SES (and Boeing) in a mess over O3b
November 1, 2023
The latest batch of O3b satellites, called mPOWER, are all malfunctioning. The problem is in the power supply of the four in orbit and two others due to be launched on November 12th. Manufacturers Boeing is having to supply two additional satellites to compensate SES for the problems.
SES temporary CEO, Ruy Pinto, admitted to analysts that the power problems are worse than originally thought and that the fleet’s expected orbital lifetime will be significantly shorter than planned. SES said on October 31st that the existing orbiting satellites had suffered increasing “non-recoverable” events.
Boeing will do what it can to modify the four in orbit and two launching in November, but the fleet will not now come into service before Q2 2024, perhaps in April – significantly later than initially planned. The delay will take about five per cent of 2024’s revenue expectations.
Boeing, for its part has already taken a write down believed to be about $315 million for the problems. The two extra satellites (numbers 12 and 13 in the fleet) will be provided within the SES Capital Expenditure budget for the complete fleet. Pinto told analysts that SES was in a “risk sharing” agreement with Boeing and this meant at least sharing some of the costs of the problems with Boeing.
While by November SES will have six mPOWER satellites in orbit, the next two (mPOWER 7 and 8) will not now launch until in the second-half of 2024 (and thus some six-nine months later than expected) with 9-11 launching in 2025 and 12 and 13 in 2026. All of these later satellites will have power modifications.
Pinto told analysts that SES had kept its insurers informed and that potential claims could be made for the orbital defects.