September 2004 - SatMagazine

COVER STORY 

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17 

September 2004 

SATMAGAZINE.COM

TABLE OF 

CONTENTS 

COVER STORY 

FEATURES 

Vol. 2 No. 5 



Click on the title to go 

directly to the story 

2 

16/ Satellite Services to 

the Fore 

By Virgil Labrador 

Satellite service revenues is 

the one bright spot in the 

industry, having tripled since 

1996 . See how growth in 

satellite services can revive the 

other ailing sectors of the 

industy, like manufacturing 

and launch services. 

19/ Narrowcasting: 

Capturing Audiences 

from Space 

By Dan Freyer 

Dan Freyer shows how to 

captivate shoppers and 

employees with satellitedelivered 

messages. 

22/ ArabSat 

Relaunch Imminent 

By Chris Forrester 

Middle East satellite 

operator . ArabSat has made 

some serious management 

and structural changes 

ahead of a relaunch of its 

services. 

24/ Building Entrepreneurial 

Enterprises: Lessons from 

AT&T and ENRON 

By Dr. Dean Robb 

More than ever, sustaining 

success in the marketplace 

requires building 

entrepreneurial capabilities. 

Learn from the lessons of 

AT&T and ENRON. 

REGIONAL 

UPDATE 

27/PCM Thrives in 

Hong Kong’s “Wild East” 


Satellite and broadcast 

service provider Pacific 

Century Matrix (PCM) has 

been overcoming some very 

serious challenges in the 

Hong Kong market. 


EXECUTIVE 

SPOTLIGHT 

31/Interview with ILC’s 

Vice-President and COO 

Mark Krikorian 

Atlanta, GA-based network 

management company ILC 

has been growing an average 

of 40% in the last three 

years. We speak to its Vice- 

President and COO Mark 

Krikorian to uncover their 

secrets. 

REGULAR DEPARTMENTS 

3/ Note from the Editor 

4/ Calendar of Events 

5/ Industry News 

9/ New Products and Services 

11/ Executive Moves 

14/ Featured Event: ISCe 2004: Going from 

Strength to Strength 

29/ Viewpoint: Satellite Services: From Supply 

Push to Demand Pull 

by Bruce Elbert 

33/ Market Intelligience: Satellite Voice over IP: A 

Market for New Links in Africa’s ICT Chain 

(presented by the Global VSAT Forum) 

36/ Stock Monitor/ Advertisers’ Index 

SATMAGAZINE.COM

NOTE FROM THE EDITOR 

A Blessing or a Menace? 

It’s official, private investment firms have pulled off 

the trifecta—acquiring three of the largest satellite 

operators in the world in just the last few months. 

By now everyone is familiar with the details. It all 

started with the purchase of the third largest 

operator which pioneered the commercialization of 

the industry, PanAmSat, by the equity firm of 

Kohlberg Kravis Roberts & Co. (KKR), The Carlyle Group and 

Providence Equity Partners, Inc. last April for $4.5 Billion. That deal 

received regulatory approval and was finalized last month (after 

deducting $200 million from the price due to the Galaxy 10R failure). 

This was followed by The Hague-based New Skies Satellites, the 

Intelsat spinoff, acquired by the Blackstone Group for almost $1 

Billion. 

And finally the granddaddy of them all—Intelsat, was acquired 

August 16 by Zeus Holdings Limited, a company formed by a 

consortium of funds advised by Apax Partners, Apollo Management, 

Madison Dearborn Partners and Permira Advisers for $ 5 Billion. 

Private equity firms now control all but one of the satellite operators 

with global coverage—leaving only Luxembourg-based SES Global 

(it is not for sale). If you count the acquisition of global maritime 

satellite operator, Inmarsat at the end of last year by Apax and 

Permira, private investment firms have really got a corner on the 

global satellite business. 

The jury is still out, however, on what effect the influx of private 

equity firms will have on the industry. Initial reactions are very 

positive. In a survey conducted by Futron Corp. of over 700 satellite 

executives that attended the recent ISCe 2004, 88% said that an 

increase in financial/ equity investment in the industry is a positive 

development. 

Reactions are mixed, however, among industry watchers. Northern Sky 

Research aptly headlined a recent release “Private Equity Firms: 

A Blessing or a Menace for the Satellite Industry?” 

The New Skies and Intelsat deals are still subjected to regulatory 

approval. There are, however some telltale signs to the deals that 

consolidation is in the offing. Some analysts are pointing out that 

Apax and Permira figuring in both the Inmarsat and Intelsat deals 

may pose a conflict of interest. 

So stay tuned. We will be following developments in this story very 

closely. 


Published monthly by 

Satnews Publishers 

800 Siesta Way, 

Sonoma, CA 95476 USA 

Phone (707) 939-9306 

Fax (707) 939-9235 

E-mail: design@satnews.com 

Website: www.satmagazine.com 

EDITORIAL 

Silvano Payne 

Publisher 

Virgil Labrador 

Managing Editor 

and Editor, North America 

Chris Forrester 

Editor, Europe, Middle East 

and Africa 

Bernardo Schneiderman 

Editor, Latin America 

Peter I. Galace 

Editor, Asia-Pacific 

John Puetz, Bruce Elbert 

Dan Freyer, Howard Greenfield 

Contributing Writers, 

The Americas 

David Hartshorn, Martin Jarrold 

Contributing Writers, Europe 

Baden Woodford 

Contributing Writer, Africa 

Jill Durfee 

(jill@satmagazine.com) 

Advertising Sales 

Joyce Schneider 

(joyce@satnews.com) 

Advertising Sales 

Satnews Publishers is the leading 

provider of information on the 

worldwide satellite industry. Fore 

more information, go to 

www.satnews.com 

Cover Design by: Simon Payne 

Copyright © 2004 

Satnews Publishers 

All rights reserved. 

3 


SATMAGAZINE.COM


4 

CALENDAR OF EVENTS 


September 9-14 Amsterdam, The Netherlands IBC 2004 

Tel. +44 (0)20 7611 7500Fax: +44 (0)20 7611 7530 

E-mail: registration@ibc.org 

Web: www.ibc.org 

September 13-16 Houston, Texas, USA Offshore 

Communications 2004 

Inger Peterson Tel. +1-877-270-7102 

E-mail: ipeterson@offshoresource.com 

Web: www.offshorecoms.com 

September 14-15 (Seminar) September 14-17 (Exhibition) 

Tianjin, People’s Republic of China PTC Mid-Year Seminar 

and Exhibition 2004 Contact: Dolores Fung 

Tel.: +1.808.941.3789, ext.120 

Email: dolores@ptc.org Web: www.my2004.org 

September 20-23 Venice Lido, Italy Broadband World 

Forum Europe 

Tel. 1-312-559-4600 / Fax: +1-312-559-4111 

E-mail: events@iec.org Web: www.iec.org/events/2004/bbwf/ 

index.html 

September 21-24 Buenos Aires, Argentina Expo Comm Argentina 

Beth Harrington Tel 301-493-5500 ext. 3312 

E-mail: harrington@ejkrause.com Web: www.ejkrause.com 

September 28- 30 St. Pete Beach, Florida, USA SUIRG 

CONFERENCE 2004 Tel. and fax: +1-941-575-1277 

E-mail: bobames@suirg.org Web: www.suirg.org 

September 30-October 2 Vicenza Fair, Italy SAT EXPO 2004 

Tel. +39-0444-543-133Fax: +39-0444-543-466 

E-mail: promospace@satexpo.it Web: www.satexpo.it/en/index.php 


SATMAGAZINE.COM

INDUSTRY NEWS 


5 

FCC OKs Sale of PanAmSat to Equity 

Firms; Price Cut by $200 Million 

Because of Galaxy Failure 

The launch of DirecTV-5 on May 

7, 2002 aboard a Proton rocket. 

(ILS photo) 


The Federal Communications 

Commission 

has approved the sale 

of PanAmSat to 

affiliates of Kohlberg 

Kravis Roberts & Co., 

L.P., The Carlyle Group 

and Providence Equity 

Partners, Inc. The FCC 

approval, obtained last 

August 11, was the 

last in a series of 

regulatory approvals 

needed for the 

completion of the 

transaction. 

DirecTV also said it 

had cut the price on 

the sale of in 

PanAmSat to the three private equity firms by $200 million to 

approximately $2.6 billion following the failure of a PanAmSat 

satellite. The price reduction resolves the effect of the xenon ion 

propulsion failure of Galaxy 10R PanAmSat satellite last August 

3. PanAmSat said the agreement does not affect the $23.50 per 

share purchase price to be paid to the other PanAmSat shareholders. 

“Now that we have received all necessary approvals, we are 

looking forward to the ultimate completion of the deal next 

week,” said Joe Wright, president and CEO of PanAmSat. “We 

look forward to a great future with our new owners.” 

PanAmSat expects its shareholders to approve the transaction at 

their annual meeting today, which will permit the parties to close 

the merger with a subsidiary of the DirecTV Group on Wednesday, 

August 18, and the purchase of stock from DirecTV Group 

on Friday, August 20, assuming the satisfaction of other closing 

conditions. 

“All the pieces are in place to close the transactions next week,” 

said Chase Carey, president and CEO of the DirecTV Group. 

“This transaction continues to be a good value for our shareholders 

and enables us to take one more step toward our goal of 

focusing resources and management time on our core DirecTV 

business.” 

Alexander Navab, a partner of Kohlberg Kravis Roberts & Co. 

L.P., said the equity sponsor partners continue to be excited 

about owning PanAmSat and that they are pleased with the rapid 

resolution of these issues. 

Private Investors Buy Intelsat 

for $5 Billion 

Intelsat, Ltd was sold last August 16 to a consortium of four 

private investors for US$5 billion marking the completion of the 

company’s transformation to a private company. 

In a transaction unanimously approved by the company’s Board 

of Directors, Intelsat signed a definitive agreement that provides 

for the amalgamation under Bermuda law of Intelsat and a 

subsidiary of Zeus Holdings 

Limited, a company formed 

by a consortium of private 

equity groups: Apax Partners, 

Apollo Management, 

Madison Dearborn Partners 

and Permira Advisers. 

The total value of the 

transaction, including 

approximately $2 billion of 

existing debt, is approximately 

$5 billion. 

Intelsat Global Service 

Corp. Headquarters in 

Washington, DC 

Intelsat for most of its 40 years, it has been owned and governed 

by companies representing 145 governments around the world. 

It is mostly known for transmitting the world’s first satellite 

phone call, for carrying live international television broadcasts 

of the Olympics, and for transmitting the 1969 Apollo 11 moon 

landing around the world. 

If the deal wins regulatory and shareholder approval, Zeus will 

be acquiring Intelsat, and Intelsat’s current shareholders will be 

entitled to receive $18.75 for each Intelsat share issued, according 

to an Intelsat news release. Intelsat expects to obtain all 

required approvals and closing to occur as early as the end of 

2004. 

“This transaction comes at a time when Intelsat is successfully 

executing on its strategies for market leadership in the fixed 

satellite services sector. We believe that the acquisition of 

Intelsat by this consortium of well-respected private equity 

investors represents the best opportunity for Intelsat to achieve 

its strategic goals,” said Intelsat, Ltd. Chief Executive Officer 

Conny Kullman. 

SATMAGAZINE.COM

INDUSTRY NEWS 


6 

Report Says Customer Satisfaction 

Among Satellite Subscribers 

Continues to Top Cable 

released last month. 

Overall customer 

satisfaction among 

satellite TV service 

subscribers outpaces that 

of cable customers, as 

satellite penetration 

continues to grow, 

according to the J.D. 

Power and Associates 

2004 Residential Cable/ 

Satellite TV Customer 

Satisfaction Study 

Although cable subscriptions still dominate the industry, satellite 

market penetration continues a steady eight-year climb, with 

nearly one in four households now subscribing to satellite pay 

TV. 

The study is based on responses from 8,668 U.S. households 

who evaluated their satellite or cable TV providers. 

Satellite received an overall customer satisfaction index score of 

723 (on a 1,000-point scale), compared to 659 for digital cable and 

621 for analog cable, with strong performance across all measures 

of customer satisfaction. Despite this outcome, cable 

narrowed the gap in overall satisfaction versus satellite, improving 

at nearly twice the rate of satellite (3.1% vs. 1.6%). 

Both satellite providers included in the study received the two 

highest customer satisfaction rankings among the 13 largest 

providers of cable/satellite TV service. Dish Network regained its 

highest ranking from 2000, receiving top ratings from customers 

in three of the six factors that drive overall satisfaction: billing, 

cost of service, and offerings and promotions. 

EchoStar Adds 340,000 New 

Subscribers; Decreases Net Incom 

$ 85 Million in 2nd Quarter 

EchoStar Communications Corp. added 340,000 new subscribers 

for the quarter, increasing the company’s Dish 

Network satellite television subscribers to 10.125 million as of 

June 30, 2004. 


SATMAGAZINE.COM

INDUSTRY NEWS 


7 

In a statement, EchoStar said it 

had total revenue of $1.78 billion for 

the quarter ended June 30, 2004, a 26 

percent increase, compared to $1.41 

billion for the corresponding period in 

2003. It said net income totaled $85 

million for the quarter compared to net 

income of $129 million during the 

corresponding period in 2003. Basic 

earnings per share was $0.18 for the quarter, compared to basic 

earnings per share of $0.27 last year. 

EchoStar also announced that its board of directors has authorized 

the repurchase of an aggregate of up to an additional $1 

billion of EchoStar’s Class A Common Stock. 

XM Reports a Wider Loss But Adds 

418,449 Subs In Quarter 

XM Satellite Radio Holdings Inc. (NASDAQ:XMSR) has posted 

a wider net loss of $166.1 million for the second quarter compared 

to $161.9 million loss in the second quarter of last year. But 

XM redeemed itself by reporting 2,100,352 subscribers, or an 

addition of 418,449 for the quarter, more than double net subscriber 

additions of 209,178 subscribers in second quarter 2003. 

For second quarter 2004, XM reported quarterly revenue of $53.0 

million, nearly tripling the $18.3 million reported in the second 

quarter 2003. Revenue for the second quarter 2004 also represented 

a 23 percent increase compared to revenue of $43.0 

million reported in the first quarter 2004. 

XM reported an EBITDA loss of ($107.8) million for the second 

quarter 2004, compared to ($95.8) million for the second quarter 

2003. On a per share basis, however, losses narrowed to 84 cents 

from $1.38. 

Because of the subscriber growth, XM increased its revenue and 

subscriber forecast for the full year to $220 million and 3.1 

million, respectively. The company had previously forecast 2.8 

million subscribers by the end of the year. 

“With our programming, marketing and new product initiatives, 

we feel confident increasing our year-end 2004 subscriber 

guidance to 3.1 million,” said Hugh Panero, XM CEO and 

President. 


ILS Proton Successfully Launches 

Amazonas Satellite 

The Proton launch vehicle roared from pad 39 at the Baikonur 

Cosmodrome at 4:32 a.m. on August 5 (6:32 p.m. EDT, Aug. 4) 

carrying the Amazonas satellite for customers Hispasat and 

Hispamar and manufacturer EADS Astrium. The rocket’s Breeze 

M upper stage placed the satellite into a transfer orbit 9 hours 

and 11 minutes later. 

The launch vehicle was built by Khrunichev State Research and 

Production Space Center of Moscow, a partner in the ILS joint 

venture along with Lockheed Martin Corp. [NYSE:LMT]. This 

was the third Proton launch of the year for ILS, and the seventh 

mission overall for the company in 2004. 

With 51 transponders, Amazonas satellite will provide a full 

range of telecommunications services to Brazil, North and South 

America, and a transatlantic link for Europe. 

The Amazonas Latin American satellite will operate in geostationary 

orbit, at the 61°W orbital position over the Amazon 

basin, and will provide both fixed and broadcast communications 

services through 32 simultaneous operational transponders in 

Ku-band and 19 simultaneous operational transponders in C- 

band, over a 17.5-year mission lifetime. The services offered will 

include TV broadcasting, business services including VSAT and 

data broadcasting. 

Amazonas is the third Eurostar E3000 to be shipped to the 

launch pad in only four months. It fulfills Hispasat and Hispamar 

time to market expectations for Latin America. 

Antoine Bouvier, CEO of EADS Astrium said Hispasat is a long 

standing and important customer to EADS Astrium. “We have 

built their first-generation satellites, an important milestone in the 

development of our Eurostar product line on the world market. 

Now we deliver their most powerful satellite on schedule to meet 

their needs and support their expansion in Brazil and Latin 

American market.” 

Northrop Grumman Awarded $1.04 

Billion For X-47B Unmanned Combat 

Air Systems Program 

Northrop Grumman Corp. (NYSE: NOC) has been awarded a 

contract from the Defense Advanced Research Projects Agency 

(DARPA) to continue work on the X-47B portion of the Joint 

Unmanned Combat Air Systems (J-UCAS) demonstration 

program. Valued at up to $1.04 billion over five years for the 

SATMAGAZINE.COM


8 

INDUSTRY NEWS 

program’s operational assessment phase, the award includes 

initial funding of $30 million. 

The J-UCAS program is an effort by DARPA, the U.S. Air Force 

and U.S. Navy to demonstrate the technical feasibility, military 

utility and operational value of networked, unmanned, air-combat 

systems to suppress enemy air defenses, perform electronic 

attack, conduct intelligence, surveillance and reconnaissance 

missions, and perform precision strike attacks. 

The three objectives of the J-UCAS operational assessment 

program are to demonstrate the technical feasibility of developing 

a family of network-centric J-UCAS systems — managed by 

a common operating system — for operation from land or an 

aircraft carrier; to assess the joint operational utility of the J- 

UCAS concept in the mission areas of suppressing enemy air 

defenses, strike, electronic attack and penetrating surveillance 

and reconnaissance; and to develop production system concepts 

for the Navy and Air Force. SM 

In this phase, Northrop Grumman will produce and flight-test 

three X-47B unmanned demonstration vehicles with associated 

mission-control stations and logistical support elements. Flight 

demonstrations are expected to begin in 2007. 

Northrop Grumman’s Integrated Systems sector leads a J-UCAS 

team that includes Lockheed Martin Corp., and Pratt & Whitney. 

Work will be performed at facilities in El Segundo, Palmdale and 

San Diego, Calif., and East Hartford, Conn. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SATMAGAZINE.COM

EXECUTIVE MOVES 


9 

Ball Aerospace Selects 

Bill Townsend to Lead 

Civil Space Systems 

Ball Aerospace & Technologies Corp. 

has named William F. Townsend as vice 

president and general manager of civil 

space systems. Townsend is expected 

to guide the company’s NASA and 

NOAA programs to successful delivery. 

Ball Aerospace currently has many 

missions in various stages of 

completion including Deep Impact, 

Cloudsat, CALIPSO, HiRISE, Kepler and 

the optical subsystem for the James 

Webb Space Telescope. 

David L. Taylor, president and CEO of 

Ball Aerospace & Technologies Corp., 

said Townsend’s proven track record at 

successfully executing complex 

programs strengthens Ball Aerospace’s 

ability to deliver outstanding space 

systems to our customers. “He will work 

to ensure that the spacecraft and 

instruments we deliver to NASA and 

NOAA meet mission cost, schedule and 

quality requirements,” Taylor added. 

Prior to joining Ball Aerospace, 

Townsend had a distinguished 40-year 

career with NASA, most recently at 

Goddard Space Flight Center. At 

Goddard, he shared responsibility for 

executive leadership and management of 

the Center and all its programs as 

Deputy Director. Prior to that position, 

Townsend served as Deputy Associate 

Administrator (Programs) for the 

NASA’s Office of Earth Science, where 

he directed earth science flight 

programs. He was also acting Associate 

Administrator for the Earth Science 

Enterprise. He was responsible for 

numerous successful programs during 

his NASA career, including the SeaSat 

Radar Altimeter and TOPEX/Poseidon 

missions. In total, Townsend has been 

associated with 59 missions. 


Townsend’s accomplishments have been 

recognized with numerous awards 

including the NASA Distinguished Service 

Medal, the Presidential Rank Award of 

Meritorious Executive, the NASA 

Exceptional Service Medal and the French 

Space Agency’s Bronze Medal. Townsend 

holds an electrical engineering degree with 

honors from Virginia Polytechnic Institute. 

Patrick K. Brant Named 

President of Loral Skynet 

Loral Space & 

Communications 

named Patrick 

K. Brant as 

president of subsidiary 

Loral Skynet 

succeeding Terry Hart. 

Brant, 53, takes the 

helm at Loral Skynet as 

Loral prepares to file a 

plan of reorganization 

that should allow it to emerge from 

bankruptcy before the end of the year. 

Loral Skynet owns and operates a fleet of 

four telecommunications satellites that, in 

combination with its established hybrid 

VSAT/fiber global network infrastructure, 

provides secure, high-quality video 

broadcasting, broadband data 

transmission, Internet services and other 

value-added communications services to 

commercial and government customers. 

Brant served as an executive at Loral 

Cyberstar from 1999 to 2003, ultimately as 

its president and CEO. He was a leading 

participant in Cyberstar’s integration into 

Loral Skynet in 2003. His strong sales, 

marketing and business development 

background includes senior management 

positions at satellite companies, including 

Orbital Communications and American 

Mobile Satellite Corporation. He holds a 

Bachelor of Science degree in Economics 

from the University of Maryland. 

PanAmSat Promotes 

Mike Antonovich to 

Executive VP of Global 

Sales & Marketing 

Mike Antonovich 

PanAmSat Corp. has promoted 

Mike Antonovich to executive 

vice president of global sales and 

marketing. In this role, Antonovich is 

expected to aggressively lead the 

company’s global sales and marketing 

program which includes: program 

distribution, broadcast contribution, 

telecommunications and networking 

services. 

“Over the past 15 years, Mike’s insight 

and expertise in the broadcast and 

satellite industries have been critical in 

the development of PanAmSat’s customer 

portfolio and service offerings. He has 

been a key force in shaping the direction 

of the organization and helping it become 

one of the world’s leading satellite 

operators,” said PanAmSat CEO Jim 

Frownfelter. 

Since joining PanAmSat in 1989 as a 

manager of broadcast services, 

Antonovich has served in a wide variety 

of senior leadership positions including in 

North American sales, Pacific Ocean 

Region sales, global sales and most 

recently, assumed the responsibility of 

leading the Company’s marketing 

initiatives worldwide, serving as senior 

vice president of global sales and 

marketing. 

SATMAGAZINE.COM

EXECUTIVE MOVES 


10 

Prior to his tenure with PanAmSat, 

Antonovich worked for Group W Satellite 

Communications and the ESPN sports 

network in a variety of production, postproduction 

and operations positions. His 

experience in the broadcast and satellite 

industries spans over 25 years. 

Peter Chernin Signs 

New Five-Year 

Employment Pact 

News Corp. has signed a new, five-year 

employment pact with Peter Chernin, the 

company’s President and Chief Operating 

Officer, since 1996. 

Rupert Murdoch, Chairman and CEO said 

described Peter as a close and trusted 

colleague for more than a decade adding 

he is delighted that News Corp. will 

continue to have the benefit of his 

dynamic qualities for many years to come. 

“He has done a superb job growing and 

operating our core entertainment 

businesses in an increasingly challenging 

global marketplace. Peter is respected 

throughout our company and the industry 

for his intelligence, drive and leadership,” 

he said. 

Chernin joined News Corp. in 1989 and 

has been President and COO for the past 

eight years. He joined the company as 

President of Entertainment of the Fox 

Broadcasting Company, a position he 

held for three years. Under his leadership 

the network launched such hits as The 


Simpsons, In Living Color and Beverly 

Hills 90210. From 1992 to 1996, he served 

as Chief Executive Officer of Fox Filmed 

Entertainment, and oversaw such 

blockbusters as Speed, Independence 

Day and Titanic. 

Stratos Appoints Rich 

Harris as Senior Vice 

President and Chief 

Legal Officer 

Stratos Global Corp. has appointed 

Rich Harris as Senior Vice 

President and Chief Legal Officer, 

effective August 9, 2004. He will report to 

President and CEO, Jim Parm, and will 

oversee all corporate legal activities, 

including the provision of legal guidance 

to Stratos’ senior management and staff, 

and participating in critical commercial, 

regulatory and acquisition activities. 

A graduate of the University of 

Pennsylvania and Yale Law School, Harris 

comes to Stratos from Worldwide Retail 

Exchange, a joint business-to-business 

venture where he served as General 

Counsel. He also has an extensive 

background in international satellite 

communications gained with Comsat 

International, in Maryland, and Kokua 

Communications, in London. 

“Rich’s familiarity with the satellite 

industry, including experience with 

international mergers and acquisitions 

and legal negotiations involving major 

satellite operators and providers, as well 

as his background in international 

regulatory and licensing issues, is exactly 

what we were looking for to fill this 

important position as part of Stratos’ 

senior management team,” Jim Parm, 

Stratos’ president and CEO said. 

Harris will be based in Stratos’ corporate 

headquarters in Bethesda, MD. 

Lockheed Martin Board 

Elects Robert J. Stevens 

as President and CEO 

Robert J. Stevens, 

Lockheed Martin 

President and CEO 

The Lockheed 

Martin [NYSE: 

LMT] board of 

directors has 

elected Robert 

J. Stevens as 

President and 

CEO last week 

replacing 

Vance 

Coffman’s who 

retired after 37 

years with the 

company, 

including 

seven years as CEO. Coffman will serve 

as the board of director’s non-employee 

Chairman until April 2005. Stevens 

assumes his new duties as CEO while 

retaining his position as President. 

Stevens has held a variety of increasingly 

responsible executive positions including 

COO, CFO, and head of Strategic Planning 

through a career that has included 

experience in program management, 

finance, manufacturing, and operations. 

Stevens is a Fellow of the American 

Astronautical Society, and an Associate 

Fellow of the American Institute of 

Aeronautics and Astronautics. He serves 

on the International Advisory Board of 

the British-American Business Council, 

and on the Executive Committee of the 

Aerospace Industries Association. He is a 

member of the Council on Foreign 

Relations, and is Presiding Director of the 

Monsanto Company. During 2001 and 

2002, Mr. Stevens also served on President 

Bush’s Commission to Examine the 

Future of the United States Aerospace 

Industry. 

SATMAGAZINE.COM

NEW PRODUCTS 


11 

This year’s IBC2004 exhibition to be held in Amsterdam from September 10- 

14 will, as in previous years, showcase the latest products and services for 

the broadcasting and allied industries. Here are some of them: 

training and maintenance expense,” 

says ILC President and 

CEO Richard Graham. 

“MaxView is uniquely suited to 

the trend of NOC (network 

operations center) consolidation 

and centralized control that many 

broadcast facilities are undergoing, 

because it manages any 

equipment type, regardless of 

brand or protocol,” explains ILC 

Senior Vice President Mark 

Krikorian. “For example, MaxView 

eliminates the inefficient practice 

of consulting separate management 

systems when service goes 

down, instead helping operations 

staff to quickly isolate the cause 

of an outage and automatically 

restore service.” 

ILC to Demonstrate MaxView for 

Broadcast solutions at IBC 

Network control software developer ILC will be demonstrating its 

MaxView for Broadcast solutions at IBC 2004 stand 1.441.ILC 

will be showing broadcasters how they can control the entire 

broadcast facility, from station to uplink to transmitter site, with 

one system. MaxView for Broadcast solutions manage 

ingest, studio, playout, transmitter, satellite and IT infrastructure 

and environmentals to provide advanced control capabilities 

such as scheduling, service auto-recovery, carrier monitoring, 

diversity site switching, transmitter remote control and trouble 

ticketing. 

“At IBC, we will challenge conventional thinking by explaining to 

broadcasters how they can integrate operations that they have 

typically viewed as separate. MaxView for Broadcast solutions 

eliminate the common scenario in which each segment of 

the broadcast chain requires an additional software product, 


MaxView for Broadcasters 

solutions – including 2004 new 

releases MaxView CMS carrier monitoring system and 

MaxView Chorus trouble ticketing system — will be on 

display at ILC stand 1.441, where visitors can learn more about 

this suite of graphical tools that enables point-and-click operations, 

drag-and-drop user screen and automation scenario 

creation, and rapid system expansion without programming. 

Inmedia to Launch New Remote 

Playout & Distribution Solution 

Inmedia will launch its new Remote Playout & Distribution 

solution at IBC 2004. This new service uses Inmedia developed 

technology to dramatically reduce playout and distribution costs 

and is particularly aimed at channels that want to distribute 

regionally tailored content. By making it cheaper and easier for 

the channel owner to extend their services, this innovative 

solution will ensure that Inmedia keeps its position as the UK’s 

most successful independent playout provider – with over 35 

channels and counting. 

SATMAGAZINE.COM

NEW PRODUCTS 


12 

Targeted Television... 

Inmedia’s Remote Playout and Distribution service opens up 

new markets around the world. In one operation you can select 

your content, choose the appropriate audio track, add the correct 

subtitles, upload, and schedule the remote playout of multiple 

TV channels almost anywhere. The efficiency savings and 

reduction in access costs to remote markets are dramatic. 

Starting from a centrally held pool of digital assets, programming 

for each remote TV channel is created and scheduled directly 

from your desktop. Content is delivered in non-real time via 

satellite multicast or the Internet to remote playout servers for 

onward local distribution to your precisely targeted audience. So 

if you only have the rights to programming in certain regions, 

you can run schedules containing only the content you have 

purchased. 

Inmedia’s Sales Director for Broadcast Services, Matthew Ivey, 

says: “The Remote Playout and Distribution service is a prime 

example of Inmedia’s continuing drive to make running a TV 

channel more affordable. This innovative new application will 

allow operators to target new customers in new markets and has 

huge potential to get new TV channels onto platforms that 

would until now have been too expensive to access. Our 

calculations show that after a low start up cost, our remote 

service makes it possible for a content owner to add an additional 

TV territory for as little as £30K per annum, ideal if you 

want to target ex-pats in the Algarve or Japanese businessmen in 

London.” 

Each Remote Playout & Distribution device can select the 

correct audio channels for the targeted audience, run individual 

schedules, insert audience specific subtitles and insert a graphic 

to help identify the channel. The Remote Playout and Distribution 

device is located at a cable or satellite head-end. 

TANDBERG Television Will Launch 

Flexible, Open Cable VoD Platform 

IBC 2004 will see the public debut of TANDBERG Television’s 

open Video on Demand (VoD) platform. The platform has been 

designed to provide European cable operators with the freedom 

to choose best of breed technologies and to avoid proprietary 

architectures with all the associated downsides of vendor lockin, 

non-competitive pricing schedules and higher support costs. 

By combining zero compromise solutions from leading equipment 

vendors, cable companies can benefit from demonstrably 

lower cost of entry into the VoD space and reduced operational 

expenditure, as well as create a dynamic on demand environment 

to support future growth and meet changing consumer needs. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SATMAGAZINE.COM

NEW PRODUCTS 


13 

At TANDBERG Television’s IBC stand (Hall 1:461) visitors will 

be able to see the on demand content platform in operation, 

including live demos of the OpenStream digital services 

platform from N2 Broadband. As an open, standards-based 

system, OpenStream allows cable operators to easily deploy on 

demand services using VoD servers, applications, billing 

systems, and other system components of their choice. 

TANDBERG Television recently signed an exclusive agreement 

to market OpenStream throughout EMEA, as well as to work with 

N2 Broadband to provide Euro-centric solutions for the content 

on demand marketplace. 

“In a financial environment of increasing constraints on capital, 

it is imperative that new technologies are available at the lowest 

possible total cost of ownership. That is why we have developed 

our VoD platform to utilise open architectures, without sacrificing 

performance, security, privacy, or freedom of choice,” says Eric 

Cooney, CEO of TANDBERG Television. “N2 Broadband’s 

OpenStream platform is the only standards based, completely 

open architecture solution for Video on Demand back office 

management. Its open approach compliments our own commitment 

to non-proprietary architectures and combined with 

Entone’s VOD servers, we are providing the optimal solution for 

flexible, low-cost VOD deployment.” 

TANDBERG Television has worked with N2 Broadband to 

modify OpenStream for the European market, including consideration 

for core network differences, multilingual support and 

conditional access, as well as geographical and cultural differences. 

TANDBERG Television’s position as the market-leading 

cable head-end provider in Europe means the company brings 

considerable in-depth experience of many of the practical 

solutions that have allowed Europe’s major cable companies 

such as Auna, KDG, and Telenet to deliver class-leading services 

in a highly competitive market. 

“As European cable operators start to roll-out VoD services, they 

are in a position to benefit from the lessons learned in the US 

and to avoid the pitfalls of proprietary technology. By working 

with Europe’s leading cable technology provider, TANDBERG 

Television, we can rapidly extend the benefits of open systems 

to the European market,” says Reggie Bradford, president and 

chief executive officer of N2 Broadband. 

ND SATCOM Launches 

new SkyRAY Compact 

ND Satcom is launching a new generation of aerodynamic SNG 

antenna solutions at IBC, stand 1.359. Fixed on the standard roof 

mounts of the vehicle the compact Jet Box like casing houses a 

1,5m high performance SNG antenna. Further more the system is 

designed to accommodate the state-of-the-art ND SatCom high 

power 400W TWT amplifier or a redundant SSPA configuration. 

With this approach expensive modifications of the vehicle’s roof 

are no longer needed and in case of a vehicle’s breakdown, the 

system can be moved to another vehicle within a short period of 

time and therefore 

avoid long service 

downtimes. 

The design of the 

carbon fibre casing, 

which acts as an 

integral environmental 

protection during 

travel, has a height 

above roof of only 

55cm. 

The new SkyRAY 

Compact combines 

the need for a 

powerful uplink with 

the smart dimensions 

of a roof top box. 

SM 

ND SATCOM’s new 

SkyRAY Compact 


SATMAGAZINE.COM

FEATURED EVENT 

ISCe 2004: 

Going from Strength to Strength 


14 

ISCe 2004 attracted a very 

high quality of senior level 

participants including these 

panelists in the CEO 

Roundtable. Seated from left 

to right, Dean Olmstead of 

SES Americom, Mark 

Dankberg of ViaSat, 

Michael Butler of Inmarsat, 

Carmen Lloyd of Iridium, 

Saeed Al Hamli of Thuraya 

and Arnold Friedman of 

Space Systems Loral. 

Standing, on the podium is 

the moderator, Warren 

Ferster of Space News. 

O 

nly on its third year, the ISCe 2004 

Conference and Expo held in Long 

Beach, California last June 1-3 was a 

resounding success. The event was 

attended by over 1,000 participants 

representing a cross-section of the 

satellite industry worldwide. 

“We are very pleased with the progress 

we have made and the quality of the 

event," said the conference chairman, Art 

Paredes of Hannover Fairs, USA, the 

principal organizer of ISCe. “ISCe 

provides an ideal venue to meet senior 

executives in an intimate setting to 

discuss business opportunities and 

networking," he added. 


The three-day event had a conference 

and exhibition component organized 

around several fora such as Defense and 

Security, Global Navigation, Next- 

Generation Capabilities, US-Asia 

Business, Satellite Entertainment/DBS 

and many others. 

The event also included an industry 

leaders’ roundtable discussion featuring 

the CEOs of SES Americom, ViaSat, 

Inmarsat, Iridium, and senior representatives 

from Thuraya and Loral discussing trends 

in the industry and affirmed that the military 

use of satellites will continue to grow in the 

future. 

On the issue of whether recent 

deployments of military satellites by the 

government would reduce reliance on the 

commercial satellites sector for services, 

the executives agreed that this would have 

little or no impact and in fact military 

demand for commercial satellite services 

would continued to grow significantly. 

With VSAT leader Hughes Network 

Systems up for sale, there was some 

discussion of the future directions of the 

VSAT Market. 

According to Dean Olmstead of SES, 

“The value proposition has to shift from 

hardware to services.” He noted that SES 

SATMAGAZINE.COM


15 

FEATURED EVENT 

The ”Satellites and 

Natural Disasters” panel 

at ISCe featured from left, 

Steve Vaughn-- 

California Department of 

Forestry and Fire 

Protection, Virgil 

Labrador-SatMagazine, 

Tom Bleier--Quakefinder, 

David Gray--Lyman Bros. 

and Rob Knabe--Brookstone 

Equipment. 

has pushed for and supported open 

standards development, like DVB-RCS so 

that hardware prices go down, 

interoperability goes up and consumer 

price points move forward. 

DVB-RCS is a standard for the physical 

communications link layer, which uses 

DVB for the outbound carrier and 

multicarrier TDMA as the inbound. 

VSAT manufacturer ViaSat’s CEO, Mark 

Dankberg, said “manufacturers will follow 

customer demands” and added “All 

satellite operators are saying we want and 

open standard for VSAT” 

Olmstead offered a suggestion “that the 

military could, as a large buyer, force 

VSAT manufacturers to become standards 

compliant and interoperable in its 

procurement” 

Dankberg agreed, and said “The biggest 

issue is open standards for encryption 

systems for the US military use of VSATs 

for broadband communications.” 

Satnews Managing editor, Virgil Labrador 

chaired a session on “Earthquakes, Fires 

and Floods: Satellites to the Rescue” 

focussing on the role of satellite 

technology in natural disasters. The 

panelists included Tom Bleier of 

Quakefinder, Steve Vaughn of the 

California Department of Forestry and Fire 

Protection, Rob Knabe of Brookstone 


Equipment, and David Gray of Lyman 

Brothers. 

What’s in Store for 2005 

Organizers announced that the next ISCe 

will be held May 31-June 2, 2005 at the 

Hyatt Regency Long Beach Hotel. 

Paredes said that they are paying close 

attention to participants' feedback and 

will make exciting changes in the 

program designed to increase 

participants’ return on their investment 

and provide additional 

opportunities to develop 

commercial and government 

including military business 

at the show. 

Hannover Fairs also 

announced that The Carmel 

Group’s highly popular 

Satellite Entertainment and 

DBS conference “The Five 

Burning Questions” will be 

held concurrently for the 

first time at ISCe 2005. 

There will also be new 

Govermental and DOD- 

Satellite Requirements 

Forum at ISCe 2005 aimed at 

leveraging near- and longterm 

business opportunities 

in the government and 

military sectors, according 

to Paredes. 

Joachim Schafer, President of Hannover 

Fairs USA, Inc.,, said “Hannover Fairs will 

continue in its efforts to support the 

success of the satellite industry through 

events such as ISCe, which offers a 

unique forum for a productive information 

exchange among key industry 

stakeholders, vendors and users alike.” 

Sounds like a great plan. See you all at 

ISCe 2005! SM 

SATMAGAZINE.COM

COVER STORY 


16 

By Virgil Labrador 

The satellite industry may have reason to be more optimistic. 

At the recently-concluded ISCe 2004 show in Long Beach, 

California, the Satellite Industry Association (SIA) released it’s 

annual “State of the Satellite Industry” report and the findings 

were indeed very encouraging. 

The study was conducted for the SIA by Futron Corporation 

with the cooperation of the Global VSAT Forum (GVF) and the 

Satellite Broadcasting and Communications Association (SBCA). 

welcome relief. Transponder leasing after posting losses for two 

consecutive years, finally experience a turnaround in 2003, 

gaining a modest seven percent increase. 

According to the study, Direct-to-Home (DTH) services are 

driving the overall growth of the services sector. Satellite Radio, 

on the other hand, experienced a 400% revenue growth in 2003 

(although this still accounts for less than one percent of overall 

satellite revenues). 

For the eight year in a row since 1996, when the SIA and Futron 

began tracking the industry, world satellite revenues have 

increased every year at an average rate of 13 percent. In 2003, 

the world satellite industry grew a modest six percent (the 

highest growth experienced was30% in 1997). 

The most significant finding of the study, however, was that 

revenues from satellite services have continued to grow— 

increasing from 42% of total revenues in 1996 to over 60% in 

2003. This means that satellite services comprised the largest 

revenue stream for the industry as a whole. In fact, the satellite 

services sector has more than tripled in size from 1996 to 2003. 

There are some bad news, of course. Satellite manufacturing and 

launch segments continue to suffer huge losses and the 

prospect of recovery are dim for the near-term. But for an 

industry plagued with overcapacity and falling transponder 

rates, the news that satellite services sector is growing is a 


Source: State of the Satellite Industry 2003, SIA/Futron. 

SATMAGAZINE.COM

COVER STORY 


17 

markets, standard definition digital channel and feed growth will 

continue to be the main demand driver for new capacity leases. 

The global number of standard definition digital channels and 

feeds broadcast is anticipated to increase to over 17,500 in 2009, 

up from about 10,500 in 2003, according to the study. 

So the signs are certainly pointing to the right direction. As the 

newly- appointed executive director of the SIA David Cavossa 

Source: State of the Satellite Industry 2003, SIA/Futron. 

Participants of the recently-concluded ISCe 2004 expo shared 

the optimism about the future growth of the satellite industry 

in general and the services sector in particular. . In a trends 

survey conducted by Futron Corporation and ISCe organizer, 

Hannover Fairs USA, Inc. during the show, Sixty-nine 

percent (69%) of respondents anticipate the strongest 

revenue growth in satellite services, followed by ground 

equipment manufacturing (17%) and satellite manufacturing 

(10% of respondents). 

The survey, in which 63% of ISCe delegates participated, 

revealed that he greatest revenue growth in satellite services 

is expected from broadband (39% of respondents), followed 

by direct-to-home television (22%), satellite radio (20%) and 

mobile (15%). Growth in VSAT networks and applications is 

seen as a primary growth area by 5% of survey respondents. 

Driving the growth of the services sector is increased 

government and military spending. This trend is expected to 

continue for the next 3-5 years. 

But the growth in services is coming from various sectors. A 

recent report by the Communications Center revealed that use 

of occasional video services in North America grew by 51% in 

the second quarter of 2004. Occasional use of transponders 

are primarily used for satellite newsgathering, 

teleconferencing, sports and distance education. The report 

also said that while an oversupply of transponders still exists 

in North America, the inventory of unused or inactive C-band 

transponders decreased in the same quarter from 132 to 115, 

and unused or inactive Ku-band supply declined from 113 to 

86. 

According to Northern Sky Research’ study Global 

Assessment of Satellite Demand, within the video services 


SATMAGAZINE.COM

COVER STORY 


18 

said “the strong growth in consumer satellite service revenues 

offset losses in other sectors hindered by overcapacity.” 

reporting to us that business is improving…we project a 

continuation of this promising trend.” 

Capitalizing on the increasing consumer demand for satellite 

services, the Hong Kong-based operator, Asia Satellite 

Telecommunications Holdings (AsiaSat) is reported to be planning 

it’s own DTH pay-TV service for the Hong Kong, Taiwan and 

Macau market. The move into DTH is aimed at boosting its 

transponder utilization rate—which varies from 41% for its 

AsiaSat 2 satellite, 74 percent for its AsiaSat 3S satellite and only 

18 percent for its newest satellite, AsiaSat 4. The DTH service is 

expected to be launched by the end of the year. 

The choice of Asia is obvious. Asia is experiencing phenomenal 

growth in consumer satellite services. The Cable and Satellite 

Broadcasting Association of Asia (CASBAA) estimates that there 

are currently 190 million multichannel households (defined as 

those that receive satellite or cable services) in Asia. 

The encouraging growth figures in satellite services from 2003 

seem to be continuing into 2004. If this holds up in the next few 

years, the industry will be on the full road to recovery. 

As David Hartshorn, secretary general of the GVF, which 

participated in the SIA/Futron study said: “while the satellite 

industry is still fighting it’s way out of the telecom downturn, 

companies from every major region and across each sector—are 

The growth in the satellite services and the ground equipment 

sectors offset the losses in the satellite manufacturing and 

launch sectors, thus enabling the whole industry to post a 

modest growth rate in 2003. If this trend continues, eventually 

the increase in satellite services will lead to a revival of the 

ailing manufacturing and launch sectors. It follows that the 

more transponders are utilized, the more satellites will need to 

be ordered and launched. 

And that’s good for the entire industry. 

SM 

Virgil Labrador is the Managing Editor of 

SatMagazine and Editor of the Daily and 

Weekly editions of Satnews. He has worked 

for the last 16 years in various capacities in the satellite 

industry, most recently as marketing director ofa full-service 

teleport in Singapore then owned by the US broadcasting 

company, CBS. He can be reached at virgil@satnews.com 


SATMAGAZINE.COM

FEATURES 

Narrowcasting: Capturing 

Audiences from space 

CAPTIVATING SHOPPERS AND 

EMPLOYEES WITH MESSAGES 

FROM OUTER SPACE 

Even if it does take your content to 

outer space, as a “one-to-many” 

medium, satellite is the best technology 

available today for the simultaneous 

broadcast distribution of TV and broadband 

content to large numbers of locations, 

be they corporate sites or stores. 

File-based IP delivery of content over 

satellite enables a whole new range of 

advanced broadcast and multicast 

solutions to global corporate and retail 

communications challenges, thanks to the 

protocol’s video file store-and-forward 

applications. 

BUSINESS TV – MEET AT 

YOUR DESKTOP 

By Dan Freyer 


19 

Traditional satellite-based business 

television (BTV) networks are migrating 

from proprietary or MPEG video transmission 

to IP to enable desktop viewing, 

which extends the network to more end 

users and creates new possibilities to 

view content live or on-demand. An 

example: thanks to a satellite IP-to-the 

desktop solution from leading satellite 

service provider GlobeCast, more employees 

of Square D, a unit of global electrical 

supply manufacturer Schneider Electronics 

are plugged in to their company. By 

upgrading Square D’s Business Television 

network to an IP-based platform, 

GlobeCast is helping Square D take 

corporate training and communications 

beyond conference rooms to individual 

workers’ desktops. 

As a result, more employees than 

ever before can catch or cache live video 


Workflow of Captive Audience Retail Trial in UK 

streams of important internal broadcasts. 

Square D’s employees, spread across 117 

sites around the US, will be able to easily 

record and replay missed broadcasts 

because GlobeCast’s solution includes a 

sophisticated video library cataloguing 

system to manage the storage and filebased 

transfer of video programs to 

employee rooms and desktops. Square D 

entrusted GlobeCast — its existing 

network provider — with the job of 

supplying a complete network upgrade to 

IP. As is typical in the case of Enterprise 

customers, SquareD required everything 

from site surveys, to hardware purchase 

and site installation, to ongoing network 

monitoring and maintenance, nationwide 

field support, and broadcast event 

management support including a helpdesk. 

CUSTOMIZING VIDEO NET- 

WORKS WITH IP TECHNOL- 

OGY 

Companies have mainly used 

business television for internal training 

and marketing (new product launches, 

company announcements, etc.). But with 

the advantages that IP technology brings, 

a broader range of enterprise applications 

are gaining a foothold — new services 

which are fully integrated in company 

production, and marketing processes. For 

SATMAGAZINE.COM

FEATURES 


20 

Satellite-Delivered 

Digital Signage Content 

Atracts a UK Shopper 

(Photo Courtesy of 

GlobeCast). 

£12 million in extra space 

or refurbishments in 

order to achieve the same 

sales volume. GlobeCast 

provided the technology 

and transmission 

components for the 

study, including its 

content management and 

file delivery system 

controlled by a webbased 

network management 

and scheduling 

tool. This customer 

interface ensured content 

delivery and scheduling 

across the twenty-two 

Panasonic plasma screen 

network. 

CAPTIVATING 

NEWS 

instance, IP file-based ad-insertion allows 

retailers to create highly targeted Captive 

Audience Networks (CANs) through 

digital signage displays. 

CAPTIVE AUDIENCE NET- 

WORKS 

The U.S. retail industry spends over 

$5 billion annually on printed promotional 

signage and graphics alone according to 

CAP Ventures’ Norman McLeod, who 

says “digital delivery of visual content 

through a network of displays in an outof-home 

setting that is centrally managed 

and controlled,” is the newest advertising 

channel. Springing up at shopping 

malls, airport lounges and retail outlets 

worldwide, Captive Audience Networks 

are set for huge growth according to 

industry observers. Advertisers use 

screen media delivered via satellite to 

target consumers at the point of sale, thus 

providing retailers an effective tool to 

increase turnover and generate revenue 

through media sales. 


What’s the case for CANs? Marketers 

can create greater message impact by 

using full-motion, full-color video and 

adding sound, and marketers can change 

visual messaging faster, more easily, and 

less expensively compared with replacing 

printed signage. What’s more, marketers 

can change the message based on time of 

day, day of week — even the weather, and 

provide regional, local, and even sitespecific 

versioning efficiently and 

inexpensively. The lead-time to launch 

new in store promo campaigns can be 

slashed compared to physical delivery of 

signs or tapes. 

In fact, a recent field study in the UK 

sponsored by GlobeCast and conducted 

by the media strategy firm How and Why 

found that shoppers responded to 

shopping area video screens programmed 

via a satellite CAN and spent more as a 

result. The study estimated that 1.5% lift 

in sales was generated as a result of 

perceived improvements to the retail 

environment. That impact is significant in 

retail. It translates for large a UK shopping 

centre to an investment of around 

IP file transfer technology integrated 

by GlobeCast on a full-time satellite 

network in the US allows one customer to 

deliver its Captive Audience Network 

(CAN) programming as a live stream while 

pushing customer-specific advertising to 

specific sites on the network. The 

company’s Captive Audience Network 

provides retailer and product marketers 

with the opportunity to create new 

revenue streams, improve consumers’ 

shopping experiences, and promote new 

products and services while shortening 

perceived waiting time. 

The company needed a partner to 

build, install and manage a state-of-the-art 

satellite-based network that could deliver 

IP-based live streams and files to thousands 

of retail locations across the US to 

launch its service for corporate public 

display sites, waiting rooms and other 

public dwell spaces. It also wanted a 

flexible partner with the ability to provide 

network design, build out, and deployment 

as a one-stop-shop using small 90 

cm type antennas, and who could help 

them sell or co-sell integration and site 

SATMAGAZINE.COM

FEATURES 


21 

services. With this 

GlobeCast-operated 

Captive Audience Network, 

a retail chain can receive a 

customized version of the 

video network showing 

tailored content during ad 

and other breaks. This 

helps to promote the 

retailers’ products and 

brand around TV programming 

that draws viewers. 

Ads can be replaced across 

an entire retail chain 

network, or addressable at 

individual receive sites. 

Triggers in the IP stream 

cause the receiver hard 

drive to play retailer ads, so 

for example, a 

manufacturer’s ad would 

play in its distributors’ retail 

sites. GlobeCast’s Enterprise 

Group is providing IP encoding, 

satellite transmission and receive site 

installation and management. 

SATELLITE’S ADVANTAGES 

For organizations delivering fullmotion 

video to more than a dozen sites 

— such as CANs, BTV and training 

networks — satellite IP solutions deliver 

advantages over terrestrial webcast 

networking. Network availability is much 

higher and easier to track on satellite. 

Terrestrial webcast solutions, particularly 

if over the public Internet, only provide 

best-effort delivery of packets at each 

Dan Freyer is Marketing Director in America for 

GlobeCast, the world’s leading satellite services company, 

operating a global network of satellite distribution 

platforms for broadcast and advanced content delivery. 

He is President of the Society of Satellite Professionals 

International (SSPI), Southern California. He can be reached at 

Daniel.freyer@globecastna.com. The views in this article are not necessarily 

those of GlobeCast. 


routing point on each route. Satellite 

provides dedicated bandwidth up to full 

broadcast quality video at an economical 

price, while affordable terrestrial solutions 

are limited from 128 Kbps to 1.5 Mbps 

depending on the type of connection 

available at a particular home, field office 

or retail site and the amount of traffic on 

the connection. 

Keven Cahoon, VP of GlobeCast’s 

Enterprise Services Group in America puts 

it this way “If a trainee’s career depends 

on successful training, then Webcasting’s 

Captive Audience 

Networks are Springing up 

in Public Viewing Places 

(Photo Courtesy of 

GlobeCast). 

jerky, grainy video, audio-drop-outs and 

frame-locks are not acceptable. If you 

were the person requiring training to keep 

your job certification and paycheck, 

would you want to rely on poor video 

and intermittent audio of a Webcast? “. 

A similar point applies to CANs says 

Cahoon “If a retail outlet video clip 

display of a new clothing line lacks 

sufficient image clarity, consumer impulse 

buying isn’t likely to result”. 

EARTHLY REWARDS 

To help them leverage the power of 

satellite and IP technology for their 

business, most companies need a satellite 

service and technology partner that 

delivers a total package of reliable, 

responsive service — from network 

design, to site equipment installation and 

maintenance, to network operation and 

support. But at the end of the day, it’s all 

about getting the right content to the 

people that matter at the right time – even 

if it beams through heaven’s gates and 

back to get to there. SM 

SATMAGAZINE.COM

FEATURES 


22 

ArabSat relaunch imminent 

“Time to stop the bleeding” 


Riyadh, Saudi Arabia-based 

ArabSat has made some senior management 

changes ahead of a major relaunch of its services. The 

alterations are more than just cosmetic, although new 

logos, brochures and boosted presence at upcoming 

trade shows are deliberately designed to raise 

ArabSat’s profile dramatically. “We were too sleepy,” 

says Craig Moll, formerly of PanAmSat, and now advising 

ArabSat’s senior management. “We have had 

the benefit of a thorough management consultant’s 

study, and this has given us a fresh baseline for the 

business, and focus, so that we can stop the bleeding.” 

ArabSat also has another pair of reasons to get its 

house in order: Two new satellites, from lead contractor 

Astrium, ArabSat 4A and 4B, the first of which 

comes on stream in Q4/2005, and then Q1/2006. “The 

upshot of these changes is a substantial restructuring, 

and others which will happen during September and 

October. New bodies have been hired, and the logic is 

to plan our marketing campaigns for the rest of this 

year and next.” 

Moll says ArabSat’s brand recognition, while perhaps 

a little tarnished, still has great value in the wider 

Middle East. “But the new look, and marketing effort, 

is but the first step, and we have to translate this into effort on 

fresh customer focus. We want to see a huge leap forward in 

terms of our commercial appeal. The only way we can succeed 

in this to prove it via improved customer service and action.” 

ArabSat has had its engineering problems in the past, not 

least the near-catastrophic failure of its Alcatel-built ArabSat 

3A (at 26 deg East) back in late 2002. This prompted the company 

to take an urgent lease on an older PAS craft, and later a 

large portion of Eutelsat’s ‘old’ HotBird 5 (EuroBird 2) craft, 

now dubbed ArabSat 2D, at 26 deg East. There have even been 

rumours that despite the upcoming pair of new satellites, the 

company is looking to secure additional fleet capacity. It’s also 

likely that once 4A has been deployed, ArabSat will free up a 

satellite to the currently unused 20 deg East slot. Moll says existing 

customers will have the option to move up to the more 

powerful 4A, “but at market rates” says Moll. 


Despite the growth of newcomer NileSat (also looking to 

add a satellite) and the signals that encroach into the Middle 

East from players like Eutelsat, Turksat, AsiaSat and others, 

ArabSat remains the dominant player in its local market. “We 

have more customers, more eyeballs viewing us, and we are the 

only full service company operating in the region. We have a 

good story to tell. We’re waking up; we know we are in a fight. 

We were born in a more gentle time as a means to share resources 

and costs amongst our member states. Today’s game is 

very different and we need to respond to today’s conditions.” 

ArabSat’s move is not a moment too soon. Eutelsat increasingly 

sees the Middle East and Africa as prime hunting ground 

for new business. SES has long sought some sort of action in the 

region, and has made no secret that it would like to acquire a 

bird/slot in the neighbourhood, and should any part of 

PanAmSat’s fleet end up being sold off piecemeal, SES might 

SATMAGAZINE.COM

FEATURES 


23 

“We have had the benefit of a thorough 

management consultant’s study, 

and this has given us a fresh baseline 

for the business...” --Craig Moll, ArabSat 

be in the market to pick up a craft. There’s also the possibility 

of one or other of these players forming a joint-venture or some 

sort of cooperation agreement on a satellite. NileSat has been 

looking for such a scheme to help fund its NileSat 103 craft. 

ArabSat could also now be a willing player in a similar enterprise. 

SM 

London-based Chris Forrester, a well-known broadcasting 

journalist is the Editor for Europe, Middle East and Africa 

for SATMAGAZINE. He reports on all aspects of the 

industry with special emphasis on content, the business 

of television and emerging technologies. He has a unique 

knowledge of the Middle East broadcasting scene, having 

interviewed at length the operational heads of each of the 

main channels and pay-TV platforms. He can be reached 

at chrisforrester@compuserve.com 


SATMAGAZINE.COM

FEATURES 


24 

Building Entrepreneurial Enterprises: 

Lessons from AT&T and Enron 

By Dr. Dean Robb 

More than ever before, sustaining 

success in today’s marketplace 

demands that every company build 

capability for sustainable entrepreneurship. 

Yet this capability seems to be 

extremely elusive. Why? When studied 

from the right perspective, some real 

lessons can be gained from looking into 

the failures of AT&T and Enron. Enron 

saw itself as an entrepreneurial enterprise, 

but it collapsed. AT&T is a very old, 

bureaucratic company that has been 

struggling - with little success - to 

become more entrepreneurial ever since 

divestiture of its local operating companies 

in 1984. 

Each company illustrates a very 

different kind of problem. However, both 

failures can be understood using a simple 

‘model’ of societies and organizations 

developed by anthropologists and 

sociologists (shown below). The model 

also provides some critical insights into 

how to create sustainable entrepreneurial 

enterprises. 

The model is based on: 1) the degree 

to which members of a society or organization 

have a sense of group belonging 

and are interconnected; and 2) the degree 

of diversity, individuality and expression 

that’s acceptable in that society. 

The upper-left zone describes 

societies and organizations with a high 

level of group belonging, but a low 

tolerance for internal diversity, individuality 

or expressive freedom. Such groups 

always form into hierarchies with centralized 

power and control, for the purpose of 

perpetuating an embedded tradition and 


protecting the status quo. In such 

organizations, every action and expression 

must be considered carefully - they 

must be “in synch” with prevailing 

expectations and the culture. There is 

little room for independent action or 

spontaneous expression. This is the zone 

of “keeping up appearances” and the 

“stiff upper lip.” 

Such organizations operate well in 

stable or slowly changing environments, 

but operate poorly in dynamically 

changing environments. And, it is in their 

very nature to stifle the entrepreneurial 

spirit - they can’t help themselves! 

Entrepreneurship requires freedom to 

explore, experiment and openly express. It 

requires internal diversity as a source of 

learning, innovation and growth. And it 

requires ongoing questioning of traditions, 

strategies, values and everything 

else. All of these go deeply against the 

grain of this kind of organization! 

This zone describes AT&T to a tee. 

When divestiture (and the seeds of 

deregulation) began in 1984, AT&T had a 

very long history, a deeply embedded 

tradition, a steeply hierarchical, bureaucratic 

organization, and a rigid monoculture. 

Overcoming this legacy would 

have required a revolutionary, charismatic 

and powerful CEO with a genuinely new 

SATMAGAZINE.COM

FEATURES 


25 

vision and the power to carry it out - 

someone like Jack Welch. Instead, AT&T 

chose Bob Allen, a caretaker/manager 

type - a true son of the tradition - who 

lacked real leadership skills, a compelling 

vision or any sense of innovation. Allen 

led AT&T down the wrong path for quite 

a long time, and eventually into a real nowin 

situation, structurally. They’ve been 

stuck there ever since. 

Enron’s story is different because it 

fits more into the lower-right zone - the 

complete opposite of AT&T. In fact, our 

whole economy fits into this zone right 

now. In this zone, societies and organizations 

are characterized by exaggerated 

individualism, low social cohesion, 

unpredictable changes in markets, and 

constant organizational restructuring, 

downsizing and closings. The rules 

change constantly. Since there is low 

group belonging, people are thrown back 

on their own individual wits and resources. 

Operating in this environment is 

somewhat like living in a chaotic jungle or 

swimming in a pack of sharks. 

This zone breeds charismatic 

personalities, hucksters - and companies - 

that play opportunistic, short-term 

business games with the environment. 

These individuals and companies 

manipulate and exploit emerging, shortterm 

structural or market discontinuities 

to their own advantage. The model is one 

of “thriving on chaos” or “day trading” 

on a huge scale. Enron is a case in point. 

Enron played this game, and played it 

well, for a while. 


But Enron collapsed. Its business 

practices practically guaranteed it. 

Continuously finding and successfully 

exploiting short-term discontinuities and 

opportunities is extraordinarily difficult to 

sustain over any significant period of 

time. This “business model” is fertile 

ground for the growth of unethical 

financial and accounting games necessary 

to paper over the inevitable misreading 

of constantly changing environmental 

“rules.” If a company manages to gain a 

series of big wins, hubris can easily take 

root and get out of control, like a gambler 

who has a string of big wins and begins 

to think that he or she can’t lose. Inevitably 

they do lose, however, and if they bet 

the farm, they go down the tubes. Enron 

is a quintessential example of this 

phenomenon. 

“Thriving on chaos” is a myth. Can 

it be done for a short time? Yes, absolutely. 

Can it yield sustainable business 

growth over the long-term? The odds are 

extremely poor. 

In changing times, the most effective 

strategy for sustainable entrepreneurship 

is to move into the upper-right corner of 

the model by building enterprises that are 

SATMAGAZINE.COM

FEATURES 


26 

highly inclusive, and embrace high levels 

of diversity, individuality and expression. 

This zone is “primed” for high levels of 

organizational experimentation, learning, 

creativity, innovation, change and 

growth. This zone breeds highly innovative, 

entrepreneurial organizations and 

enterprises that can grow relatively 

rapidly, but not chaotically. Such enterprises 

are capable of creating, and 

recreating, internal order within a turbulent 

external environment. It is a zone of 

rapid evolution, not revolution or chaos. 

Here are two reasons why: Embracing 

internal diversity and individuality 

overcomes the conformity and perpetuation 

of the status quo endemic to traditional 

bureaucracies. The other reason is 

more subtle: One of Enron’s key problems 

is that its INTERNAL, social environment 

mirrored the “pool of sharks” dynamic of 

the EXTERNAL environment. Just like the 

external market, 

Enron’s internal world was one of 

individualistic opportunism and exploitation. 

This is a huge mistake. When the 

external environment is fragmented, the 

internal social world of a sustainable 

entrepreneurial enterprise should be 

coordinated and act with an organic, 

focused unity. 

That requires a high sense of 

internal belonging, interconnectedness 

and coherence. 

Our ingrained belief is that it’s 

impossible or unrealistic to build organizations 

with BOTH high belonging AND 

high diversity. This belief system devastates 

all possibilities for creating sustainable 

growth in turbulent times. It’s also a 

defense mechanism. The truth is that it is 

possible to build highly inclusive/diverse 

workplaces. If we are honest with ourselves, 

we will recognize that the real 

problem is that many of us simply are not 

willing to make the transformational 

changes needed to do it. We want to hang 

on to our old ways, but get different 

results. Somebody once told me that this is 

a working definition of insanity! If we can 

get past our resistance, the model provides 

insight into the path forward. 

Enterprises in the “Entrepreneurial 

Zone” have low differentials in power and 

status between the “top” and the “bottom” 

of the organization. In other words, they are 

relatively flat. Traditional command-andcontrol 

practices are replaced by an 

emerging “partnership” model based on 

adult-to-adult (peer) relationships. 

Traditionally, organizational alignment 

is gained through subtle (or not-so-subtle), 

coercive cultural pressures, and through 

extrinsic, social rewards like power and 

status. The goal is behavioral compliance. 

These methods fit firmly into the “AT&T 

zone” - and don’t work anymore. In 

entrepreneurial enterprises, alignment is 

gained by building individual-level, 

authentic commitment. Each enterprise 

member is managed uniquely by tapping 

into individual, intrinsic motivations and 

strengths, and leveraging those for 

Dr. Dean Robb is President of The Resilience Group. For 

over a decade, he has been helping domestic and foreign 

business leaders build high-performing, innovative, 

entrepreneurial enterprises. His expertise combines 

16 years of practical, real-world corporate experience with in-depth doctoral 

research in Human and Organizational Systems. He can be reached at 

drobb@resiliencegroup.com or at (908) 757-4721. 

maximum enterprise advantage. As 

opposed to the bureaucratic “cog in the 

machine” model, employees feel - and act 

- like valued enterprise members. 

The entrepreneurial spirit is “activated” 

by constructively harnessing 

internal variety and differences as the raw 

fuel for continuous experimentation, 

innovation, learning and growth. We 

instinctively resist this because allowing 

internal differences to surface can initially 

seem like a descent into chaos. However, 

while repressing differences might feel 

comfortable and “safe”, it is actually a 

dangerous strategy in a changing world. 

It yields only stagnation, loss of innovation, 

and potential extinction. 

On the other side of perceived chaos 

is a vibrant, dynamic and diverse community 

of employees, each of whom is 

valued as a unique individual and 

encouraged to contribute and create. To 

get there, new leadership and management 

practices are required that foster 

safety, trust, honesty, integrity, accountability, 

mutuality and partnering. 

This calls for a more sophisticated 

level of leadership and management 

competency, wisdom and maturity. This is 

the real reason why creating diverse, 

inclusive enterprises is resisted. It’s hard 

work, and it falls outside of the traditional 

business leadership “comfort zone.” It 

calls upon our leaders to significantly 

“ratchet up” their level of interpersonal, 

relational maturity. Knowing the “business 

side” alone is insufficient to build 

sustainable enterprise entrepreneurship. 

The key to a future of sustainable growth 

lies in combining business acumen with 

community-building skills. SM 


SATMAGAZINE.COM

REGIONAL UPDATE 

PCM thrives in Hong Kong’s 

“Wild East” 



27 

Not so very long ago Hong Kongbased 

broadcast and satellite 

services provider Pacific Century Matrix 

(PCM) was a highly challenged company. 

It suffered from some of the fall-out over 

local media-mogul Richard Li Tzar-kai’s 

bold plans to propel his Pacific Century 

CyberWorks (PCCW) telco into the then 

booming dot-com era. PCCW was backing 

the ambitious Network of the World 

(NOW) concept (along with the late 

sports agent Mark MacCormack and 

London-based TWI), with PCM used for 

the transmission and satellite-delivery of 

the planned bouquet of NOW channels 

and broadband content. Those plans were 

shelved, although NOW continues. 

Today, one television channel is on air 

with licensed service into Mainland 

China, and the NOW Broadband TV 

service, delivered via PCCW’s extensive 

DSL network, is taken by around 300,000 

subscribers within Hong Kong. 


Founded in 

1999 PCM was 

initially a 70/30 

joint venture 

between Pacific 

Century Group 

and Germany’s 

DaimlerChrysler 

Aerospace 

(DASA, which 

later became part 

of EADS). Based 

on NOW’s 

projections, PCM 

once had bullish 

plans to launch its 

own satellites. 

Those plans were 

scrubbed in 2002, 

and under CEO Guenter Kring the 

business refocused into more realistic 

satellite-based broadcast and broadband 

services. 

Scepticism about the likely turnaround 

of the company was abundant, 

admits Kring. With its new focus, PCM 

was also seen by its shareholder EADS to 

be outside its core business. Closure 

might have been an option, but Kring 

emphasizes it was Pacific Century who 

gave the company and his team the 

chance to manage the turn-around. Li’s 

privately held group decided to take over 

EADS’ shares, making PCM a wholly 

owned subsidiary and paving the way to 

recovery. “We were given the chance, we 

picked it up and I believe we delivered the 

first milestone by reaching breakeven. 

Now we are moving on and will deliver 

returns,” says Kring. 

Two years ago PCM had plush 

offices in Hong Kong’s premier business 

district. Today operates out of perfectly 

adequate premises on the Eastern side of 

the island, in industrial Chai Wan. The 

impressive dish farm facilities are on the 

roof, and business is good, despite what 

Kring freely describes as the toughest of 

tough times throughout the region. 

“The region we mainly serve is 

jokingly called the ‘Wild East’. There are 

by and large no rules. But during the past 

two difficult years we have achieved 

positive cash-flow, and are beginning to 

see growth again.” Expansion is now very 

much the order of the day, and part of that 

success is down to AsiaSat. “We have a 

VideoLink Explained 

“Muslim TV is fed from London into Hong Kong via PCM’s VideoLink 

product, which takes a live feed over a managed IP network direct into PCM’s 

Hong Kong facility. “It lets us take our broadcast platform to our customer’s 

doorsteps. The customer can be anywhere in the world. We connect at his 

facility and can handle live broadcast quality delivery up to 180 Mbps of 

bandwidth, using our global managed network. It is simple, cost effective, 

and it works. “ Patrick Yeung, PCM’s SVP Sales and Business Development. 

SATMAGAZINE.COM

REGIONAL UPDATE 


28 

“The services PCM offer 

in their own back yard 

make it easy for us to 

work together. We are 

competitors in some regards, 

but there’s also 

room for us to work together.” 

Darby Sanchez, CEO GlobeCast 

Asia, Singapore 

long-standing relationship with AsiaSat, 

which anyone who is serious about 

accessing the Asia-Pacific market has to 

use. AsiaSat 3S (105.5 deg E) is the 

undoubted hot bird for the region. It’s 

powerful and has a great community of 

some 95m connected households through 

cable and satellite. All the main channels, 

from suppliers like Star TV and Zee are 

present,” says Kring. “We also look at 

AsiaSat 2 (100.5) and SinoSat (110.5). We 

are just now planning a new C-band 

broadcast platform on AsiaSat 2, complete 

with uplink directly from our Chai Wan 

facility. Again a full transponder MCPC 

platform, like the one we have on AsiaSat 

3S. It’s just the best a broadcaster can get 

around here. SinoSat C-band we use for 

satellite-based Internet access.” 

Kring says AsiaSat 2 has excellent 

coverage, and a good neighbourhood, 

almost as good as AsiaSat 3S. “The 

broadcast market is a premium professional 

market, and 3S provides maximum 

value. But 3S was never going to be 

perfect for all customers. It’s marvellous 

for international channels, and those 

broadcasters who recognise and can fully 

utilize the premium value. That still leaves 

others, which for whatever reason prefer 

not to pay or simply do not have the 

budget for pole position but still want 

reasonable coverage for a specific region 

and superior service quality.” 


“We have cases where clients look 

at rather more budget-driven solutions, 

using ThaiCom perhaps. That’s not 

necessarily our market. Others, like the 

Indus TV Network group of channels out 

of Pakistan, are perhaps borderline in that 

they want quality and maximum distribution, 

but are not entirely able yet to 

exploit the full potential of AsiaSat 3S. It’s 

all very well for clients like Indus to be on 

the hot bird, but they still have to get 

people on the ground to tie up cable 

distribution deals to push the channels 

into the mass market, which they are 

doing. We try to help in such cases.” 

With PCM’s support, the Indus TV 

Network has grown from a single channel 

(Indus Vision) launched in 2000 to a 

bouquet of services, now including Indus 

Music, Indus News and lately Indus Plus. 

Another new channel is rumoured for 

launch within weeks. 

Kring says broadcast services on its 

AsiaSat 2 platform benefit from lower 

prices. “The new full-transponder 

platform offers tier 1 quality, at tier 2 price 

levels. We want to make the new platform 

a hot one, like the present one on 3S, only 

in a different customer segment. Our new 

VideoLink network seamlessly connects 

broadcasters worldwide with our satellite 

platforms, turnkey and real-time. That’s 

how we can attract bouquets from abroad, 

like from Europe and from America.” 

The AsiaSat 4 satellite (at 122 deg E) 

is also up and running. “AsiaSat 4 can 

absolutely become a hot bird, but it’s not 

there yet. It has an interesting coverage, 

but not yet the sort of neighbourhood 

that 2 and 3S has. Our focus at PCM is 

very much on our own platforms on 3S 

and the development of AsiaSat 2. A next 

step may be AsiaSat 4.” 

PCM’s Internet and VoIP clients, 

Kring says politely, are not the most 

profitable parts of his business, “but they 

contribute. We are happy to supply and 

support these businesses even though it 

“We have about two years 

of content-rich material in 

our archive, covering movies, 

sport, animation and 

entertainment programming. 

We are going to 

develop our networks with 

PCM, and through them 

target and build to the rest 

of Asia.” 

Ghazanfar Ali, CEO Indus 

Vision, Karachi. 

is a highly volatile sector. It generates 

cost contribution to our overheads.” 

Kring says that some 35% of PCM’s 

revenues come from non-broadcast IP 

based activity. 

One of PCM’s longest-standing 

clients is Bloomberg, and Kring says they 

are typical of major broadcasters, which 

want a highly customised service. “They 

need competitive prices, of course, but a 

rate card is never going to suit a client like 

Bloomberg which frequently needs a raft 

of specialised services,” says Kring. 

“Presently we are taking the existing 

NTSC signal, turning it around and 

converting it into PAL and uplinking it 

onto our 3S platform. They want the most 

perfect pictures, and need a clean sharp 

image with fluid motion of the scroll text 

information.” 

PCM also has a close working 

relationship with GlobeCast, and through 

them has developed a rapport with 

Muslim TV out of London. “They were on 

AsiaSat 2, but they especially wanted to 

reach their viewers on the Fiji islands and 

this meant a shift to 3S.” Muslim TV was 

PCM’s launch customer for its VideoLink 

managed network product. “We did a 

world’s first, really long distance trans 

Continued to page 35 

SATMAGAZINE.COM

VIEWPOINT 

Satellite Services - From Supply 

Push to Demand Pull 

By Bruce Elbert 

President, Application Technology Strategy, Inc. 


29 

The SIA survey 

quoted by Virgil Labrador 

shows the growth and 

dominance of DBS TV 

services over other 

segments of our industry. 

This is as much an 

outgrowth of consumer 

acceptance as it is the 

surplus transponder 

supply at geostationary 

orbit. Getting into the DBS 

business now requires 

investment measured in 

the billions of US dollars, 

while the best slots and 

markets having been taken. Growth of the services segment 

from here would seem to involve applications which either are 

emerging or yet to appear. So, how do we uncover these 

requirements, from where will they come, and with what 

technology may we address them? 

Stepping back, the Internet and Telecom boom 

emboldened many startups and existing operators to invest in 

risky systems with money that seemed plentiful. Now that we 

approach the middle of the first decade of the second millennium, 

satellite operators and service providers are much more 

realistic and far less willing to bet on the come. Instead, we look 

for customers who have quantifiable requirements and the 

financial muscle to back them. I would expect that many large 

organizations in major industry segments outside of telecommunications 

and IT are evaluating new strategies to put themselves 

ahead of competitors. Included here are members of the 

defense segment who already consume large blocks of transponders. 

They and their commercial counterparts are always 

interested in ways to gain control of spending and better 

manage their IT infrastructures. 

In the past, satellite services were reserved for those who 

already understood them. Corporations and government 

agencies which lacked satellite expertise tended to rely on the 

major carriers who, in turn, provided conventional voice and 


data services over landlines. 

Thanks to the aforementioned DBS 

as well as satellite digital audio 

radio service (S-DARS), global 

positioning satellite (GPS) and the 

familiar but unnatural voice quality 

of satellite mobile phones, most of 

the planners and managers of 

broad-based IT have a familiarity 

with satellites. This is good news 

for the services side of the business 

because we can look to the onceunfamiliar 

user for the new demand 

we need. 

Converting such latent 

demand into profitable revenues is a challenge, representing the 

kind of “rain-making” common in the professional services/ 

consulting field. What rain-makers understand is that it takes a lot 

of time and nurturing of relationships to produce the business. 

Good rain-makers have a quality that Joseph Conrad ascribed to 

his fictional Lord Jim, which he called simply “the Ability”. Please 

excuse my abstraction here but I want to make the point that 

creating customers is possible, but comes with person-to-person 

networking as a life-long endeavor. For further reading, see the 

excellent books by Harvey McKay on networking and David 

Maister on rain-making. 

A good approach for uncovering service demand is to heed 

the advice of an IT executive at Kodak, whose name I cannot 

recall but who was a key figure in American industry’s first 

massive IT outsourcing project. He complained that traditional 

vendors provided what fall into the category of “partial solutions”; 

yet what he wanted to see from these companies were 

“solutioneers” who would listen to needs and propose responsive 

systems and technology. 

This all begs the question, “What do companies and 

government agencies really need?” Often, they are no better 

today at verbalizing or communicating what their needs are. 

Worse still, they may put up barriers to this communication that 

prevent us from doing the necessary fact-finding that could result 

SATMAGAZINE.COM

VIEWPOINT 


30 

in a solution. Back we come to the role of the rain-maker with 

“the Ability” to break through barriers, learn what is needed, and 

manage the “solutioneering” process. 

Coming back to the “what” question in the first paragraph 

of this article, I have presented listings in past SatMagazine 

articles of the systems and technologies that have been borne of 

a decade of innovation. For example, MPEG broadcasting gives 

us the ability to distribute multimedia content to remote locations, 

and TDMA the ability to return “solutioneer”. Just 

recently, I received emails from technical staff on different sides 

of the planet at solid organizations - with the simple question, 

“should I use a star network or a mesh network?” They also 

wanted to know how to choose the right equipment to implement 

the architecture. 

This coincidence seems to me to be a symptom of the 

confusion out there among potential users of satellite services 

who know that satellite technology is an answer. However, they 

lack the knowledge to compile their requirements sufficiently to 

conduct trade studies and proceed with implementation. As we 

learn how to communicate with these needy users, we gain “the 

Ability” to create the revenues needed for growth and profit. 

SM 

Bruce Elbert has over 30 years of experience 

in satellite communications and is the 

President of Application Technology Strategy, 

Inc., which assists satellite operators, network 

providers and users in the public and private sectors. He is an 

author and educator in these fields, 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 U.S. and overseas. 

He is the author of The Satellite Communication Applications 

Handbook, second edition (Artech House, 2004). Web site: 

www.applicationstrategy.com / Email: 

bruce@applicationstrategy.com 

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SATMAGAZINE.COM

EXECUTIVE SPOTLIGHT 


31 

Interview with ILC Senior VP & COO Mark Krikorian 

SatMagazine Managing Editor Virgil 

Labrador recently spoke with ILC’s 

Senior Vice-President and COO, Mark 

Krikorian. Atlanta, GA-based satellite 

network monitoring and control company 

ILC has been quietly making waves in 

it’s market sector—posting an average 

growth rate of 40 percent in the last two 

years. Excerpts of the interview: 

Q. Your company used to be known 

as “Industrial Logic Corp.” can you 

briefly explain for the benefit of our 

readers how you evolved from basically 

an industrial company to the more 

focused networks services company that 

you are today? 

A. ILC was originally founded as an 

industrial automation company to 

improve production for mailing envelope 

plants. The objective was to monitor 

factory equipment to stop production 

problems and eliminate raw material waste 

caused by either equipment failures or 

operator error. To address our customers’ 

needs, we created graphical Windows 

based software and hardware that also 

worked as a general monitor and control 

system. Most people new us as ILC, and 

since we have not been in the industrial 

automation market we made the name 

change official. 

Through contacts in the Atlanta area 

we learned that our products had much 

more value in the satellite industry than in 

industrial plants. Our configurable 

software allowed us to demonstrate our 

first prototype satellite earth station 

monitor and control system in less time 

than the existing M&C producers could 

deploy their production version. We 

began selling our new software immediately, 

and have maintained our philosophy 

of ease of use and configurability 

ever since. 


Q. To what do you 

attribute your success in the 

last few years, growing at a 

such a phenomenal rate? 

A. We have increased our 

market share and market size by 

showing our customers how to 

improve revenue and profits by 

using MaxView. We design 

MaxView as a toolset that helps 

our customers supply more 

services with optimum equipment 

and staff while simultaneously 

improving reliability. We 

accomplish this because of the 

two concepts: 

Everyone knows you can 

only fix a problem if you know it 

exists. We were the only 

company in our industry to 

recognize that a monitor and 

control system fails if it cannot 

monitor all devices in the network. To 

address that issue, we created a driver 

development kit that we use to create 

drivers for any type of equipment faster 

than any of our competitors. By doing so, 

MaxView eliminates the blind spots that 

other products produce. MaxView 

monitors and controls networks more 

thoroughly than any other product. 

We believe monitor and control is 

just the beginning of what we do. We 

utilize our products to detect and solve 

ILC Revenues 

(Amounts in thousands) 


network problems and to automate 

network operation. Our customers want 

the freedom to define how to best use 

MaxView to do that. We have taken a 

tools approach to empower our customers 

to set MaxView up themselves, customizing 

the system to solve their problems 

and improve their service. MaxView’s 

graphical point-and-click operation 

enables them to adapt their systems 

without employing software engineers or 

calling ILC. 

Year 2003 2002 2001 2000 

Revenue $9,339 6,574 3,608 4,384 

Percent increase 

(from previous year) 42% 82% -17% 

SATMAGAZINE.COM

EXECUTIVE SPOTLIGHT 


32 

Q. What is your current market 

share? How do you differentiate yourself 

from your competitors? 

A.ILC is the market leader in satellite 

monitor and control. Of the overall 

network control software market, we 

have a market share of less than 1%. 

1. The core difference between 

other network management, monitor 

and control products and MaxView 

is that MaxView interfaces to any 

type of equipment or system, 

regardless of brand or technology. 

That is why customers are able to 

install, customize and expand their 

network control systems from ILC at 

a fraction of the cost and time they 

anticipate. 

2. MaxView builds on total 

equipment control to give our 

customers capabilities that far 

exceed traditional monitor and 

control functionality, including: 

• Network and facilities 

manage 

ment, monitoring and 

control 

• Automated fault management 

and auto-recovery 

• Graphical and browserbased 

remote control 

• Historical and real-time 

report 

generation 

• Event booking, reservation 

and 

resource scheduling 

• Trouble ticketing 

• Service provisioning 

• Alarm correlation 

Q. How much increase in your 

market share are you projecting for 

say, the next three years? How do 

you plan to achieve that? 


A.We expect to increase our market 

share by 150% over the next three years. 

Our expected growth is largely tied to the 

growing trend of converging networks. 

As service providers merge their hybrid 

networks, we are ready with a solution 

that helps them reduce their operating 

expenses by consolidating hybrid 

Continued on page 35... 

SM 

SATMAGAZINE.COM

MARKET INTELLIGENCE 

Satellite Voice over IP: A Market 

for New Links in Africa’s ICT Chain 

By Martin Jarrold, Director, International Programs, GVF 

Across Africa there is an expanding 

awareness of satellite-based Internet 

telephony, a growing realization among 

the telecommunications hungry population 

of the Continent that the “dollars and 

cents” of disposable income go further 

over Voice over Internet Protocol (VoIP). 

Moreover there are now clear signs that 

VoIP services are now looked upon with 

greater favor by a new generation of more 

independent telecoms regulators, in 

distinct contrast to their still recent 

predecessors. 

VoIP is a technology which can 

increase the capacity of telephone 

networks by compressing and routing 

calls for typically 50% of the cost of 

traditional switched services, and it came 

in 2001-02 to be acknowledged as offering 

“carrier-grade” reliability. 

As a growing number of governments 

have recognized that VoIP – rather 

than being a by-pass mechanism which 

presents a major revenue threat to an 

incumbent telco – can help achieve 

essential economic and social development 

goals, this has helped to encourage 

and foster more enlightened regulatory 

frameworks. Thus, VoIP has now been 

legaliszd to some extent even in some of 

the world’s most tightly regulated 

telecommunications markets, such as 

China, India and South Africa. 

In South Africa, according to a major 

new report entitled “Open & Closed 

Skies: Satellite Access in Africa”*, new 

licensees are permitted to deliver VoIP 

from low-density areas, but these had yet 

to be implemented as of end-July 2004. In 

many other countries, VoIP is not clearly 


addressed by regulation, which may 

prohibit new providers of circuit-switched 

but not of packet-switched voice services 

because the latter had not been invented 

or was not taken seriously when the 

relevant laws were written. At the 

beginning of 2004, Mauritius took a lead 

and launched a number of legal, international 

VoIP services, and became the first 

African nation to take this major step and 

establish a precedent for the Continental 

mainland to follow. 

The International Telecommunication 

Union (ITU) estimates that international 

VoIP traffic accounted for 7.3% of 

international outgoing minutes as far back 

as 2001; TeleGeography Inc. in 2002 

estimated that VoIP traffic would double 

during the year, to 18 billion minutes. 

The lower deployment cost of 

packet 

telephone 

lines make 

these services 

especially 

attractive, as 

carriers face 

increased 

competition 

and the need 

to provide 

expanded 

access to 

Information 

and Communications 

Technology 

(ICT) solutions. 

Internet 

telephony has 

been a 

significant 

Figure 1: VoIP with a price-competitive edge. 


Presented by the 

Global VSAT Forum 

SATMAGAZINE.COM 

33 

satellite application since 2000, when 

closed-user-group VSAT networks began 

providing telephone services, with their 

other data traffic. Trunking via satellite 

offers natural advantages to VoIP in 

countries with limited backbone capacity 

where it is sold as a cut-price service, or 

used by new entrants as a way to quickly 

begin providing services. 

In Africa, VoIP also has important 

implications for expanded access to 

services provided in cyber cafés. In a 

proprietors’ survey conducted for “Open 

& Closed Skies: Satellite Access in 

Africa” 1 , 80% of those interviewed in 

Nigeria reported that voice was a growth


34 

MARKET INTELLIGENCE 

area for international 

calls. Call charges using 

traditional networks are 

perceived as too 

expensive, resulting in 

high demand for VoIP. 

For example, at a cyber 

café it costs 20-30 Naira 

(US$0.16-0.23) per 

minute to call a fixed-line 

telephone in the U.S.A. 

The cost of a local fixedline 

call, by contrast, is 

estimated to be 35 Naira 

(US$0.26), see Figure 1. 

The downward pressure 

this is exerting on 

international call rates is 

helping to push the 

incumbent fixed and 

mobile PTOs to reduce 

their rates as well, often 

by adopting the same 

technology. In April 

2004 mobile operator M- 

tel dropped its international call rates to 

50 Naira/minute (US$0.37). 

According to one of the authors of a 

report on the Internet and VoIP services 

across West Africa, grey markets in 

international VoIP calling have grown up 

almost everywhere across the Continent. 

Also citing the example of cyber cafés, 

“African Internet Country Market 

Profiles, Part 1: West Africa” 2 , reports 

that these Internet entrepreneurs can 

offer calls more cheaply than incumbent 

telephone companies and still make a 

profit. In most African countries the grey 

market is estimated to be 10-20 per cent of 

the overall telecommunications market. 

However, in Nigeria – as reported by 

Balancing Act – the CEO of telephone 

incumbent Nitel estimated that before he 

put in place cuts in international calling 

rates, 90 per cent of international calls 

were in the gray market. 

For satellite operators, VoIP is still a 

marginal source of demand for capacity 


but it can be bundled with other applications 

such as distance learning and/or 

can become a source of call-termination 

revenues. 

NOTES 

1 

“Open & Closed Skies: Satellite 

Access in Africa” will be launched at the 

ACT 2004 Summit in Mauritius, 

September 7-10 2004. It was made 

possible through support from the 

International Development Research 

Centre of Canada (IDRC). As part of its 

program of assistance for developing 

countries, IDRC has carried out a Pan- 

Martin Jarrold is the Director, International Programs of 

the Global VSAT Forum. He can be reached at 

martin.jarrold@gvf.org For more information on the GVF 

go to www.gvf.org 

Africa Satellite Survey and selected 

country case studies that provide the 

basis for this report. The report 

supports the Catalysing Access to 

ICTs in Africa (CATIA) programme of 

the U.K. Department for International 

Development (DfID). It draws upon a 

broad base of experts and resources 

in the field of communications, both 

in Africa and throughout the world 

and was prepared by a drafting 

group led jointly by David Hartshorn 

and Mike Jensen. Key contributions 

were made by Geoff Daniell Communications 

Consulting and Stephen 

Esselaar of LinkCentre. The report 

also draws upon recent work 

conducted by the International 

Telecommunication Union’s Study 

Question 17-1: “Satellite regulation 

in developing countries”, the GVF’s 

“Satellite Policy & Regulatory 

Guideline”, a World Bank-funded 

report conducted by DeTeCon 

International for the African Virtual 

University (AVU) on “Low Cost VSAT 

Technologies and Licensing Regimes”, as 

well as legal expertise from Squire, 

Sanders & Dempsey and Coudert 

Brothers, and consulting by Access 

Partnership, COMSYS, DeTeCon, DTT 

Consulting, Euroconsult and Northern 

Sky Research. 

2 

Balancing Act – “African Internet 

Country Market Profiles, Part 1: West 

Africa”. Further details at 

www.balancingact-africa.com SM 

SATMAGAZINE.COM


35 

PCM thrives in Hong 

Kong’s “Wild East” 

Continued from page 28 

portation of full-time live broadcast over a 

managed private network, over 13,000 

miles and across four different networks. 

It’s exciting, and a great advantage for 

quality transport on budget friendly 

terms” added Kring. 

PCM is generally offering TV 

services on a guaranteed bandwidth 

basis, however a StatMux pool is also an 

option. Kring admits there’s plenty of 

price-sensitive competition on his patch. 

“We step back if price expectations are 

simply too foolish. And there have been 

some foolish loss-making prices given by 

others! I do not believe it is worth being 

that desperate. Our customers want good 

prices, of course, and we try to do the 

best we reasonably can. But what point is 

there in selling a high value, high cost 

Mercedes for the price of a Toyota?” 

Kring also points out that if you fall 

into the trap of price-cutting, then word 

quickly gets around. “Peter Jackson [CEO 

at AsiaSat] is the perfect example for 

doing it right. When times were tough he 

resisted the downward slide in prices. His 

satellites have a great value and he has 

maintained that value, on the level, and 

today he is still in business with a highprice 

high-value platform. We might not 

wholly care for the prices, but where is his 

business and his service quality going to 

be if he matches the $500,000 per transponder 

costs that some rivals have been 

charging?” 

Downward price pressures remain, 

“but they’re at a more acceptable level, 

and more manageable today. There is 

more demand so lower rates are compensated 

for by increased demand. But 

caution is also important because of the 

“no rule” rule, where countries don’t 

recognise signed contracts, and contracts 

are often unenforceable anyway, and the 

same applies to debts.” 


China is the region’s great hope, but 

Kring says even here realism is important. 

“AsiaSat has a massive distribution into 

China, especially on AsiaSat 3S, and we 

have high expectations. But billions of 

dollars have gone into China, and we are 

well past the period when everyone was 

rushing blindly into China. Down the road 

it will without any doubt be exceptional, 

but predicting any timeline for this future 

is very difficult. Our China links through 

Pacific Century Group are naturally 

useful.” 

PCM has strengthened its sales 

team by appointing Sean Langston as 

Director of Business Development, and 

another prompt business win from the 

‘Living Asia’ channel, out of the Philippines, 

to be exclusively distributed on 3S 

this October. Others are in the pipeline. 

“Living Asia is but the tip of the iceberg, 

and will prove to be a case-study for the 

way to do things going forward. The goal 

is going to be for us to bring more 

channels out of region into Asia. We’re 

looking at Europe, the US and greater 

Asia, and we can be flexible where it 

makes commercial sense, even to include 

participation in management of the 

channel’s distribution contracts with 

cable operators. A strong, successful 

relationship helps bind both parties 

together.” SM 

Interview with ILC’s 


Continued from page 32 

network operations under one control 

environment. And our current product 

development plan includes new capabilities 

that further our objective of improving 

our customers’ businesses. 

Q. What are the driving forces in 

your segment of the market ? 

A. All our target markets (satellite, 

government, broadcast and telecom) are 

getting pushed to manage larger, converged 

networks with fewer people. At 

the same time the trend toward larger 

converged networks drives the need for 

more comprehensive network control. Our 

approach is to supply one software 

platform that works with all types of 

networks and improves operations 

efficiencies. 

Specifically, we’ve seen a push 

across government agencies towards 

“network-centric operations”, an Information 

Age type of warfare that relies 

heavily on easily adapted, reliable 

networks. While many commercial 

vendors in the satellite industry recently 

began targeting the government for sales 

when the Department of Homeland 

Security was created, ILC began forming 

relationships with the government more 

than four years ago. We did this through 

various channels, including through third 

party integrators with the necessary 

security clearances. This has helped us 

grow our contacts within this market and 

position ourselves as a resource to 

government agencies as they research 

“future-proof” network control methodologies. 

Q. Where do you see the biggest 

growth in your market? 

A. We see the biggest growth in the 

telecom market. 

Q. What’s in store for ILC in the 

next few years? 

A. We foresee continued growth 

with stronger market awareness, allowing 

us to continually improve products 

through consistent investment in research 

and development. This will enable 

us to expand the breadth of our product 

offering, always focusing on network 

control software to detect and solve 

network problems and automate network 

operations. However, we will have some 

surprises for our customers as we extend 

their sphere of control with tools that 

they may not expect a network control 

software company to package in its 

product offering (like this year’s trouble 

ticketing and carrier monitoring releases). 

SM 

SATMAGAZINE.COM

STOCK MONITOR 


36 

Company Symbol Price 52-week Range 

(Sept. 1) 

APT SATELLITE HOLDINGS 

ATS 1.42 1.32 - 3.50 

ANDREW CORP. 

ANDW 11.07 9.30 - 21.67 

ASIASAT SAT 17.75 14.31 - 22.80 

BALL AEROSPACE 

BLL 37.50 25.32 - 37.59 

BOEING BA 52.39 33.66 - 52.82 

BRITISH SKY BROADCASTING 

BSY 34.66 33.22 - 59.24 

CALIFORNIA AMPLIFIER, INC. 

CAMP 5.68 4.05 - 17.20 

COM DEV INTL 

CDV.TO 2.80 1.71 - 3.80 

COMTECH TELECOMMUNICATIONS. CMTL 18.02 14.93 - 39.52 

DIRECTV GROUP 

DTV 15.94 14.70 - 18.81 

ECHOSTAR 

DISH 30.68 26.95 - 41.00 

FREQUENCY ELECTRONICS INC. FEI 11.56 9.52 - 17.13 

GILAT SATELLITE NETWORKS 

GILTF 4.77 3.95 - 9.86 

GLOBECOMM SYSTEMS INC 

GCOM 5.73 3.25 - 7.29 

HARRIS CORPORATION 

HRS 48.95 33.23 - 51.19 

HONEYWELL SPACE SYSTEMS 

HON 36.00 25.94 - 38.46 

INTEGRAL SYSTEMS INC 

ISYS 17.43 15.35 - 22.12 

KVH INDUSTRIES INC 

KVHI 7.80 6.61 - 34.729 

L3 COMMUNICATIONS 

LLL 63.90 41.63 - 66.90 

LOCKHEED MARTIN 

LMT 54.27 43.10 - 55.48 

NEW SKIES SATELLITES 

NSK 7.80 5.20 - 8.16 

NEWS CORP 

NWS 31.14 30.61 - 39.74 

NORSAT INTERNATIONAL INC. 

NSATF.OB 0.54 0.38 - 0.95 

NTL NTLI 54.24 39.99 - 73.81 

ORBITAL SCIENCES CORPORATION ORB 10.77 8.56 - 14.19 

PANAMSAT 

SPOT 23.45 13.80 - 26.01 

PASIFIK SATELIT NUSANTARA 

PSNRY.PK 0.09 0.00 - 0.00 

PEGASUS COMMUNICATIONS 

PGTV 10.11 5.185 - 25.50 

QUALCOMM, INC. 

QCOM 37.99 20.08 - 38.85 

RADYNE COMSTREAM 

RADN 7.06 3.15 - 13.426 

SCIENTIFIC-ATLANTA 

SFA 27.66 25.39 - 38.59 

SIRIUS SATELLITE RADIO INC. 

SIRI 2.27 1.55 - 4.20 

SES GLOBAL 

SDSFa.F 6.80 6.00 - 8.85 

TRIMBLE NAVIGATION 

TRMB 27.11 13.4867 - 29.50 

VIASAT VSAT 20.05 15.30 - 28.91 

XM SATELLITE RADIO 

XMSR 28.00 13.35 - 30.96 

ADVERTISERS' INDEX 

(Click on the page no. to go directly to 

the ad; click on the url address to go to 

website) 

AAE Systems 17 

www.aaesys.com 

Comtech EF Data 18 

www.comtechefdata.com 

DATAPATH Inc. 12 

www.datapath-inc.com 

GLOBAL LINK 6 

www.satnews.com/globallink 

KAVERA 23 

www.kavera.com 

Narda SatelliteNeworks- L3 32 

www.ndsatcom.com 

ND SATCOM 8 

www.ndsatcom.com 

PanAmSat cover & 25 

www.panamsat.com 

Paradise Datacom 15 

www.paradisedata.com 

SES GLOBAL 30 

www.ses-global.com 

For real-time, up-to-the minute stock quotes of satellite companies go to: 

www.satnews.com/free/finance.html 


SATMAGAZINE.COM

September 2004 - SatMagazine

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