Standard & Poor’s Rating Services has downgraded Telesat Canada‘s debt rating. S&P analyst Barbara Komjathy said the company’s biggest challenge is excess capacity on satellite and fiber-optic networks, which could slow the pace of growth into the U.S. and South American markets.

In addition, Telesat has been hurt by weak demand from Teleglobe and other telecommunications customers. S&P chopped Telesat’s long-term corporate credit and senior unsecured debt to “BBB negative”, the last investment grade before high-yield or junk status. It had been at the “BBB positive” rating since issuing its first debt four years ago.