New York City-based AirTV’s search for funding did not stop the startup from signing a launch services agreement with Arianespace last week, with the first launch scheduled for 2007.

The fledgling live-television service is designed to deliver enhanced in-flight entertainment and connectivity to airlines worldwide. The AirTV system would provide passengers aboard commercial aircraft with 60-plus channels of live television in multiple languages along with that all-important 40 Mbps of Internet access, e-mail and data services.

The plan is for the company’s AirTV 1 satellite to be orbited by an Ariane 5. The satellite then would be positioned above the North Atlantic to begin AirTV’s commercial operations onboard planes flying between America, Europe and the Middle East. If demand warrants, additional spacecraft could be launched to fill out AirTV’s constellation and to provide coverage for aircraft flying other commercial routes worldwide.

John Larkin, AirTV’s chairman and CEO, said he is convinced in-flight entertainment will be driven by live television and Internet services. His company’s focus is to become the most efficient and effective way to deliver these services worldwide.

Jean-Yves Le Gall, Arianespace CEO, said his company would help AirTV in its search for financing in addition to launching its first satellite.

Arianespace’s offer to help AirTV find financing shows that launch-services providers need to do more than they have in the past to win and to keep customers. Major satellite operators are limiting their launch of new spacecraft largely to replacement satellites in addition to tapping HDTV or other practically “can’t miss” business opportunities that offer more immediate payoffs. As a result, startup companies in need of financing offer a less certain but still viable additional customer bases.

AirTV is working with an export-credit-guarantee agency to secure debt financing for its first satellite. It also is developing its system with a European consortium that includes EADS and other suppliers.

(John Larkin, AirTV, 212/572-4875)