All:
If you haven't noticed, I think this talk of a deal with Intelsat/Inmarsat/Comsat etc. is EXTREMELY important for Loral. It would be a key strategic move, one that could lead to a #1 position in a number of areas. So, in the interest of keeping everyone up to date, here is a Readware post that is relevant, as well an article about privatization of Intelsat:
"No, I do not think that Loral will buy New Skies.
I have read through some of the FCC filings and ITU memoranda regarding the privatization of the Intelsat assets. Extraordinarily "legalese", to say the least.
Ex hypothesi it would make sense in this privatization discussion, one could argue, for LOR to buy (1) Comsat International, (2) ownership in Teleglobe's 3 sats (Teleglobe beams off Orion F1 anyway), (3) transponder access to Intelsat's IOR fleet (or at least ownerships of the slots to 62 and 63 degrees East for their [Loral's] own sats), and the rights to the two slots opening up in Intelsat's AOR.
Ownership in Teleglobe would enhance C* [the Teleglobe sats are ATM efficient], ownership of Comsat Int'l would enhance Orion, as would ownership of the Indian Ocean and Atlantic Ocean region slots of Intelsat.
Will this happen? I think something more than a faint resemblance of what was written above makes economic sense. But it is one of a number of possible scenarios and, as I suggested, hypothetical. As for timing, I think this scenario (or its similitude) would unfold in steps over the next year, and not be something all at once."
and
Bringing Intelsat Back to Earth
The Satellite Group Wants to Privatize and Compete in the Real World
By Mike Mills
Washington Post Staff Writer
Monday, July 20, 1998; Page F05
For Conny Kullman, newly elected head of the global satellite consortium
Intelsat, success will be measured by how soon his job becomes obsolete.
Intelsat, operating from headquarters in Upper Northwest Washington, is
like the United Nations of global telecommunications, except its 143
member nations usually pay their dues on time. Created in 1964 by
international treaty for an era of monopoly telephone companies,
Intelsat has enjoyed -- and been hindered by -- treaty privileges as a
robust competitive industry has grown up around it.
Kullman, a towering, 48-year-old Swede and 15-year Intelsat veteran,
wants to make today's Intelsat disappear by 2001. In its place, he
hopes, will be a completely private, publicly traded satellite company.
And, perhaps, a new, much smaller treaty organization to ensure
satellite service to underdeveloped countries.
"Intelsat needs to be fully commercialized," Kullman said in an
interview at Intelsat's sci-fi-styled building at Connecticut Avenue and
Van Ness Street. "The only way to do that is to privatize this place and
get it into the stock exchange as a private company."
That goal had eluded Intelsat's current director-general and chief
executive, Irving Goldstein, who will retire when Kullman officially
takes over on Oct. 23. Though Goldstein helped to create Intelsat and
its U.S. member company, Comsat Corp., the most he could accomplish in
the way of dismantling was the spinoff in April of five of Intelsat's 25
satellites. Dubbed New Skies Satellite, N.V., the Netherlands-based
company plans an initial public stock offering in about a year.
"I thought I would have been able to get a more complete privatization
done in a shorter period of time," Goldstein said. "I think Conny will
be the last director-general of Intelsat."
Kullman is the first Intelsat career executive to be elected
director-general. The previous four -- including Goldstein, a former
Comsat chief executive -- represented "signatory" nations. Kullman won
in a five-candidate race, with other contenders from Colombia, Norway,
India and South Korea. Being an insider helped Kullman, he and Goldstein
said, because unlike the other candidates, he had never worked for a
signatory, just Intelsat. Member nations felt he could take the most
objective approach to dismantling the organization.
"I felt, through this campaign, that I did have the support of people in
this building," Kullman said. "Unless you have the support of the people
inside, [privatization] would be very hard to do. Some of these things
played in my favor."
Goldstein has tried hard to change Intelsat's image and self-concept
since he took the helm in 1992. Signatories are now called "customers."
Instead of waiting for members to request satellite services from
Intelsat, the group now has sales offices and marketers trying to boost
usage of its network.
Trying to break Intelsat's culture of lifetime employment, Goldstein
shed 120 high-level positions through a generous early retirement
program, helping to reduce the full-time staff from 1,000 to 650.
And some titles have changed: Although Kullman will inherit the
director-general and chief executive titles from Goldstein, what once
were deputy director generals are now vice presidents.
Those changes reflect the new competitive era of satellite
communications. A decade ago, Intelsat controlled most of the world's
transoceanic voice, data and video communications. But undersea fiber
optics have taken away most of Intelsat's telephone business, providing
links that are cheaper, higher-capacity and faster than those
accomplished through high-orbiting satellites.
Video transport now accounts for three-quarters of Intelsat's revenue,
but Hughes Electronics Corp.'s PanAmSat and Loral Corp.'s Orion unit are
eating into that business.
Intelsat used to handle 100 percent of the video signals from events
such as the Olympics and World Cup soccer, for example. But roughly 40
percent of the video from the recent World Cup matches in France came
via competitors' satellites.
Still, an expanding market has helped Intelsat's revenue grow from $550
million in 1992 to a projected $1 billion this year.
Kullman is an engineer who formerly worked for Saab Space AB in Sweden,
designing computer systems for Ariane rockets, experimental satellites
and early direct-to-home broadcasting satellites. He joined Intelsat in
1983, taking on computer and software design responsibilities and later
directing launch operations and research. His most recent position was
vice president for operations and engineering.
Not surprisingly, Intelsat sees the Internet as a primary source of
future growth. Satellites are well-suited for "push" applications, such
as sending large volumes of data to the networks of far-flung corporate
offices.
Kullman won't reveal his thinking on exactly how to carry off Intelsat's
demise as a treaty-based organization. He wants to meet with members and
others in the industry before unveiling a plan. But he said one of his
first priorities will be to remove Intelsat's treaty-based privileges:
It is protected, for example, from being sued for violating antitrust
laws. It also has tax advantages in many member nations.
Those privileges and immunities, Kullman said, have been "more of a
hindrance than a benefit," providing critics with potent fuel for their
arguments that Intelsat plays unfairly in the market.
Intelsat's critics have had success this year in moving legislation in
Congress that would force the immediate privatization of Intelsat by
denying it access to the U.S. market. Intelsat members resent what they
see as strong-arm tactics by Congress, while lawmakers are frustrated at
what they view as Intelsat's member nations trying to hang on to
monopoly protections.
"The legislation has pretty much the same targets as we have ourselves.
. . . Our partners and signatories are all ready to take this next
step," Kullman said. "But legislation that tries to force us to do it
might have the opposite effect."
The satellite industry has had a rough time in Washington lately, as
lawmakers investigate whether Loral and other companies transferred
military secrets to China. An Intelsat satellite was on board when a
Chinese launching rocket exploded in February 1996. Congressional
Republicans say Chinese officials may have retrieved American encryption
devices from the debris, which would have compromised classified U.S.
communications codes.
Kullman said Intelsat is not part of any investigation. "We bought the
launch services from the Chinese. Their rocket failed. And we really
didn't have any active part in what happened after that. We were a
customer," he said.
A customer like any other, not an international treaty organization,
Kullman hopes to be able to say in a few years.
c Copyright 1998 The Washington Post Company
|
