content distribution
What prospects for
European sat-radio?
CHRIS FORRESTER reports.
But that’s what Worldspace or
‘1Worldspace’ as we must now describe the
adio tends to be pushed to the company as it re-brands itself, is trying to do,
R
sidelines at IBC. There’s plenty of hampered as it is by some enormous
equipment about, of course, but challenges. First, it has run out of cash. Its
radio simply doesn’t get the senior executives are not drawing salaries,
attention that TV attracts. One expert thinks and the company admits its cashflow is
this is a pity. "There’s a giant industry out extremely tight. Moreover, it was due to hold,
there. They now have a couple of very good on 15 Aug, an extraordinary meeting to
partners, and they have to build on these and approve swapping new shares to the
put fresh cash in place. They've got good company’s debt-holders who are sitting on
people, and in some regards their biggest issue almost $100 million of Worldspace loan notes.
is that they've lots of opportunities. Perhaps regulatory environment has to be sorted out This financial squeeze is important because
too many, given that they're trying to be and that's at least a year away. It is difficult considerable further investment is needed to
active in the Middle East, in Europe, China, for anyone to build a solid business plan with build out national radio repeater networks in
India, South Africa. They are on the right this many unknowns." each country. Worldspace’s plan is to partner
path, and I think they have the ability to raise with local media companies, and the first of
this cash although the climate isn't good right
Speaking about the
these, Class Editori, is already in place in Italy
now." The quote is from Omar Jaffrey, a senior satellite radio sector along with a key contract with Fiat.
analyst at UBS Investment Bank. Jaffrey was
generally, Omar Jaffrey, a
However, the news is not all good,
specifically referring to Washington-based
senior analyst at UBS
especially if Worldspace fails to find new
Worldspace, who intend starting a sat-radio cash. Its two functional satellites are almost
service over Italy next year and have plans for
Investment Bank, says
10 years old, and a third ‘ground spare’ needs
Germany and the UK soon after. that by 2011 the whole upgrading and then launching into space -
Speaking about the satellite radio sector
'sat-radio' industry will
both costly ventures.
generally, he says that by 2011 the whole 'sat-
have expanded: "By 2011
Worldspace also has rivals. Two are
radio' industry will have expanded: "By 2011 especially serious. First up is a joint-venture
mobile entertainment will be a very large
mobile entertainment will
between SES Astra and Eutelsat, called Solaris
market, with giant [media operators] taking be a very large market, Mobile. Delegates to IBC will be able to learn
the sector from an interesting niche to mass-
with giant [media
more from the two backers, but on 18 June
market applications." Jaffrey’s view is that the
operators] taking the
they formally opened their Dublin, Ireland,
car, the RV in North America, and especially
trucks and their drivers, are increasingly the
sector from an interesting
office for Solaris Mobile S-Band
entertainment concept. By this time next year
target of major names like Apple, Microsoft
niche to mass-market
Solaris should be operating a TV and radio
and Google who see the vehicle as a natural
applications." Jaffrey’s
transmission system for mobile devices.
extension of the living room and office.
view is that the car, the
Solaris Mobile CEO Steve Maine, well-known
Jaffrey predicts that by 2011 the US will
have some 34 million subscribers to satellite
RV in North America, and
to the satellite and telecoms community from
his time at British Telecom and more recently
radio, and as this piece is written both XM
especially trucks and their
Kingston Communications, says there are
and Sirius, the two US rivals, are expecting to
drivers, are increasingly
already plans for a follow-on satellite.
be allowed to merge and thus make significant
the target of major names
Maine says that with a scheduled launch of
synergistic savings which will - hopefully -
propel them to profit. Because, good as their
like Apple, Microsoft and
Eutelsat’s W2A craft in February, plus the
usual in-orbit testing, he hoped to see service
business seems, they have yet to make money.
Google who see the
introduction during Q2 next year. Solaris
But while Jaffrey is wholly supportive of sat- vehicle as a natural Mobile is a wholesale service provider, and
radio prospects in the US, he is more cautious
extension of the living
Maine says they are now talking to telcos and
about Europe’s prospect. "It's tough to be
room and office.
media players. "The first clue I would give you
definitive with that degree of uncertainty. The is that we are not talking just to telcos. We
8IBESEPTEMBER/OCTOBER 2008
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