Power Problems Force SES to Postpone mPOWER Launch
Nov 27, 2023
Satellite operator SES announced this week that the start of commercial service for its next-generation O3b mPOWER broadband constellation will be delayed until early 2024. The company has been dealing with sporadic power shutdowns on the first four satellites launched earlier this year. To mitigate the setback, SES is upgrading other satellites in the constellation and adding two entirely new ones in a revised deal with manufacturer Boeing.
A visualization of SES’s O3b mPOWER. Credit: SES
SES CEO Ruy Pinto provided the update during the company’s Q3 2023 earnings call. He revealed that the number of temporary power module switch-offs has increased, including some non-recoverable events. This will significantly reduce the lifetime and capacity of the initial four satellites.
To address the situation, SES renegotiated its O3b mPOWER contract with Boeing. The new terms will see satellites seven through eleven upgraded, while two wholly new satellites will join the constellation. Pinto stated that the revised deal enabled both companies to share financial risk as they work towards getting the innovative new technology right.
“It’s important for Boeing and SES that the new technology works flawlessly in space and that we can deploy it with our customers,” said Pinto. “Adding a common objective with Boeing was essential to the negotiation that involved reshaping the contract where both companies took an element of risk in the delivery and the capital expenditure and in adding capabilities to the constellation.”
Specific financial details remain undisclosed. But Pinto suggested SES can deploy the extra satellites without impacting its CapEx spending or reliance on potential insurance payouts for the malfunctioning units already in orbit.
The O3b mPOWER delays follow Boeing taking $315 million in charges last quarter over an unnamed satellite program with technical issues. The aerospace giant’s CFO attributed it to extra work and accommodations for an innovative customer system employing new technologies.
As a result of pushing service to early 2024, SES adjusted its revenue and profit expectations downward for next year. mPOWER was previously slated to launch by the end of 2023. The company estimates a mid-single-digit percentage hit to 2024 top and bottom lines.
The O3b mPOWER system represents SES’s effort to deploy high-throughput and low-latency broadband services around the world. The satellites utilize innovative technologies like digitally channelized bandwidth, steerable beams, and electric propulsion to provide flexible MEO connectivity for enterprise, government, and connectivity services applications. But despite the promise of these capabilities, the early technical problems with the system underline the inherent challenges with pioneering complex orbital networks like these.
While companies like Boeing and SpaceX have extensive experience with rockets, satellites, and other aerospace engineering projects, this does not always guarantee success with cutting-edge systems on first deployment. For SES, Boeing, and other leading players in the space industry, reliably implementing innovations on satellites and bringing them into commercial service remains difficult. The sporadic power module failures show that even minor issues can significantly impact overall satellite lifetime and network performance. As SES works to address these problems, it serves as a reminder across the industry of the persistence required to realize advanced space-based connectivity and develop experience operating it.
