VIA SATELLITE: Why did you choose SpaceX as your launch service provider?
Northland: In our view, SpaceX will be a viable launch vehicle for commercial satellites. The company has great leadership, and we are confident that they will develop a reliable launch alternative for the industry. The U.S. government has funded the company to demonstrate launch services supporting the space station and other military applications. They already have launch contracts with prestigious organizations such as NASA, Iridium, SES, Thaicom and AsiaSat. We like the fact that the Falcon 9 launch vehicle uses a two-stage vehicle regardless of whether the mission is for LEO or for GTO launches. There is no additional hardware risk for GTO missions associated with an additional upper stage, and the reliability record established by SpaceX for every launch is directly applicable to our Satmex 7 launch regardless of the mission flown.
SpaceX currently has a manifest of more than 15 launches, at least five of which will be GTO missions, that are scheduled to be executed prior to our Satmex 7 launch. We are confident that SpaceX will have established an impressive reliability record prior to our scheduled launch date.
VIA SATELLITE: What are your capital expenditure plans beyond Satmex 7?
Northland: Our next satellite is Satmex 8, which we are planning to launch later this year. Satmex 7, which is using the 702SP platform, is currently scheduled to launch in early 2015. We then have an immediate option six months later to deploy our second Boeing satellite. If we take that option, it will be commercially available six months after Satmex 7.
VIA SATELLITE: What do you see as the next big growth opportunities for the company outside of Mexico?
Northland: We derive around 30 percent of our revenues from Mexico. The majority of our revenue is coming from South America and the United States. We are also looking to explore opportunities in the Canadian market. The significant growth is coming from DTH, cellular backhaul and broadband services. There are some new DTH platforms emerging, but growth is also strong from existing platforms. We are also beginning to see potential growth opportunities on our cable neighborhood capacity. DTH and cable operators want to move into HD programming, which requires additional capacity. I would say that all of the existing video networks will require significant amounts of additional capacity. Satmex is well positioned to provide capacity to those video networks looking to grow. We can reach all of the Spanish speaking countries in South America, like Chile, Peru, Colombia, Ecuador and Venezuela, etc. That is one very specific growth opportunity for us. The second area of growth for us is cellular backhaul. We continue to see a tremendous amount of growth on cellular telephony networks. All of the trunking of those cellular networks are connected by satellite in many countries like Peru. It is very hard to justify the costs of using connectivity technologies other than satellite for cellular operators in countries with difficult geographic characteristics.
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