O3b, a Google-backed satellite venture that aims to provide Internet services to a population of over 3 billion people, has raised US$1.2 billion from a group of investors and banks, reports the WSJ, enough to see it through to launch in 2013.
O3b is now “fully funded,” Chief Executive Officer Mark Rigolle said, adding that the company may “plan incremental capex in coming years depending on the speed of growth of the business.”
O3b, which stands for the “Other 3 billion”, aims to deliver emerging markets in Latin America, Africa, the Middle East, Asia and Australia. “Fiber is not an option in the Amazon, or in Indonesia with thousands of islands,” said Chief Executive Mark Rigolle.
The satellites have a unique middle earth orbit, around the equatorial arc, four times closer than regular geostationary satellites. Each 700kg satellite will operate in the Ka-band (20/30 GHz), with 12 steerable antennas. Ten steerable beams, with 1.2Gbps per beam, connect to its seven operational regions. Two steerable beams link to O3b’s ground stations that are linked to fiber networks.
O3B will provide cellular carriers with backhaul and providing access to approximately 70 percent of the world’s population. Internet service from O3B should cost about $500 per megabyte per month, down from about $3,000 per MB per month now via existing satellites. O3b system will provide Telcos and ISPs with low-cost backhaul to connect their 3G, WiMAX and fixed-line networks to the rest of the world.
Headquartered in Jersey, the Channel Islands, SES will remain O3b’s largest shareholder following the equity fundraising. New shareholders include Satya Capital, a private equity firm backed by Mo Ibrahim, a Sudanese telecoms tycoon, and the Development Bank of Southern Africa. O3b has finalised a $510m senior debt facility with HSBC, ING, Crédit Agricole and Dexia.
O3b plans to begin commercial service during the first half of 2013 following the launch of the first eight satellites by Arianespace with a Soyuz launcher from French Guiana. O3b was founded by Greg Wyler, a technology entrepreneur. Thales Alenia Space is currently building O3b’s first eight Ka-band satellites. O3b is fully funded for the launch of these, and will generate enough cash to expand its fleet once the service begins, Mr. Rigolle said.
The FT claims O3b has already signed deals worth between US$500 million and US$600 million with customers that want to use the company’s satellite infrastructure. The project needs a minimum of six satellites in orbit, but the intention is to put up perhaps as many as 20 eventually.
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