PARIS, 28 December 2004 — Alcatel Space is looking forward to an excellent New Year. In June, Alcatel and Finmeccanica announced that they plan to merge their space activities and form alliances in the space sector through the creation of two sister companies, to which both partners will contribute their respective satellite industrial and service activities. Earlier this month, Alain Catarsi, VP, Europe and South, Alcatel Space, stated that the merger is moving forward as expected and that it is currently awaiting EU authorization.
“We hope that the merger will be official in Quarter 1, 2005,” Catarsi said. “With the merger Alcatel will become the third largest company globally in satellite systems and services after Lockheed and Boeing.”
The first company that will be created through the merger is Alcatel Alenia Space, of which Alcatel will hold approximately 67 percent and Finmeccanica approximately 33 percent, will combine Alcatel Space and Alenia Spazio’s industrial activities. It will concentrate on the design, development and manufacturing of space systems, satellites, equipment, instruments, payloads and associated ground systems. The management team of Alcatel Alenia Space will be located in France. The company will operate through five business divisions — Telecommunications, Optical Observation and Science, Observation Systems and Radar, Navigation, Infrastructure and Transportation. With estimated 2004 sales of 1.8 billion euros and around 7,200 people, it will create the undisputed European leader within the global satellite industry.
The second company, of which Finmeccanica will hold approximately 67 percent and Alcatel approximately 33 percent, will combine Telespazio with Alcatel Space’s operations and services activities. It will concentrate on operations and services for satellite solutions, which includes control and exploitation of space systems as well as value-added services for networking, multimedia and earth observation. Its management team will be located in Italy. With estimated 2004 sales of 350 million euros and around 1,400 people, it will be a key player in the space services market.
The two groups have decided to combine their respective strengths in the space industry to better serve this growing market and to benefit from the expansion of their customer base as well as to leverage the strong complementary nature of the technologies and know-how contributed by both parties. The two groups have identified significant operational synergies and economies of scale, in particular in R&D, product development, procurement policy and increased industrial efficiency. These synergies will improve operating profitability by several points and will be reached progressively, in line with business cycles.
Alcatel is continuing to investigate opportunities to work with other leading technology companies in order to increase its dominance of the space technologies field. Earlier this month, Alcatel Space signed a partnership agreement with GeoConcept SA to provide geopositioning solutions for mobile professional applications. The decision to sign this agreement was based on the two companies’ complementary capabilities. Alcatel Space offers extensive experience and expertise in assisted-GPS positioning technologies, while GeoConcept SA is a leading player in the design and application of geographic information systems (GIS).
Alcatel Space and GeoConcept will develop the following products:
• An assisted-GPS (A-GPS) software receiver, to be integrated in a GSM/GPRS terminal, and a server that can supply A-GPS data on request to GSM/GPRS terminals for Alcatel Space. A-GPS technology provides fast, accurate, reliable and energy-efficient positioning information in demanding environments such as urban “street canyons,” or inside buildings.
• GeoConcept geopositioning application software, enabling users to display their position on a digital map on a terminal, and other geopositioning software enabling the tracking of several terminal positions on a remote server. These software packages are designed for the needs of mobile professionals, with specific interfaces for each user group.
The growth of Alcatel in space technologies bodes well for the Middle East. Alcatel has long been a supplier of satellites and satellite payloads in the region, involved specifically in projects with Nilesat and the Arab Satellite Communications Organization (ARABSAT).
“Alcatel Space has cooperated with ARABSAT for more than 20 years,” said Catarsi. “Thanks to the commercial success of ARABSAT many television channels were created which went a long way to promote Arab culture. We believe that the next step in the ARABSAT story could be an extension of the ARABSAT coverage to catch new audiences and/or markets.”
Currently Alcatel Space is providing the payloads of the fourth-generation ARABSAT 4-A and ARABSAT 4-B satellites for EADS Astrium, the prime contractor for the ARABSAT program. The satellites are planned to enter service in 2006. The two satellites will be co-located at 26 degrees East, with the other ARABSAT satellites. They will be used by the Arab League’s telecommunications organization to expand and optimize capacity for direct TV broadcasting, telephony and data transmissions over a coverage zone encompassing North Africa, the Middle East and part of Western Europe.
ARABSAT 4-A will be fitted with 40 transponders, 24 C-band and 16 Ku-band. ARABSAT 4-B will have 28 transponders, 12 in Ku-band/FSS for Fixed Satellite Services and 16 in Ku-band/BSS for Broadcasting Satellite Services. Both payloads will have about 6 kW of power. Alcatel Space will build the two payloads at its Toulouse plant, then send them to EADS Astrium for integration on the Eurostar E2000+ spacecraft.
Alcatel is looking toward the future requirements of the Middle East and the company is currently working for consensus and funding on a new project dubbed NAVISAT — Air Navigation Satellite System for the Middle East and Africa. NAVISAT aims to improve communication, navigation and surveillance (CNS) of aircraft over Africa and the Middle East. The goals of the project are to enhance air traffic safety, reduce costs associated with aircraft communication, navigation and surveillance, optimize resources, favor tight control of regional air traffic and increase the amount of air traffic in the region. According to Vincenzo Nesci, VP, Alcatel Middle East, the project is already under study by Egypt’s Civil Aviation Authority and within regional groups associated with the International Civil Aviation Organization (ICAO).
In his presentation on NAVISAT, Catarsi stated that NAVISAT’s cost and performance would be more attractive than systems used today. NAVISAT will provide reliable CNS services meeting the recommendations and technical specifications of ICAO. Under NAVISAT there would be the maximum re-use of existing or already planned ground equipment to contain the costs of the system plus there would be an interconnection with existing systems without degradation of quality. NAVISAT could be rented to individual Air Traffic Service (ATS) Providers and for Operational Airline Communications. Alcatel’s preliminary business studies have shown a promising return on investment of 18 percent.
“NAVISAT as of today is based on a two satellite fleet combining a dedicated aeronautical communication mission and a commercial communication mission,” explained Catarsi. “A detailed study, led by Alcatel, has started in order to consolidate the market data and forecast, and consequently validate the concept, the use and the associated business plans. This study includes in particular a large local survey in the 85 covered countries of the NAVISAT system.”
Getting NAVISAT off the ground is extremely complex and the project may become terminally bogged down in committees and regulations.
“For NAVISAT to move forward, we must have all the institutions and regulatory authorities involved agree on the project in principle,” Nesci said. “We need investors as well. Approximately $300 million will be required for the two satellites on which NAVISAT is based. While only one satellite is actually needed for NAVISAT to be operational, a second one must be available as redundancy in a system this essential. It will take 24 months to roll out NAVISAT once the funding is secured. Investors could expect 12-15 years of operation of the satellites after launch.”
Nesci admitted that as of yet, no regional plane crash has been attributed to not having NAVISAT in place. Anyone looking at the growth of regional air traffic however, can easily see that it is only a matter of time before some sort of air disaster takes place due to deficiencies in communication, navigation or surveillance of aircraft over Africa and the Middle East.
Additionally, with the growing usage of information and communication technologies by aircraft manufacturers and the increasing dependency of airlines on those technologies, it is becoming essential that regional air traffic control interfaces effectively with those systems. Authorities in the Middle East and Africa have been considering NAVISAT since 1998 and all the while huge sums have been sunk into building new airports and buying more planes. How many major air disasters will be required in the region to make NAVISAT a reality?
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