With the official commercial launch of WildBlue‘s two-way satellite Internet slated for this week, company CEO Tom Moore is confident that the delays in getting to this point ultimately will result in a successful service launch.

“It certainly takes longer than you would ever anticipate to raise a half a billion dollars, build brand new satellites, design a brand new DOCSIS-based system end-to-end from scratch, put in place a distribution system and so forth,” Moore told Satellite News. “But our whole approach to deploying the service is to have exemplary customer experience. The rural market will be there for some time and the worst we can possibly do is come out and stub our toe in any way. So we worked longer to make sure the service was truly ready for commercial rollout.”

Moore is hoping the extra time needed to get to market will help separate WildBlue from the other satellite broadband services on the market.

“I think there have been times in the past that satellite broadband has been rolled out too quickly before it was ready,” Moore said. “We only have one chance to make a really good first impression and we wanted to make sure we got that right.”

Moore’s confidence on this being the right time and all the pieces being in place stems from the positive feedback the company has been receiving from its beta test customers. No significant issues arose from those trials, he said.

“We found the typical kinds of things you would anticipate in a beta trial,” Moore said. “That is why you have a beta trial so you can work through your processes, tweaking software, tweaking or changing configurations on your network, but we found no major kinks.”

What WildBlue did find is a high satisfaction rate among its users. “The beta experience that we’ve seen from our customers is a 97-98 percent [giving the service] either a satisfied or very satisfied customer rankings,” Moore said. “We are really excited about that.” He said that WildBlue has “hundreds of customers” engaged in beta testing of the service, but he declined to give a specific number.

To put the satisfaction numbers into perspective, Moore talked about his own experience. He has WildBlue set up in his home, as well as 3 megabits-per-second cable Internet service. Both services run through a router, allowing Moore to switch back and forth between them. He said his wife and two children, ages 10 and 11, use the Internet extensively in his home.

“I switch my satellite service in and out every three or four days,” Moore said. “My family cannot tell the difference. To us, that is the test. If my family cannot tell the difference between the two services, then that is good enough.”

Defining Success

Moore took his family test anecdote one step further when asked how WildBlue is defining success. “The way we talk about [success] around here is I have what I called ‘the significant other test.’ That is if you could sell our service, not give our service, to the most important person in your life and be proud to do that, then that is the exemplary customer experience objective we are striving for.”

Moore would not share the company’s specific subscriber targets. “The customer experience is more important to us in the short- to medium-term than raw numbers. We are not trying to add ‘x’ number of subscribers at any cost. We are trying to add really happy subscribers and then ramp that up as quickly as we can,” he said, noting that if the company can nab tens of thousands headed toward hundreds of thousands throughout the next year to two years, “that is a successful rollout to us.”

Those numbers may be ambitious.

A good benchmark to help put WildBlue’s goals in perspective would be to compare it with the Direcway service offered by Hughes Network Systems (HNS). Mike Cook, senior vice president of North America at HNS told Satellite News that the company will be announcing in the coming weeks that it has reached the 250,000-subscriber mark, a milestone that has taken HNS nearly four years to hit.

But Moore believes WildBlue will be able to, based on the results from its beta trial, surpass Direcway’s current rate of subscriber additions.

Today, Direcway probably installs about 10,000 new customers per month,” Moore said. “We think we should be able to do that well or better, certainly much better than that over time” based on WildBlue’s advantage in offering higher speeds, smaller dishes and lower prices.

From a competitive standpoint, HNS Chairman and CEO Pradman Kaul is not concerned that WildBlue is coming to market at a lower price point compared to the Direcway service.

Kaul acknowledged that WildBlue is “a strong competitor” but that HNS enjoys the advantage of being in the market years ahead of WildBlue. “It will take them a little time to get quality of service” levels up, he said.

And for the moment, competitive issues are not on the radar of HNS. The business plan of Direcway calls for the addition of customers to be achieved in such a way that helps to maintain a break-even or better cash flow.

“We are at a stage, like DirecTV, that we can go get as many subscribers as we want,” Kaul said. “It is just a question of how much we want to spend.” But rather than spend wildly to boost subscriber numbers, Kaul said HNS can “afford to get 120,000 subscribers per year.”

Bundling With DTH

While the early focus of WildBlue will be centered on selling service to a potential 20 million to 25 million subscribers across rural America, Moore did not rule out working with either DirecTV, Echostar or both to offer potential customers a bundled package.

“We have spent a lot of time with both Echostar and DirecTV trying to convince them the customers really want a bundled product of high-speed data and video,” Moore said “I think that really makes a lot of sense from the customers’ perspective and quite frankly I think it will make a lot of sense from Echostar’s and DirecTV’s perspective. If we deliver on the promises we have been touting, I think it would be only a short time before we have a relationship with one or both of those companies.”

And Moore may have a proverbial ace up his sleeve with some intellectual property WildBlue possesses. “We have a patented technology on a dish that we designed that allows us, in combination with the fact that the Anik F2, our first satellite, which is right in the center of the orbital arc between 101 degrees West and 119 degrees West, to offer both services off our same small dish,” Moore said. “A more comprehensive relationship with DirecTV and/or Echostar is needed to offer DTH and satellite Internet services in a customer friendly way.” (Telesat operates the Anik F2 satellite. WildBlue has plans to launch its own satellite that will share an orbital location with Anik F2.)

Moore did not rule out offering service in conjunction with terrestrial wireless service, something he sees as more complimentary than competitive. “The issue in rural America is not the last mile,” Moore said. Wireless is commonly regarded as being the last-mile solution that will provide the cost efficient alternative the will reach were landline networks do not. “It is not getting from the central office to the house or the headend to the house. In many cases, it is getting affordable backhaul from the central office to the point of Internet connectivity and doing that in an affordable way,” he said.

“There is a perception in rural America that it is a last-mile issue and if you can cover that with wireless then everything would work fine. That is really not the case,” Moore added. “If it was the case, cable companies would just upgrade their plants. It usually is the backhaul that doesn’t work economically. These wireless technologies will be great augmentations for us and are not really competitors for us.”

–Gregory Twachtman