Arianespace Sees Satellites Take Giant Leap into Small Steps

European rocket provider Arianespace SA has notched a new company record for the number of satellite launches in a year, as management continues to stress reliability and slash expenses to compete with lower-cost rivals.

Thursday's uneventful launch of two Galileo navigation satellites for the European Commission from French Guiana was the 12th time an Arianespace-operated rocket successfully blasted a payload into orbit this year. The company's previous record was 11 launches in 2014.

But in an interview earlier this week, company president Stephane Israel stressed that the accelerating operational tempo is only part of a broader strategy to respond to rapidly shifting market conditions. With U.S. and Russian competitors moving to undercut Arianespace's pricing, he said Europe's premier launch company aims to fight back by positioning itself as the most dependable and flexible provider.

To a large extent, the strategy reflects the growing prominence of small earth-observation and broadband satellites weighing hundreds of pounds, and intended to operate at substantially lower orbits around the earth than traditional telecommunications or broadcast satellites weighing several tons.

Arianespace, which built its reputation on boosting big payloads to high orbits, increasingly is tailoring its marketing and mix of launches to optimize handling large numbers of small satellites in a single mission.

It aims to do that with a trio of boosters including Europe's venerable Ariane 5 model, the Italian-designed Vega and Russian-built Soyuz launchers. European government and aerospace industry officials previously agreed to build the Ariane 6, a less-costly and more flexible version of its earlier namesake.

"It's a huge asset for us to have three families of launchers flying,' Mr. Israel said in an interview. "We offer one-stop shopping" for prospective customers.

The Ariane 5 has racked up a string of more than 65 successful launches, providing customers all-important schedule predictability. Optimized to handle large satellites, it is competing against Russian-operated versions of Soyuz launchers that have suffered a series of technical flaws and failures over the years.

Another competitor is Southern California-based Space Exploration Technologies Corp and the heavy-lift variant of its Falcon 9 rocket. The Falcon 9 Heavy isn't scheduled to have its maiden flight until next year.

As a result, Mr. Israel said Arianespace remains careful about reducing prices in this market segment. "We are not considering making dramatic cuts" he said, because the competition consists of "a launcher that has had many failures, and another launcher that has never flown."

SpaceX, as the U.S. company is known, is offering future launches for tens of millions of dollars less than prices Arianespace historically charged. But the closely held company, founded and run by billionaire entrepreneur Elon Musk, hasn't had a successful launch since the spring. In June, one of its unmanned Falcon 9 rockets exploded shortly after blastoff, destroying thousands of pounds of supplies headed for the international space station.

On Thursday, SpaceX officials were in the midst of rocket tests lasting longer than expected, as part of the process of returning to flight with an enhanced, more-powerful Falcon 9 variant. A launch is likely before the end of the year, perhaps as soon as the next few days, according to industry officials.

Arianespace's third rival is United Launch Alliance LLC, a joint venture between Boeing Co. and Lockheed Martin Corp., which is primarily focused on national-security and other U.S. government launches. Mr. Israel said he doesn't consider the venture a strong competitor. When it comes to commercial contracts, United Launch Alliance is likely to follow "an opportunistic approach but with a limited impact," he said.

In the realm of smaller satellites providing Internet access and other services, Arianespace seeks to satisfy rising demand for frequent, reliable launches. Of the company's current roughly $5.3 billion backlog of projects, more than half of all launches will carry satellites to low- or medium-earth orbits.

Arianespace's president said it is difficult to predict exactly how various startups offering Internet connectivity to the Third World will fare, including the OneWorld project backed by British entrepreneur Richard Branson and Qualcomm Inc. The venture has committed to 21 Soyuz launches.

But such ventures "promise to be a new growth engine for Arianespace," Mr. Israel said.

Write to Andy Pasztor at [e-mail]

(END) Dow Jones Newswires

December 18, 2015 00:35 ET (05:35 GMT)

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