Italy's Alenia Spazio has beaten Lockheed Martin to a contract to build the first two satellites for the Teledesic broadband internet-in-the-sky, Ka-band system.

Teledesic, which is being developed by telecommunications pioneer Craig McCaw and Microsoft's Bill Gates, with investors including Boeing, has scaled down its plans following the collapse of the broadband satellite system market. When originally envisaged in 1997 the system was due to comprise 840 satellites at a cost of $9 billion. It has now been reduced to just 30 spacecraft as a "result of advanced network design", says Teledesic. Alenia's two-satellite deal is seen as an attempt by Teledesic to protect its orbital spectrum, allocated by the Federal Communications Commission, and to win time to assess the system's viability.

The first 12 satellites, costing $1 billion, will provide initial coverage for selected areas, with a further 18 craft to be launched later to provide global coverage. Teledesic has not released technical details or a launch schedule. The company is reported to be in negotiation with other potential contractors to build the further planned satellites.

Plans for a scaled-down Teledesic follow the cancellation and reduction of several other broadband satellite systems, which were announced in the late 1990s amid hyped-up projections. Alcatel shelved development of its Skybridge internet-in-the-sky project last month (Flight International, 8-14 January).

Source: Flight International