Arabsat CEO Khalid Balkheyour has confirmed to Via Satellite that the company concluded a hosted payload deal on its BADR-7 satellite and will announce the customer at the SATELLITE 2013 conference next week. Balkheyour spoke with Via Satellite about how the deal, which had been a long time in the making, should give the hosted payload market a shot in the arm.

Via Satellite: Could you give us any hints as to the identity of your new hosted payload customer on BADR-7?

Balkheyour: The customer is commercial and not government. The partner is not from the Middle East, however, they carry a significant amount of its business there, and in Africa too. Any deal is difficult unless a mutual benefit is obtained. The difficulty was mainly in designing the hosted payload in a way that could allow for mutual benefits of both partners and support the whole business case of the satellite. We cannot disclose at the time being who is the partner due to commercial sensitivities, but the order to start manufacturing the satellite was given at the beginning of October and the deal will be announced during SATELLITE 2013 in Washington.

Via Satellite: Which manufacturers will be involved as partners on the project?

Balkheyour: In January, we announced that a consortium of Astrium and Thales Alenia Space would be jointly responsible for building the satellite and delivering it in orbit. Astrium will supply the Eurostar E3000 platform and integrate the satellite. Thales Alenia Space will design and build the communications payload.

Via Satellite: How significant is the announcement to both Arabsat and the hosted payload market?

Balkheyour: The deal’s significance is that it is the first commercial type of hosted payload deal signed in the Middle East. The deal strengthens our position as the first provider of Ka-band services in the Middle East and selected areas in Africa. The payload will be placed on the BADR-7 at the Arabsat hotspot at 26 degrees East to allow for a portion to support Arabsat’s video neighborhood at that location with broadband services over satellite on a two play or triple play fashion.

Via Satellite: Why does it seem that hosted payload deals have proved notoriously difficult to nail down?

Balkheyour: Overall, the difficulty comes usually on qualifying and hunting for the right partner who has certain needs to qualify for a hosted payload rather than waiting for somebody to be looking for a provider. You need more of a proactive approach. In the other hand, Arabsat is in talks with certain governmental entities for a hosted payload deal, but the problem always with governments is the stretched time lines and uncertainty of their accurate needs. Arabsat has been engaging in different exercises supporting such quests.

Via Satellite: Will this be the only hosted payload deal Arabsat will sign this year?

Balkheyour: Arabsat wouldn’t have carried the payload unless its lucrative as a standalone deal and it supports the whole business case of the satellite. The key learning is patience. Hundred iterations in commercial and technical negotiations took place. We are looking for a further hosted payload of Ka-band for government needs. We hope that it will materialize in 2013.”

Via Satellite: Do you think other governments in the Middle East willfollow Australia’s lead and go down the hosted payload route to boost capacity at reduced costs?

Balkheyour: You need to be proactive in regard. Most governments have plans but get stuck with implementation. Hosted payload deals could be the way for those governments to establish national satellite initiatives without incurring full costs of manufacturing and launching their own satellites. Not to mention establishing a business case and providing the right spectrum and associated rights.”