A Response to LA Times Article about Satellites Still in Orbit – Is the Cup Really Half Empty?

By Bruce Elbert, President, ATSI

Major newspaper articles about the satellite industry are relatively infrequent, and so we have to be grateful for what we get. Such is probably the case with this LA Times article from December 1, 2008, titled “With vintage satellites still in orbit, sales are grounded”:

http://www.latimes.com/business/la-fi-satellites1-2008dec01,0,2501895.story

The good news is that the article showcases the excellent operating record of commercial communications satellites, in terms of longevity and reliability. The bad news is that it fails to address the fact that while satellites last a long time, they are still very much a good investment for satellite operators and business for manufacturers. In this response, I address what I feel are the critical omissions from this article:

The article asserts that vintage satellites like ATS-3 (launched in 1967) and Marisat F2 (launched in 1976) indicate that satellites live and provide services for durations two or more times longer than planned. The reality is that while satellite hardware can and does survive that long in space, the useful lifetime in commercial is limited in duration to less than 20 years on the outside. It is based primarily on the quantity of fuel on board that is needed to correct for orbital distortion produced by gravity effects from the earth, moon and sun. The amount of fuel remaining on board will determine the years of life remaining, and this known to within a few months accuracy when the satellite enters service. The article refers to these satellites as GEO satellites, where GEO is an abbreviation for Geostationary earth orbit. The satellites that provide TV services, such as for DIRECTV and DISH Network, are of the GEO type since the ground antennas are fixed in position. A satellite like Marisat is in Geosynchronous orbit, meaning that its orbit is not fully corrected. This reduces the required fuel consumption to less than 10% of what is needed for a GEO satellite; this is why such a satellite can provide services well past 20 years. It would require the use of tracking antennas such as what NASA uses at its tracking facilities and what are found on ships at sea.

That satellite lifetime is now in the 15 to 20 year range is good news because of the increased size of the investment needed to get it up and working. The $300 million price tag indicated in the article is not far off for the largest class of satellite, like the Spaceway satellite built by Boeing for Hughes Network Systems. However, Orbital Sciences produces a smaller but viable satellite that with an associated price of under $200 million. Both prices include three principal elements: the spacecraft made by Boeing and others; the rocket to put it into orbit; and launch insurance to address an average launch failure rate of about 5% (that is, one should plan on having one satellite launch failure per 20 attempts).

What one should take away from this article is that satellites can be attractive investments because of long, predictable lifetimes. They provide services not possible from other means, yet can compete with like digital wireless and fiber in some applications. The number of satellites in use, which is in excess of 250 in GEO, is being maintained and their individual performance increased through higher power and performance-enhancements like spot beams, on-board digital processing, and electric propulsion. The LA Times laments that their major local producer, Boeing Satellite Systems, has had a sales drought, but fails to mention their success with a big government program call the Wideband Global Satellite (WGS). The first of these satellites entered service this year and there are several more in the pipeline. Evidenced by such programs, Boeing is in a solid position in terms of technology leadership and manufacturing capability. Other satellite manufacturers have had an average year in terms of sales and launches, indicating that solid buyers like Intelsat, SES and JSAT are very much committed to the industry’s continuation for decades to come.

As a satellite engineer who has seen some of his “children” enter service, I certainly agree with colleagues in the article that it can be emotional when they reach the end of their lives. But, it’s also been my experience that each of them was replaced with a new, more effective bird that further extends the reach and utility of this excellent medium of communications.

Bruce Elbert has over 30 years experience in satellite communications and is president of consulting firm Application Technology Strategy, Inc. (ATSI), which assists major users and developers of satellite systems and applications. He is an author and educator in this field, having produced seven titles and conducted technical and business training around the world. During 25 years with Hughes Electronics, he directed major technical projects and led business activities in the US and overseas. He is the author of The Satellite Communication Applications Handbook, 2nd edition (2004, Artech House). Web site: www.applicationstrategy.com.