are essential for the provision of national over-the-air and cable television services, emergency and disaster recovery communications, Internet services, and mobile and wireline telephony trunking services,” says Lothian. “… We insisted on very strong protection for existing and future satellite operations. Under the regulations, Earth stations are protected in the country as well as in the neighboring countries.”
While the terrestrial interests seeking more access to C-band spectrum generally were regarded as well organized and better funded than the satellite industry, the No Change team organized efforts to inform delegates of the potential harmful impact that terrestrial services would have on satellite-provided services and rallied satellite advocates from many parts of the world. The ability to fully explain concerns such as the documented impact that IMT-created interference would have on satellite services, the importance of C-band satellite services in areas that experience rain fade and the importance that satellite C-band communications play in regions affected by natural disasters were key in convincing delegates not to change the C-band allocation.
The No Change team, which also benefited from the efforts of regional operators network integrators and industry lobbying groups, rallied their constituencies, and as the four week conference got underway, the number of countries lobbying for an IMT identification in the band began to shrink. A number of countries which originally submitted documents in favor of identifying the C-band for IMT changed their positions due to the satellite industry’s efforts.
The intensive, long-term effort of the No Change team preserved the valuable bandwidth for satellite players and also laid out the groundwork for industry leaders to follow in similar situations on the future.
The Ones to Watch
The 2007 Satellite Executive of the Year nominees set themselves apart from the competition with their performances. Many other industry executives also had major accomplishments during the year, but the full measure of success of those deeds may not be realized until 2008 or beyond. These are the companies and executives that bear watching throughout the year, and the direct competition that many will engage in will make it even more interesting.
The giants of the fixed satellite services (FSS) sector — Intelsat CEO David McGlade and SES Global CEO Romain Bausch — again will be in the public eye, both because they lead the dominant satellite operators in the world and because their customers and competitors will scrutinize their every moves. For example, SES launched its U.S. IPTV initiative, IP Prime, and subsidiary SES Astra launched its satellite broadband service, Astra2Connect, in Europe. The performance of these two new initiatives will be key performance barometers for the company in 2008. The next two largest FSS players also enter 2008 with high expectations. Eutelsat, lead by CEO Giuliano Berretta, rolled out its consumer broadband service, Tooway, across Europe and also announced plans to add a dedicated Ka-band satellite to its fleet in order to offer a compelling proposition to customers who are unable to access terrestrial broadband. Following the completion of Loral Space and Communications’ acquisition of Telesat in October, CEO Daniel Goldberg will guide the new Telesat, now fourth-largest FSS operator, through its first year of operations.
Also on the satellite broadband front, the competition between WildBlue Communications Inc. and Hughes Network Systems will become even more intense in 2008, even though demand for their respective services offers plenty of business for both companies. WildBlue began operations with its WildBlue-1 satellite in 2007, and subscribers to the satellite broadband service jumped 150 percent to 250,000. WildBlue CEO Dave Leonard also extended wholesale operating agreements with AT&T, Echostar, DirecTV and NRTC, and WildBlue Enterprise Solutions expanded its presence, signing agreements with UDCast, Xiplink, Trispen, Orbital Data Net and Broadcast International. Pradman Kaul, CEO of Hughes, finally will get to market the company’s Spaceway 3 satellite and its 68 Ka-band transponders, which is expected to become operational before the end of the first quarter. Hughes also made noise in early January, agreeing to acquire business IPTV solutions provider Helius Inc.
The launch industry also has the potential to provide plenty of 2008 candidates. Frank McKenna, president of International Launch Services (ILS) led a strong performance in the launch provider’s first year as an independent company marketing the Proton Breeze M vehicle, as the company recorded $1.5 billion in orders in 2007. Sea Launch and President and General Manager Robert Peckham also will be watched closely in 2008, as satellite operators look to see how well the company recovers from the January 2007 launch failure that cost Sea Launch a year of missions and some of its customers valuable time in orbit.
The two commercial satellite imagery competitors will step up their efforts in 2008 to develop the commercial imagery market using the latest-generation spacecraft. DigitalGlobe and President and CEO Jill Smith have opened up the company’s WorldView-1 satellite for commercial business. The spacecraft, together with the company’s QuickBird satellite will be able to collect up to 900,000 square kilometers per day of half-meter imagery. Rival GeoEye and CEO Matthew O’Connell are expected to place the company’s own second-generation imagery satellite, GeoEye-1, in orbit early in 2008.
Eric Beranger, CEO of Astrium Services, guided the company through an impressive 2007, overseeing acquisitions that expanded the company’s offerings and size, but the key to 2008 and beyond will be the new Skynet 5 military satellites placed into orbit in 2007. The spacecraft will provide communications services to the U.K. Ministry of Defense, NATO and other military customers through its Paradigm Secure Communications subsidiary under a new contract approach for Europe. If this outsourcing approaching proves successful, it could have a huge impact on the future of military communications.
A new company with a chance to make an impact in 2008 is ProtoStar, led by President and CEO Philip Father. The company’s ProtoStar-1 satellite is scheduled to be placed into orbit early this year. The business model calls for capacity on the satellite to be leased to third parties to provide digital direct-to-home services, high-definition TV and broadband Internet to underserved areas in Asia. ProtoStar already has signed agreements with companies such as Antrix, the commercial arm of the Indian Space Research Organization, and PlanetSky Ltd. Also in Asia, it may be worth keeping an eye on Shin Satellite and Chairman Dumrong Kasemset and whether the company can make its ambitious IPStar satellite broadband service a success all across Asia.
Sirius Satellite Radio CEO Mel Karmazin also remains a potential candidate for the same reason everyone watched him in 2007 — can he engineer the merger of Sirius and rival XM Satellite Radio? Karmazin’s plans remain on hold as various parts of the U.S. government continues to debate whether to approve the deal. If Karmazin can win that argument -— based on the contention that Sirius and XM are not competing against each other as much as competing against a broad variety of music providers — attention then turns to whether Karmazin can then lead the combined entity to success in the face of such competition.