Huge order for Iridium spacecraft

An artist's impression of an Iridium Next satellite in orbit An artist's impression of an Iridium Next satellite in orbit

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The mobile satellite services provider Iridium has ordered 81 spacecraft to upgrade its global network.

Thales Alenia Space of France will build the satellites - 66 to form the operational constellation, the remainder to act as spares.

The order makes the Iridium Next venture the biggest commercial space project in the world today.

The $2.1bn deal has largely been underwritten by the French export credit guarantee organisation, Coface.

The overall cost of the Iridium Next project is likely to be about $2.9bn, much of which the company expects to finance out of its own cash flow.

"As you can all imagine, this is a great day for Iridium and the news we announce today represents a significant milestone in the life of our business," said Matt Desch, the chief executive officer of Iridium.

"Iridium has selected Thales Alenia Space to be our prime contractor for Iridium Next, and our agreement constitutes a $2.1bn commitment. We signed an authorisation to proceed yesterday with TAS to immediately begin work designing and building our satellites, and this puts us on track for our first launch of the new satellites in the first quarter of 2015."

Sky flashes

Reynald Seznec, president and CEO of Thales Alenia Space, added: "We were selected for this contract following a long international competition that started back in 2007.

"It is the result of the dedication and commitment of our teams and those of our partners. This success is also a clear recognition of our expertise in system architecture and telecommunications in general, and also confirms our competitiveness and our leadership in the constellation market."

Iridium, which allows subscribers to make a phone call and data connection anywhere in the world, began operating in 1998 but soon ran into financial difficulties.

Iridium spacecraft (Iridium) The current constellation spacecraft have distinctive antennas

It was purchased out of Chapter 11 bankruptcy in 2000 by investors who paid a fraction of the cost of setting up the first constellation.

Today, the company, which is based in McLean, Virginia, has about 360,000 subscribers worldwide, earning revenues amounting to hundreds of millions of dollars. Just under a quarter of those revenues come from US government and Department of Defense contracts.

The Iridium constellation operates in a low-Earth orbit about 780km above the planet. The spacecraft are aligned in six planes and relay communications between themselves and ground stations to provide global coverage.

The distinctive arrangement of the satellites' antennas gives rise to so-called "Iridium flares".

These flashes are produced by sunlight glinting off the spacecraft and are a popular observation for skywatchers.

It was an Iridium satellite that collided with a defunct Russian spacecraft in 2009.

Key finance

The current network consists of 66 satellites. The Next constellation order encompass 81 satellites in total.

TAS will build 66 for operational use, a further six will act as in-orbit spares, and nine spares will be held on the ground.

The Next constellation is expected to work until at least 2030.

Satellite phone competitor Globalstar is already in the process of renewing its network. Globalstar operates 48 spacecraft in a slightly higher orbit and will see its first next-generation platforms launch later this year.

These renewals are also being built by TAS, again in a deal underwritten by Compagnie Francaise d'Assurance pour le Commerce Exterieur (Coface).

TAS beat Lockheed Martin of the US to win the Iridium contract. The support of Coface will have been critical to that outcome.

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