Canada's Telesat launches $3B low Earth orbit satellite deal
Canadian satellite company Telesat on Tuesday tapped Thales Alenia Space to build 300 low Earth orbit (LEO) telecommunications satellites in a contract worth about US$3 billion, saying the first launch would be in about two years.
LEO satellites operate 36 times closer to the Earth than traditional ones so they take less time to send and receive information, leading to better and faster broadband service even in remote areas.
“We are extremely bullish on the opportunity to get into the market and capture the really surging demand for global broadband connectivity,” Telesat president and CEO Dan Goldberg said in an interview. “We're going to start launching our first satellites in about two years time. We'll be in service in the higher latitudes in late 2023, and then we'll have full global service in 2024.”
Thales Alenia Space (TAS) is going to build the first 13 satellites at its facility in Toulouse, Hervé Derrey, TAS president and CEO, said. TAS is a joint venture between Italy's Leonardo and France's Thales.
Telesat's satellites will create a “revolutionary new constellation program that will really outperform all existing and conceived programs,” Derrey said.
Telesat is moving into the competitive new realm of LEO networks with the aim to service socalled enterprise customers who include mobile operators, governments, aircraft and shipping companies. “This is not a consumer broadband play,” Goldberg said.
Most of the LEO competition — which includes Elon Musk's Spacex and its Starlink constellation and Jeff Bezos's Blue Origin and its Project Kuiper — is focused on the consumer market.
Financing will be finalized in the “coming months,” Goldberg said, adding that about US$2 billion will be in equity and US$3 billion in debt for the total US$5 billion project. The privately held Telesat, owned by Canada's Public Sector Pension Investment Board and Loral Space & Communications Inc, will become a public entity on the Nasdaq at about mid-year, Goldberg said.