Boeing Pays SES Americom $70-M for Connexion Termination

BETZDORF, Luxembourg, Oct. 4, 2006/Satnews Daily/ — Boeing announced on Tuesday the cessation of commercial operations associated with their satellite broadband service, Connexion by Boeing, effective December 31, 2006.

The company also said it paid $70 million during the third quarter to SES Americom because of its termination of its AMC-23 contract. Of this amount $49 million will be recognized into SES Americom’s revenue in Q3 2006 and the balance of $21 million will be recognized into revenue in Q4 2006.

SES Americom said the unique Ku-band Pacific Ocean Region capacity on AMC-23 is presently being remarketed to a variety of potential customers.

In August, Boeing also terminated services on the AMC-6 satellite.

Boeing Company [NYSE: BA] announced last August its decision to exit the in-flight high-speed broadband communications connectivity markets after six years of work and about $1 billion of losses.

Boeing chairman, president and CEO Jim McNerney said the company estimated it would rake in revenues of $25 billion a year when it launched Connexion. But McNerney admitted his predecessors had overestimated demand.

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