UK-based satellite startup O3b says its project to bring internet access to 3bn people in emerging markets is going according to plan and remains focused in 2010 on sticking to its timetable to launch its first eight satellites.

John Finney, O3b’s executive VP of global sales and marketing, told BNamericas that O3b exceeded its internal revenue projections over the past two years, that the satellites are well under development and the company managed to raise start-up capital from global companies.

The company, named after the “other 3bn” people for whom fiber internet access networks are not likely to be commercially viable, is being funded principally by Google (Nasdaq: GOOG), Liberty Global (Nasdaq: LBTYA) and HSBC Principal Investments.

“Our objective for this year is to remain on track to launch our first eight satellites. We’re pleased with the progress we’re making, as the satellites are under development,” Finney said, without providing specific dates for the satellite launches.

In a recent statement, O3b said that based on its current spectrum allocation, initial plans are to have launched 20 satellites by 2015 with long-range capacity of over 90 satellites. However, it said service would be in place by early 2012.

O3b first announced plans in September 2008 to launch satellite-based backhaul based on ultra-low-latency Medium Earth Orbit (MEO) in the Ka-band.

O3b satellites will be placed in orbit 8,000kms from the earth, a quarter of the distance from the planet than regular geostationary satellites, which the company argues will give low enough latency to allow service providers to provide fiber quality internet connectivity but at a fraction of the cost of installing fiber.

CLIENTS

O3b’s target market is satellite resellers, internet service providers, cable operators and mobile network operators who serve the over 150 countries that will fall within O3b’s coverage area, which represents 70% of the global population.

Those customers are building out the last mile infrastructure. The O3b IP trunking terminal is designed for internet backhaul by telecom carriers, operating at rates from 50Mbps to 1Gbps.

“Our offer fundamentally reduces their cost structure for deploying 3G and WiMax networks and enables them to achieve much lower per-megabit costs than current alternatives in the market. This gives them the confidence to go after the lower-earning users because they also get to benefit from a lower cost structure in deploying their networks,” Finney said.

HIGH DEMAND FOR BROADBAND

The O3b project has not been without its critics. Skeptics have commented that similar projects have been proposed over the years, including one backed by Bill Gates, but that literally failed to get off the ground.

Satellite communications for telephony and internet has always been considered expensive, and is marketed mainly to corporations such as mining and energy companies that operate in remote areas. Skeptics have reserved judgment on whether O3b will be able to bring such communication at prices low enough for people in places like Africa and India to afford.

ViaSat (Nasdaq: VSAT) is a major provider of low and medium earth orbit ground equipment for satellites, and it recently signed a US$47mn contract with O3b for the production and installation of Ka-band infrastructure.

Asked about what he thought of the project, John Zlogar, VP and general manager of antenna systems for ViaSat, told BNamericas that he sees the O3b project as “further validation of the need for high capacity satellites, at Ka-band, to meet the continuously increasing demand for broadband data.”

The company also sees potential to work with O3b beyond the initial project and integrate with other projects ViaSat has in residential, enterprise, and mobile broadband, Zlogar said.

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