Investing in Space

SpaceX and European competitor Arianespace win $390 million worth of Intelsat launches

Key Points
  • Intelsat picked SpaceX and its European competitor Arianespace to launch seven satellites in the coming years.
  • The launch contracts are worth a combined $390 million, although Intelsat declined to specify how the money will be split between the two launch companies.
  • The satellites and launches are part of Intelsat's C-band spectrum "transition plan," which was ordered by the FCC earlier this year
SpaceX

Intelsat picked SpaceX and its European competitor Arianespace to launch seven satellites in the coming years, with the contracts worth a combined $390 million.

Under the terms of the contract, beginning in 2022 Intelsat will launch four of its satellites on two SpaceX Falcon 9 rockets and two more satellites on an Ariane 5 rocket. The final seventh satellite is contracted with both SpaceX and Arianespace, as a way for Intelsat to make sure it launches on time. Intelsat will award whichever company doesn't launch the seventh satellite with a contract for a separate later launch, the company told CNBC.

Intelsat declined CNBC's request for comment on how the $390 million will be split among the two launch companies, citing confidentiality agreements.

VIDEO18:0018:00
How SpaceX started and what's next for Elon Musk's Mars dream

Maxar Technologies is building five of the satellites for Intelsat and Northrop Grumman is building the other two.

The satellites and launches are part of Intelsat's C-band spectrum "transition plan," which was ordered by the Federal Communications Commission earlier this year. In essence, the FCC wants to use a range of frequencies for 5G mobile services on the ground that is currently utilized by satellites companies. To do so, the FCC is paying companies to replace satellites – a program that may see Intelsat bring in nearly $5 billion. The clearing payments will also help lighten Intelsat's debt load, which had climbed to almost $15 billion before the company voluntarily filed for Chapter 11 bankruptcy protection in May.

Intelsat plans for the first two launches to take place in the third quarter of 2022, the third in the fourth quarter of 2022, and the final launch in the second half of 2023.

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.