By Cynthia Boeke

Despite the early hour–it is a little after 5:00 a.m.–I am wide-awake, searching the desert for traces of its illustrious history. It is from this seemingly endless expanse of desolate landscape in Kazakhstan that the world’s first satellite, Sputnik 1, was launched. This seminal event nearly 44 years ago set off the biggest space race in the history of mankind that resulted not only in the high-profile U.S. lunar landings, but the lesser-known creation of a global satellite network under the auspices of Intelsat. Today, the Earth is ringed with some 240 commercial communications spacecraft, and satellites provide a crucial link in the global telecommunications infrastructure.

The Baikonur Cosmodrome has not continued on its upward trajectory, however, having suffered from severe funding cuts when the Soviet Union dissolved. Indeed, a recent article in The Moscow Times (May 14, 2001, page 15) details the crumbling infrastructure, social problems affecting the local population, and decline in launch activities. But our group is excited just to be here, as we ride the early-morning bus through the sands and tumbleweed, interspersed with small yellow flowers and Queen Anne’s Lace.

We are en route to witness a Russian Proton rocket boost Panamsat’s PAS 10 Indian Ocean region satellite into orbit. The group is composed of Panamsat executives, including the company’s President and CEO, Douglas Kahn; Boeing executives, who have participated in the building of the satellite; International Launch Services (ILS) representatives, such as Chief Engineer Eric Laursen and Executive Vice President Leonard Dest, who are responsible for the launch under a U.S./Russian joint venture; and a group of PAS 10 customers, mainly from South African telecom and broadcasting companies.

I am the only journalist. Panamsat has sponsored my trip so I can learn more about PAS 10’s capabilities and customers. By the time the trip is over I have learned much more. I have become keenly aware of Panamsat’s corporate culture, which places a premium, literally, on reliability through in-orbit redundancy. I have also come to realize how important the ILS joint venture is, not only for launching a growing number of commercial communications satellites, but breathing life–in the form of hard currency–into the Baikonur Cosmodrome.

The Cosmodrome is 46 years old, having been founded by Soviet military forces on June 2, 1955. The people who built it, explains Valery Panasenkov, our guide and an ILS representative in Russia, lived in holes and tents until rail cars and normal houses could be provided to bring in supplies and screen them from the harsh extremes of heat and cold. Two years later, on October 4, 1957, Sputnik 1 was launched, and Baikonur quickly became synonymous with the success of the Soviet space program. Panasenkov, who has been affiliated with the Soviet and Russian space programs for 26 years, provides us with an endless array of details that would have been unthinkable a decade ago. I find myself wanting to learn more about this enigmatic place, especially its development in the 1970 and ’80s, which turned out to be the heyday of the Cosmodrome, as well as the surrounding city of Leninsk. Then, Leninsk was a bustling epicenter of space education, and had an impressive array of cultural institutions and activities for a city of 150,000 people located in the middle of nowhere.

The region’s fortune, however, was inextricably linked with the political developments that were unfolding in the then-Soviet Union. And, in 1991, the fate of both the Cosmodrome and Leninsk took a dramatic turn for the worse. The Kazakh Soviet republic broke away from the former Soviet Union and formed the independent nation of Kazakhstan. As a result, the Cosmodrome was no longer in the hands of the Russians. According to Panasenkov, 1992-93 was an era of destruction, when roving newcomers from Kazakhstan plundered the city and allowed it to deteriorate. Relations between the Kazakhs and Russians became tense over disputes regarding Russia’s payments to lease the Cosmodrome, at one time threatening to bring launch activities to a complete standstill. By the mid-’90s, financial issues had been largely resolved, and now the Russian government pays the Kazakhs some $115 million annually. Even so, the Cosmodrome has not returned to its previous pinnacle of activity, as the Russian military and civilian space programs dwindled to a shadow of their former selves due to lack of funding. Many of Leninsk’s citizens left. Today, only some 50,000 people live there.

In the face of such disintegration, the ILS joint venture stands out as a beacon of light for the Cosmodrome. In 1993, Lockheed Corp., the U.S. aerospace giant, formed a joint venture with the Khrunichev State Research and Production Space Center and RSC Energia to market Russia’s workhorse rocket, the Proton. When Lockheed merged with Martin Marietta, a new venture, International Launch Services, was formed in 1995 to market jointly the Russian Proton and the U.S. Atlas rockets. Today, the ILS partners share the revenue they make on each Proton launch. The money coming in has financed much of the recent growth in Baikonur’s facilities. New Western-standard cleanrooms have been built, as have several modern hotels to house the growing number of launch-related guests and participants. The Proton’s launch pads are kept up to par and are the most active in the Cosmodrome, along with the International Space Station and the Soyuz launch pads supported through the Starsem joint venture.

The Proton has become popular with most of the largest commercial satellite operators for a number of reasons: It is one of the world’s most reliable rockets, and can be turned around between launches in as little as two weeks. (Last year, the Proton was used 14 times, a world record that included five launches in one month alone.) It can more precisely inject satellites into their orbits than many other rockets, allowing operators to conserve their spacecraft’s fuel and expand the in-orbit lives of their $250 million assets, a price comprising the cost of the spacecraft, launch services and insurance. The Proton can also lift heavier satellites into orbit than many of its competitors, a feature that has made the Proton a launch vehicle of choice in recent years, as spacecraft have become much heavier. This was one of the main reasons Panamsat selected it to launch PAS 10.

PAS 10 is an 8,000 pound Boeing 601 HP that carries 24 C-band and 24 Ku-band transponders. Its footprints reach some 60 percent of the world’s landmass and 80 percent of its population. Its various beams link Europe, Africa, the Mideast, Asia, and India.

Replacing A Working Bird

It was on the charter flight to Baikonur that I had my most extensive interview with Doug Kahn. Throughout the trip, I was struck by his down-to-earth demeanor, which in many ways exemplifies his approach to Panamsat’s corporate culture. He relates openly to all of his employees, making no “class” distinction based on the seniority of their titles or level of responsibility. But make no mistake; he is a stickler for quality. He told me he believes in a performance driven organization, whereby each employee’s goals are “clearly specified, and those who perform well should be rewarded well (and vice verse).”

This philosophy is also apparent in Kahn’s approach to satellite manufacturing. It is no secret that Panamsat’s satellites have suffered from a high degree of in-orbit failures, both partial and full. Now, Panamsat’s customers are demanding greater degrees of back-up capacity so they won’t be left in the dark if a satellite goes out of service. Kahn believes the growing number of spacecraft anomalies is a result of over-intense competition that affects their builders’ bottom lines. “It doesn’t help our industry if satellite manufacturers’ profit margins are too thin,” he says. In fact, Panamsat is willing to pay more, by building in large incentives for satellites that perform to specification and meet the agreed-upon timetables for delivery. “I have no problem with paying satellite manufacturers a premium, as long as the product works,” he says emphatically. “If it doesn’t, I want it to hurt them the way it hurts me and my customers.”

PAS 10 is an excellent example of the way in which Panamsat is responding to the spacecraft-quality conundrum. Two years ago, PAS 4’s primary satellite control processor (SCP) failed, leaving the satellite to rely on its back-up SCP. Since both SCPs are made from the same material and components, the reliability of the back-up system has always remained in question. Most of PAS 4’s Ku-band customers were moved to PAS 7, but the C-band services could not be transitioned since coordination problems in that band prohibit its full operation. To ensure continued reliability to the remaining PAS 4 customers, Kahn personally insisted to the Panamsat board of directors that a replacement satellite was necessary. In many respects, this is an unheard of approach to customer service: “PAS 10 in effect represents a $250 million investment on Panamsat’s part to replace a perfectly functioning satellite because our customers were concerned,” says Kahn.

Some of PAS 10’s largest users are from Africa, a region long under-served by the satellite industry. Today, Africa is covered by a variety of Panamsat satellites as well as those from a growing number of competing operators. In August 1995, Panamsat jumpstarted the African direct-to-home market with the launch of PAS 4, which carried a high-powered Ku-band spotbeam focused on South Africa. Multichoice, for example, provides some 600,000 subscribers in Ku-band and 90,000 in C-band with movies, sports, news, niche channels and audio services via Panamsat satellites. “Replacing PAS 4 has been a big relief for us,” says Eben Greyling, CFO of pay television platforms at MIH Holdings Ltd. “We’ve been waiting for this day for a long time.”

Cynthia Boeke is the Editor of Via Satellite