Spacecom and Israel Aerospace Industries Signed a Purchase Agreement for Amos-6 Satellite; Deal Estimated at $195 Million

Published:

November 13, 2012

Updated:

March 21, 2025

Spacecom and Israel Aerospace Industries Signed a Purchase Agreement for Amos-6 Satellite

Israel Aerospace Industries President and Chief Executive Joseph Weiss sat beside Spacecom head David Pollack at Ben Gurion Airport yesterday and signed a single document that binds both companies to deliver, launch, and operate the Amos-6 communications satellite for roughly $195 million. The agreement’s signature ends nine months of negotiation, locks the delivery calendar, and maintains Israel’s ambition to keep national satellites working at the crowded 4° West slot.

Amos-6 will step in for Amos-2 once that older craft retires in 2016 and will share the orbital neighborhood with Amos-3. Customers gain extra bandwidth in Ku, Ka, and S bands and wider geographic reach that links Eastern Europe, the Middle East, and large parts of Africa. Analysts tracking satellite-lease prices call the larger footprint a timely move because high-definition television feeds now chew through capacity far faster than planners once expected.

IAI chose a 5,500-kilogram launch mass paired with a payload rated at 9,000 watts. Electric Hall-effect thrusters trim tank weight and let engineers bolt on more transponders without breaching structural margins. Those savings, plus a lighter bipropellant kick stage, mean Amos-6 can ride to orbit on mid-priced rockets yet still carry 45 channels.

Factory floors in Yehud now host two communication satellites at once: Amos-4 in final integration and Amos-6 at subsystem layout. Line managers say the overlap cuts idle time between projects and protects schedules if a single component shipment goes missing.

Spacecom wrapped a separate $20 million lifetime services deal with the Israeli government. That arrangement secures a fixed beam for civil-security agencies and guarantees a decade of predictable revenue even if commercial demand swings.

Contract fine print sets out firm sticks and carrots:

“Ready to launch” no later than 1 Aug 2015, with a $3 million bonus if IAI delivers early.
Late hand-over triggers up to $10 million in deductions unless the delay arises from launch-provider issues or true force majeure.
Any service life beyond seventeen years returns twenty percent of Spacecom’s extra income to IAI each year.
The payload mixes 39 Ku segments, 24 Ka beams that can steer across Africa or Europe, and two S-band transponders reserved for niche data links.

Spacecom selected a Falcon 9 as the launch vehicle. Executives liked SpaceX’s transparent pricing, a growing flight record, and flexibility on integration dates. Launch insurance sits outside the build contract; Spacecom will float that tender once Amos-6 clears system-level testing.

Pollack framed the satellite as proof that a lean Israeli contractor can outbid larger American and European primes. Weiss, for his part, emphasized that the win secures hundreds of jobs in antennas, power electronics, and flight-software teams who might otherwise drift abroad.

Demand signals back the gamble. European Ku-band slots remain congested, while African Ka-band traffic doubled between 2010 and 2012. Every fresh megahertz sells fast, and customers prefer vendors that already know regional licensing rules.

Technologists highlight a compact list of features baked into the bus:

An aluminum-lithium central cylinder carries two deployable solar wings on either side.
Triple-junction gallium-arsenide cells feed lithium-ion batteries sized for 30,000 cycles.
Eight Hall thrusters provide station-keeping; a bipropellant motor manages orbit-raising.
Digital channelizers divide bandwidth on demand, letting operators shuffle traffic live.
Dual-redundant S-band control links and autonomous safe-mode logic raise confidence against single-event faults.

An onboard processor can reshape coverage zones in minutes. That function lets Spacecom redirect beams toward seasonal sports events or sudden disaster-relief hot spots without waiting for ground-team reprogramming.

IAI pre-bought long-lead hardware – solar substrates, traveling-wave amplifiers, and Ka-band reflectors – before the contract ink dried. Finance officers said the move shields the schedule from currency swings and crowded manufacturing slots at U.S. suppliers.

Spacecom’s 2011 revenue closed at $81 million, up nine percent year on year. Company models foresee double-digit growth once Amos-6 joins the fleet. Bank credit lines cover milestone payments to IAI, while export-credit agencies back imported components.

Local subcontractors share the bounty: Elta delivers the S-band communications suite, Rafael supplies Hall thrusters, and Gilat Satellite Networks provides Ka-band gateway modems. Each firm books multi-year workflow and taps apprentices to broaden the talent base inside Israel’s small space ecosystem.

Government planners also applaud the deal. The Israeli Space Agency wants at least two domestically built satellites running at all times to guard hard-won expertise. Amos-6 keeps that cadence alive and supports future exports by showcasing a high-power bus in daily service.

Work starts under a brisk calendar: critical design review in spring 2013, structural completion before year-end, payload mating in mid-2014, environmental tests that autumn, and shipment to the Cape in spring 2015 for a summer launch slot. Every milestone rolls into the bonus-penalty ledger.

On the competitive front, global builders average $200 million per communication satellite. Thales Alenia, Boeing, and Space Systems Loral chased Amos-6 but lost on total cost and Israel-based industrial share.

Ku-band television remains Spacecom’s mainstay. The company counts 36 million satellite homes across Europe and pitches edge-of-footprint capacity for premium sports feeds. Broadcasters in France and the United Kingdom have expressed interest in multiyear leases that hinge on a 2015 launch.

Ka-band broadband offers fresh upside. Fiber gaps in sub-Saharan Africa leave rural schools and mobile networks hungry for backhaul. Amos-6 will sell wholesale capacity to regional ISPs that bundle terminals and field support.

Potential Ka customers include:

Education ministries funding distance-learning portals
Cellular operators expanding 4G coverage into villages
NGOs that staff short-term clinics during epidemics

S-band channels attract aviation and maritime firms that value high rain-fade margins. IAI carved a narrow gateway beam aimed at secure aeronautical traffic on equatorial routes.

Risk analysis focuses on the electric-propulsion orbit-raise phase. Hall thrusters stretch the trip to geostationary orbit, but IAI offsets that with a high-thrust chemical stage for the first apogee burn. Insurance underwriters demanded a six-month accelerated life test for the thrusters before granting final premiums.

Training plans bring thirty-five engineering graduates onto the project. Mentors from earlier Amos programs guide subsystem leads, ensuring that design knowledge survives retirements.

Spacecom’s board already studies an Amos-7 concept with a 12-kilowatt payload for a tentative 2020–2022 window. No formal request for proposals has surfaced, yet internal teams map requirements in case markets spike again.

The legal framework stays simple: commercial arbitration in Tel Aviv and a standard force-majeure clause for launch-site incidents, export-license delays, or major supplier failure. At end-of-life the satellite will climb to a graveyard orbit using residual xenon, meeting space-debris guidelines.

Summing up, Amos-6 extends Spacecom’s growth streak, anchors Israel’s space know-how, and keeps local subcontractors busy for at least three more years. Execution now turns on clean assembly work and an on-time ride to orbit.

WHAT’S NEW – March 2025 Update

The optimism locked into that 2012 signing never foresaw the blink-and-you-miss-it flash that erased Amos-6 on 1 September 2016. A Falcon 9 engine bay ignited during static-fire at Cape Canaveral, destroying rocket and payload within seconds. Insurance syndicates paid out $205 million, but the crater left a four-year hole in Spacecom’s roadmap.

Coverage had to be restored fast. In early 2017 Spacecom leased AsiaSat-8, flew it west to 4° West, and rebranded the craft as Amos-7. The lease ran $14 million per year yet kept news channels alive. Amos-7 left the slot in March 2025 as planned, handing frequencies back to its Hong Kong owner.

Litigation that followed the explosion proved messy but finite. Arbitration panels ruled in 2018 that IAI’s insurer would transfer $158 million to Spacecom, covering build cost and partial lost income. SpaceX faced no extra liability once investigators blamed a composite over-wrapped pressure vessel for the mishap, a scenario defined as “launch-provider risk” in the contract.

Spacecom pivoted. Management signed Boeing in late 2016 for Amos-17, a tri-band high-throughput satellite now humming at 17° East. The craft launched on a Falcon 9 in August 2019, and its digital payload lets operators swing capacity across Africa within hours. That flexibility partly replaces the lost Ka beams of Amos-6.

Financial scars faded slower than technology gaps. The annual report for 2024 shows revenue climbing to $103 million – still shy of pre-explosion projections yet seven percent higher than 2023. EBITDA margin improved to thirty-six percent once the Amos-7 lease ended.

Spacecom reopened talks with IAI in January 2025 about an Amos-9 platform rated at ten kilowatts. Early sketches call for a fully digital payload, a steerable X-band beam for governmental customers, and a launch no earlier than 2028. Funding hinges on export-credit guarantees and a new anchor-tenant deal with Israel’s Ministry of Communications.

IAI meanwhile took its lessons to heart. Production bays now isolate propulsion modules from avionics racks, and thruster-plasma erosion gets triple the prior test time. The factory’s output covers both Israel’s own Amos-8, ordered in 2021, and small-sat contracts for export customers in Asia.

Insurance markets absorbed the Amos-6 claim by lifting Israeli satellite premiums from four to six percent of declared value. Spacecom’s blended rate for Amos-17 settled near five percent after it added a Tel Aviv-based specialty carrier to the underwriter pool.

Two clear gains grew from the crisis:

Launch diversification – Spacecom now books rides on Falcon 9 and Ariane 6, avoiding a single-provider chokepoint.
Fleet agility – leased satellites act as pop-up coverage while owned assets undergo maintenance or slip schedules.

Government traffic stays solid. Under the original 2012 services framework, ministry data shifted onto Amos-3 and Amos-17 without breaking contract terms. That baseline revenue, about a quarter of Spacecom’s backlog, steadies cash flow while private deals rebound.

Market context changed as well. Eutelsat, SES, and Middle-East rival Arabsat filled some of the Ku-band vacuum left by Amos-6, forcing Spacecom to slash prices on edge-of-footprint leases. Yet digital payload tricks on Amos-17 won back clients who need short-term bandwidth bursts instead of fixed C-band transponders.

Engineers at IAI call the Amos-6 story a “hard lesson in serial redundancy,” and insurers label it the year’s most expensive space loss. For Spacecom, the satellite lives on as a spreadsheet row – both cautionary tale and proof that a mid-tier operator can survive a worst-case hit, learn, and plot the next ride to orbit.

Spacecom and Israel Aerospace Industries Signed a Purchase Agreement for Amos-6 Satellite; Deal Estimated at $195 Million

WHAT’S NEW – March 2025 Update

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