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[Satellite News 11-01-11] Nigerian Communication Satellite Ltd. (NigComSat) is hoping that lightning won’t strike twice as China Great Wall Industry Corp. (CGWIC) gets set to launch its NigComSat 1R satellite at the end of the year. The satellite operator suffered a huge blow in 2008 when it was forced to write-off its first satellite NigComSat 1 after it suffered an anomaly that set its plans back by a number of years. The successful launch of NigComSat 1R, now the operator’s first satellite, will enable NigComSat to put its business strategy into action after a long three years.
The NigComSat 1R satellite will have four C-band, 14 Ku-band, eight Ka-band and two L-band transponders. NigComSat Managing Director Ahmed Rufai is optimistic that the operator is up to the task of building a strong local operator in Africa. “Our vision is to be the leading satellite operator and service provider in Africa,” he told Satellite News.
Rufai, who sets out the targets for the operator on its flagship NigComSat 1R satellite, said the satellite’s pre-launch negotiations and sales are currently ongoing. “Internal services to be deployed, will utilize 50 percent of the capacity on NigComSat 1R. Demand for satellite capacity in Africa is still in excess of supply. There’s a huge market for satellite capacity, which makes the launch of NigComSat 1R timely. The major tasks of NigComSat over the next 12 months include the launch of NigComSat -1R in December 2011, deployment of services and sale of transponders among others. We expect revenue to grow at a steady rate in the next 12 months. Major new market opportunities (for the company) include broadcasting services and the CDMA network for security agencies.”
In the three years since the first NigComSat satellite failed to reach its orbit, the financial situation in Africa has changed as the global economic environment has plunged the world into a deep recession. “Our country was not totally shielded from the global economic downturn, and invariably our organization, since we are government owned. However, we are carrying on operations as best as we can,” said Rufai.
But Rufai also sees 2012 shaping up to be a key year for the operator, with exceptionally strong broadband opportunities presenting themselves for the company —advantages that perhaps did not exist in 2008. “The broadband access market is growing and will continue to grow due to the availability of more satellite over Africa for signal distribution to rural and underserved areas,” said Rufai. “There is a future for Ka-band in Africa. Ka-band will have a stronger market in Africa when prices of equipment reduce. NigComSat-1R provides three Ka-band beams, in Nigeria, Europe and South Africa respectively.”
The company also hopes the successful launch of NigComSat 1R will be a prelude to the launch of further satellites. “For NigComSat-2, we are looking at the provision of TV and audio broadcast services and communications over Africa, Middle East, China and other Asian countries. NigComSat-3 is planned to cover Africa, South and North America with capability for steerable spot beam and frequency reuse on Ka-band,” said Rufai.
Opportunities in the military market are perhaps harder to forecast, according to Rufai, but NigComSat is hopeful that there is a good market here for the company to exploit. Rufai also is open to a possible hosted payload offering in the region, and said that a hosted payload deal with a government customer would, “not be a bad idea. Massive opportunities exist for Nigcomsat to serve the communication needs of security agencies. Our satellite can be used to provide secure channels for all national and military information and communication.”
UPDATE – Sirius XM Radio recorded 334,000 subscriber additions in the 2011 third quarter — a result that fell considerably short of both Wall Street and analysts’ forecasts expecting between 355,000 and 400,000 new subscribers. The company’s quarterly revenue of $764 million, however, was inline with estimates.
In its latest financial results issued Nov. 1, the satellite radio broadcaster said it had a difficult time getting customers to commit to its service once their trial rate offerings ended. The company traditionally acquires most of its new subscribers by offering free trials of its service when people buy new cars. About 48.1 percent of Sirius XM trial subscribers became full paying subscribers in the third quarter of 2010. That rate fell to 44.4 percent in its most recent fiscal quarter.
Sirius XM CEO Mel Karmazin said the company’s recent decision to increase its service price starting Jan. 1, 2012, had nothing to do with the disappointing subscriber results. “I have not heard of any backlash from consumers since the price raise was announced. We are very cautious when we are raising our price. We believe that we are being prudent,” Karmazin said during a conference call.
Sirius XM said it would not increase its earnings outlook for the rest of the year or for 2012, when the company expects revenue to rise 10 percent to $3.3 billion and its free cash flow to rise 75 percent to $700 million.
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