best launch service

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Best Launch Service Surveyand Analysis

November 2004

Futron Corporation7315 Wisconsin Avenue

Suite 900WBethesdaMD 20814-3202

(301) 913-9372Fax: (301) 913-9475

www.futron.com


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EXECUTIVE SUMMARY

When purchasing launch services, customers balance many factors against contract price,insurance, and other business considerations. These factors typically include vehicle reliability,schedule, performance flexibility, and customer service. This report discusses each of these non-price factors in a launch service decision, and ranks the large GEO-capable launch vehicles

available on the market today in each of these factors.1

Futron Corporation interviewed satellite industry executives from June to August 2004concerning the factors they consider when choosing a launch service. The nine intervieweesrepresented a cross-section of the satellite industry, and included operators and delivery-on-orbitmanufacturers that are responsible for more than half of all GEO commercial payloads launchedsince 2000. During the interviews, we administered a standardized survey asking the respondentshow much importance they placed on each of these factors. For each factor, we asked severalrelated questions to determine what had the most influence on shaping their judgment about alaunch vehicle. Finally, we asked respondents to rate specific vehicles on each of these factors.

Futron identified five major factors that a satellite company weighs when choosing a launch

service provider:

! Reliability! Launch Operations (Schedule)! Performance Flexibility! Extra Costs and Fees (Satellite manufacturer fees and internal costs, later eliminated from the

analysis due to respondents declining to answer)! Customer Service

Futron asked the respondents to rate the following GEO launch vehicles on these five factors:

! Ariane 5

! Atlas V! Delta IV (later eliminated from the analysis due to respondents declining to answer)! Proton! Sea Launch

Survey respondents rated the importance of the five main factors in their buying decision on ascale of 1 to 10, with 1 being not-at-all important, and 10 being extremely important.Respondents also rated elements of each factor to determine which one had the most influence onthese ratings. We then asked the respondents to rate each vehicle on these factors on a scale of 1(extremely poor) to 10 (excellent). Most respondents declined to rate Delta IV because it is notcurrently available commercially, and there have not been enough launches to date to formulatean opinion. These interviews provoked extensive discussion, providing us with a substantial

understanding of the thought process behind their responses.

For independent validation of the survey responses, Futron also conducted a quantitative analysis,which we called the desktop analysis, to rank the vehicles using Futrons database of launchhistory and vehicle attributes. Futrons database contains detailed information on all launches

1 The research underlying this report was sponsored by Lockheed Martin; however, the analysis andconclusions were developed by Futron.


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worldwide since Sputnik, as well as comprehensive information on vehicle characteristics, drawnfrom scores of industry sources.

In the desktop analysis, we performed a quantitative examination of flight history, performancespecifications, and other vehicle attributes, and calculated weighted scores based on theimportance survey respondents gave to elements related to each factor. The results of the survey

and the desktop analysis were combined with equal weight to determine an overall ranking foreach factor. Lastly, we calculated a final score by multiplying the level of importance surveyrespondents gave each factor times the vehicles rank, and totaled them. The lower the score, thehigher the final ranking.

O V E RA L L F I N D I N G S

Atlas V ranked highest overall, ranking first place in three out of the four factors. Proton rankedsecond overall, placing first or second in all but one factor. Ariane 5 and Sea Launch had no firstplace rankings, and equal numbers of second, third, and fourth place rankings. Since the rankingsin each category are weighted according to the importance survey respondents placed on each

factor, Ariane 5 scored slightly ahead of Sea Launch, as shown in Table 1.

Table 1: Overall Vehicle Rankings

FinalRanking

VehicleFinal

WeightedScore

OverallReliability

Rank

OverallLaunch

Ops Rank

OverallPerformance

FlexibilityRank

OverallCustomerServiceRank

1 Atlas V 41.9 1 2 1 1

2 Proton 65.1 2 1 2 3

3 Ariane 5 107.7 3 4 4 2

4Sea

Launch109.0 4 3 2 4

Several elements contributed to Atlass final ranking including its good performance history,simple design, ability to fly a variety of mission profiles, and a high rating for customer service.Ariane 5 and Sea Launch ranked lower due to a higher failure rate and lower perceived reliability,and longer processing times. Also, Ariane 5s dual-manifested mission plan also brought down itsranking.

Vehicle reliability was the most important factor according to survey respondents. Launching onschedule was the second most important factor, while customer service and performanceflexibility were less important overall, as shown in Table 2.


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Table 2: Overall Importance of Four Non-Price Factors in a Vehicle Decision

Order ofImportance

FactorAverage Importance Rating

(out of 10)

1 Reliability 9.3

2 Launch Operations (Schedule) 8.8

3 Customer Service 7.7

4 Performance Flexibility 7.3

Some of the most important observations we made are:

Recent performance history is the most important measure of vehicle reliability, almost to theexclusion of other measures.

Survey respondents overwhelmingly preferred dedicated launches over dual-manifestedlaunches, for both scheduling and performance flexibility.

ILS and Arianespace were rated nearly equal in customer service, with Sea Launch slightlybehind.

In the eyes of launch customers, the best vehicle will have an excellent success record, willconsistently launch on schedule, and will be operated by top-notch technical personnel.

The rankings from the survey and the desktop analysis were consistent overall, reinforcing ourconfidence in the methodology. The main exception was in the reliability rankings, which shiftedbetween the survey and the desktop analysis. Atlas V ranked most reliable in the desktopanalysis, yet Proton was rated most reliable by survey respondents. Although Atlas Vs calculatedsuccess rate is greater than Protons, its limited flight history prevented it from being rankedhigher in the survey. Also, the desktop analysis rated Sea Launch above Proton in performance

flexibility due to its higher lift capacity; in the survey, they were reversed. In launch operations,the desktop and survey rankings were identical.

The Purchasing Factors section describes each of the factors in detail, and compares the surveyand the desktop analyses.

PURCHASING FACTORS

R E L I A B I L I T Y

The confidence in a vehicles ability to deliver a payload to orbit successfully is the mostimportant factor in the launch purchase decision. On average, survey respondents rated theimportance of reliability at 9.3 out of 10. Interviewees rated Proton the most reliable, and Ariane5 the least. A vehicles recent performance history was the most important measure of reliability,rating an average of 9.2 out of 10. The importance of vehicle design elements and theperformance of heritage vehicles were much less important, rating 6.8 and 3.9 respectively. Theonly factor for which the survey differed significantly from the desktop analysis was for


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reliability. Survey respondents rated Proton the most reliable, yet the analysis of past performanceand design elements ranked Proton third.

We asked the participants to rate the importance of three main elements of reliability, on a scaleof 1 to 10, from not-at-all important to extremely important:

! Launch history in the last four years! Launch history in the last ten years or more, including heritage vehicles! Vehicle design elements to enhance reliability

When rating the reliability of the current launch systems, survey respondents sometimes qualifiedtheir answers regarding the newest launch systems, sometimes separating their views of currentand past vehicles. Two respondents declined to rate Atlas V because it was too new, but the sevenwho did rate Atlas V stressed the importance of building a track record before they could solidifyan opinion. Some launch customers stated they wanted to see between three and six successfullaunches of any new vehicle before they would consider buying one. Table 3 shows the averageratings survey respondents gave the current launch systems.

Table 3: Vehicle Reliability Ratings from the Survey

How do you rate the reliability of [vehicle name]?

Survey Rank Vehicle Average Rating (out of 10)

1 Proton 8.8

2 Atlas V 8.3

3 Sea Launch 7.9

4 Ariane 5 6.9

For the desktop analysis, we calculated the percent reliability (successful launches out of totallaunches) for each vehicle and ranked them in order from highest reliability (1) to lowestreliability (4). For the four-year reliability, we examined GEO launches since 2000, and for theten-year-plus reliability, we looked at all launches since 1988, including heritage vehicles. Thisstudy did not undertake a technical analysis of each of the launch vehicles to try to calculatereliability based on vehicle design. Rather, as a measure of design elements, we ranked thevehicles in order of complexity based on the number of engines and the number of stages.Historically, most launch failures are rooted in the propulsion system or in separation events,while only a small portion of failures are related to avionics or other subsystems. Atlas V had thesmallest number of engines and stages, while Proton had the most. Ariane 5 and Sea Launchwere of comparable complexity; Sea Launch has fewer engines than Ariane 5, but has more mainstages. Table 4 shows the desktop rankings for the four vehicles. We combined our desktoprankings of these three reliability measures and weighted them according to the level ofimportance the survey respondents assigned to each to calculate the weighted desktop reliabilityrank, as shown in Table 5.


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Table 4: Desktop Rankings for Reliability

VehicleFour-YearReliability

Rank

Ten-Year-PlusReliability*

Rank

DesignElements Rank

WeightedDesktop

Reliability Rank

Atlas V 1 1 1 1

Proton 2 3 4 3

Ariane 5 3 2 2 2

Sea Launch 4 4 2 4

*The Ten-Year-Plus Reliability calculation includes heritage vehicles. Specifically, the ranking takes intoaccount Atlas II, III, and V flights, all Proton flights, Ariane 4 and Ariane 5 flights, and Zenit-3SL and Zenit-2flights since 1988.

Table 5: Importance of Vehicle Reliability

Survey Question Importance (out of 10)

Overall, how important is a vehicles reliability? 9.3

How important to you is a vehicles performance history in thelast four years?

9.2

How important to you are the vehicles design elements toenhance reliability, such as a low number of parts or redundantsystems?

6.8

How important to you is the performance of heritage vehiclesfrom more than ten years ago?

3.9

By comparing the survey results and the desktop analysis, we reached some important

conclusions about reliability. Perceived reliability is fluid: how reliable a vehicle buyer rates avehicle is based almost entirely on recent performance. Therefore, these rankings represent asnapshot in time, and could easily be reordered in the future. Since the top two causes of launchfailures have historically been rooted in the propulsion system or in separation events, simplervehicles are inherently more reliable. Yet this axiom is the one most at odds with both historicalexperience and customer perception. Ariane 5 was designed to be more reliable than itspredecessors by being more simple. Nevertheless, Ariane 5 failed in early launches. Ariane 4 wasa very complex vehicle, but had 74 consecutive successful launches at the end of its run. Proton isthe most complex of the current launch systems, with four stages and multiple engines. Yet thesurvey respondents ranked Proton most reliable. This reinforces the conclusion that recentperformance history is the most important measure of reliability. Atlas V currently has a perfectsuccess rate, but not enough launches to establish a track record in the minds of launch customers.The second most successful vehicle in the last four years, Proton, then finished first. Many surveyrespondents added they put little faith in designed reliability they really only cared about actualperformance.

Table 6 compares the reliability ranking from the survey and the desktop analysis. We combinedthe two rankings and weighted them equally to determine an overall reliability ranking.


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Table 6: Comparison of Survey and Desktop Reliability Rankings

Vehicle Survey RankWeighted

Desktop Rank

OverallReliability Rank

Atlas V 2 1 1

Proton 1 3 2

Ariane 5 4 2 3

Sea Launch 3 4 4

L A U N C H O PE RA T I O N S ( S CH E D U L E )

Confidence that a vehicle will launch a payload on schedule was the second most important factorto the survey respondents, at 8.8 of 10. Respondents also stated that they strongly preferred adedicated launch over a dual-manifested launch. Nearly all respondents explained they preferreddedicated manifesting due to worries about a delay in the other payload affecting their launch.When asked about what respondents think of schedule assurance through vehicle partnership

arrangements, respondents believed the idea looked nice on paper, but was difficult in execution.Many respondents added they could not think of an occasion where a payload shifted to a partnervehicle in order to stay on schedule. Between the two partnerships (ILS for Atlas and Proton, andthe Alliance for Ariane 5, Sea Launch, and H 2A) respondents rated the Atlas-Proton partnershipas comparatively better since the vehicles are sold by the same company, while the Allianceinvolves competing independent launch companies. When asked how they rate the specificlaunch vehicles at launching on schedule, respondents rated Proton best able to launch onschedule, followed in order by Atlas V, Sea Launch, and Ariane 5. The desktop analysis producedthe same rank ordering.

We identified four major elements of launch operations that influence schedule. For one of thoseelements, whether the launch is dual-manifested or dedicated, we asked people to choose the

statement they agreed with most:

1. I strongly prefer a dedicated launch

2. I somewhat prefer a dedicated launch

3. I have no preference

4. I somewhat prefer a dual-manifested launch

5. I strongly prefer a dual-manifested launch

Respondents overwhelmingly favor a dedicated launch, with six out of nine strongly preferring adedicated launch. No respondent preferred a dual-manifested launch, as shown in Figure 1.


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Figure 1: Dual-or Dedicated-Manifesting Preference for Schedule

When asked what their greatest concern regarding dual-manifesting was, nearly all respondentsexplained that they worry their own program may be delayed by the satellite with which theywere paired. It is understandable that launch customers would be concerned most about factorsbeyond their control, but historically delays in paired payloads have rarely caused delays, usuallybecause alternate payloads were available for pairing. In the current market environment withlower launch rates, finding alternative pairings may become more difficult.

We examined three other elements of launch operations that influence schedule: the launch tempoof the vehicle (frequency of launches), processing time at the launch site, and the possibility ofswitching to another vehicle through a partnership agreement. We asked respondents to rate theimportance of each of these elements on the same 1 to 10 scale, and most respondents placed a

moderate level of importance in each, as shown in Table 7. While launch customers acknowledgethe importance of each of these factors in scheduling, they were more concerned with the overallschedule performance of the vehicle than any particular cause.

Table 7: Importance of Launch Operations and Scheduling


Overall, how important is the ability to launch on schedule? 8.8

How important to you is the launch tempo of the vehicle; that is, thenumber of planned flights in a year?

7.1

How important is it to you for your launch service provider to be ableto offer schedule assurance by making available alternative vehiclesfrom different launch sites?

7.1

How important to you is payload processing time at the launch site? 6.8

In addition to asking respondents how important it was to them to be able to switch to a back-upvehicle, we also asked them how they felt about the vehicle partnership arrangements. Most

0

1

2

3

4

5

6

7

Strongly prefer

dedicated

Somewhat

prefer dedicated

No preference Somewhat

prefer dual

Strongly prefer

dual

NumberofResponses


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respondents said that the ability of ILS to switch between Atlas and Proton vehicles was betterthan that of the Arianespace-Sea Launch-H 2A Alliance since ILS is one organization whileArianespace and Sea Launch are two separate companies, and H 2A has not flown commercially.Yet while six out of nine respondents preferred ILS in this regard, they explained that switchingvehicles is difficult in practice and involves extra cost, suggesting that both organizations havework to do in creating a backup offering that addresses all customer needs. Two respondents said

that the Alliance and ILS are the same, while one respondent did not know enough about theAlliance to offer an opinion.

Figure 2 shows how respondents compared schedule assurance offerings from both partnerships.

Figure 2: Schedule Assurance Offerings of ILS vs. Alliance

Between ILS and the Alliance [Ariane 5, Sea Launch, and H 2A], which one offers the best overall ability

to launch on schedule?

Respondents were asked to rate the ability of the various launch vehicles to launch on schedule ona scale of 1 to 10, with 1 being extremely poor and 10 being excellent. Proton was rated highest,followed closely by Atlas V. Sea Launch was rated third, while Ariane 5 received the lowestrating, as shown in Table 8.

Table 8: Survey Rank of Vehicles Ability to Launch on Schedule

How do you rate the ability of [vehicle name] to launch on schedule?


1 Proton 8.22 Atlas V 8.1

3 Sea Launch 7.2

4 Ariane 5 6.6

In our desktop analysis of launch operations, we ranked each vehicle in order from the best abilityto launch on schedule (1) to the least (4). We ranked each vehicle on the same four elements oflaunch operations that the survey respondents addressed: launch tempo, payload processing,vehicle partnerships, and single or dual-manifesting. We then weighted each factor according to

0

1

2

3

4

5

6

7

ILS Alliance Don't know

enough about

Alliance

Don't know

enough about

ILS

Are the same

NumberofResponsess


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the level of importance the survey participants assigned to them (Table 7) to determine ourweighted desktop rank.

For launch tempo, we compared the maximum number of launches in 60 days, and the minimumtime between launches for each vehicle. For ranking vehicles according to best processing timesat the launch site, we compared measures for both the nominal campaign length and bottlenecks

in the processing sequences, based on the payload planners guides as published by the launchcompanies. These bottlenecks included the number of fueling stations and encapsulation baysavailable for simultaneous processing. While each vehicle had advantages and disadvantages inthese regards, our processing time ranking was Atlas V, Proton, Ariane 5, and Sea Launch. Sincemost respondents overwhelmingly preferred dedicated launches, Ariane 5s rating suffered by thefact that dual launches are the standard product offering. And since schedule assurance frombackup vehicles was rated slightly higher for ILS, this favored Atlas and Proton. The desktopsummary is shown in Table 9.

Table 9: Desktop Rankings for Launch Operations (Schedule)

VehicleLaunchTempoRank

PayloadProcessingTime Rank

VehiclePartnership

Rank

Dedicated-

vs. Dual-Manifesting

Rank

Weighted

DesktopLaunch Ops

Rank

Atlas V 3 1 1 1 2

Proton 1 2 1 1 1

Ariane 5 2 3 3 4 4

SeaLaunch

4 4 3 1 3

Protons history of handling a high launch rate in a short period of time helped the most towardsits first place ranking even though it did have some bottlenecks in payload processing. Ariane 5sdual-manifesting and low historical launch tempo combined to give it a fourth-place ranking. Theranking for the desktop analysis exactly matched the ranking from the survey. Therefore, theoverall launch operations Ranking was also the same, as shown in Table 10.

Table 10: Comparison of Survey and Desktop Launch Operations (Schedule) Rankings

Vehicle Survey RankWeighted

Desktop Rank

Overall LaunchOps Rank

Atlas V 2 2 2

Proton 1 1 1Ariane 5 4 4 4

Sea Launch 3 3 3


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C U S T O M E R S E R V I C E

Customer service ranked third in overall importance, at 7.7 out of 10. By far the most importantfactor in customer service was the quality of the relationship with the technical personnel, at 9.0out of 10. Respondents said they want to have confidence in the quality of the technical team, and

look for good communication about the progress of their program throughout the buildup tolaunch. Respondents placed equal weight on the quality of the relationship with the contractnegotiation team and the experience at the launch site at 8.3 out of 10. When asked to rate thevarious launch companies on customer service, the ILS and Arianespace vehicles were rankedvery closely. Respondents who gave Sea Launch a slightly lower rating said they did so onlybecause they have not had enough experience with the organization to formulate an opinion.Since Sea Launch has the smallest market share of the rated launch providers, it is consistent thatsatellite companies have less experience buying launches from the company.

The survey responses rating the importance of the three elements of customer service are shownin Table 11.

Table 11: Importance of Elements of Customer Service

Element of Customer ServiceImportance

(out of 10)

Overall, how important is customer service? 7.7

When choosing a launch vehicle, how important to you is the ease of workingwith technical representatives?

9.0

How important to you is the ease of working with contract negotiationrepresentatives?

8.3

When choosing a launch vehicle, how important to you is the experience atthe launch site, including the ease of working with representatives from theservice provider, accommodations, and hospitality?

8.3

We asked respondents to rate the three launch service providers on their technical and contractnegotiation representatives. Since we asked these questions by launch company, we used thesame responses for Atlas and Proton. For the question on the experience at the launch site, weasked survey respondents to rate the experience for each vehicle, as shown in Table 12. Arianeand Atlas were ranked best on launch site experience, with Proton slightly behind due to itsKazakhstan launch site, and Sea Launch ranked last.


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Table 12: Customer Service Ratings and Vehicle Ranking

Vehicle

TechnicalRepresentatives

Rating

ContractNegotiation

RepresentativesRating

Experience at theLaunch Site

Rating

Weighted

CustomerServiceRank

Atlas V 8.3 7.7 8.3 1Proton 8.3 7.7 7.4 3

Ariane 5 8.1 7.8 8.4 2

Sea Launch 7.5 6.9 6.8 4

How do you rate the technical representatives from [launch provider name]?*How do you rate the negotiation representatives from [launch provider name]?*How do you rate the experience at the launch site for (vehicle name]?

*Same value used for both Atlas and Proton

We did not perform a desktop analysis for customer service since it is an inherently subjectivefactor. Instead, we weighted the ratings survey respondents gave for each vehicle according to the

importance the respondents gave to each element of customer service. All four vehicles scoredvery closely, with Atlas V rated best following in order by Ariane 5, Proton, and Sea Launch.

P ER F OR M A N C E F L E X I B I L I T Y

Performance flexibility in this study means the ability to customize mission profiles to maximizeservice life on orbit, or to fly to unique orbits. This factor was fourth in importance according tothe survey, rating 7.3 out of 10. Respondents preferred dedicated launches over dual-manifestedlaunches for mission flexibility, although the preference was slightly less strong compared to howthey thought dual or dedicated launches affect schedule. All vehicles surveyed can fly customizedmission profiles except for dual-manifested launches that fly to standard geostationary transferorbits (GTO). Atlas V ranked highest for performance flexibility in the survey at 8.9 out of 10,and Ariane 5 ranked fourth at 7.4. A vehicles ability to accommodate growth in payload masswas the most important element of performance flexibility, at 7.8 out of 10. At the same time,some respondents rated growth in payload mass of low importance, saying they usually buystandard satellite buses, where final spacecraft mass is more certain. There was little interest inflying direct-to-geostationary missions, rating only 5.1 out of 10.

We asked survey respondents to consider four elements of performance flexibility:

! The ability to accommodate growth in payload mass! The ability to optimize orbital insertion! The desirability of flying directly to GSO! Preference for dedicated or dual-manifested launches

Table 13 shows the level of importance respondents attributed to the first three of these elements.


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Table 13: Importance of Performance Flexibility


Overall, how important is a vehicles performance flexibility? 7.3

How important to you is a vehicles ability to accommodate growth inpayload mass?

7.8

How important to you is optimizing orbital insertion, such as theability to fly a supersynchronous mission, high-perigee missions, orother profiles to minimize delta-V to GSO?

7.2

How interested are you in the ability of launch vehicles to providedirect-to-GSO missions?

5.1

To determine how dual-manifesting affects performance flexibility, we asked respondents tochoose the statement regarding dedicated or dual-manifested launches just as we had doneconcerning scheduling. Respondents still expressed a strong preference for dedicated launches,

but only slightly less so concerning performance flexibility. Two respondents expressed nopreference, while only one respondent had no preference when considering the effect onschedule, as shown in Figure 3.

Figure 3: Dual- or Dedicated-Manifesting Preference for Performance Flexibility

We asked survey participants to rate the performance flexibility of each of the vehicles on a scale

of 1 to 10, with 1 being extremely poor and 10 being excellent, as shown in Table 14. Since dual-manifested Ariane 5 launches fly only to standard orbits, respondents gave the vehicle the lowestrating of the four vehicles, at 7.4.

0

1

2

3

4

5

6

7

Strongly prefer

dedicated

Somewhat

prefer dedicated

No preference Somewhat

prefer dual

Strongly prefer

dual

Numberof

Responses


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Table 14: Performance Flexibility Ratings

How do you rate the performance flexibility of [vehicle name]?


1 Atlas V 8.9

2 Proton 7.93 Sea Launch 7.6

4 Ariane 5 7.4

For the desktop analysis, the most limiting factor for performance flexibility was a dual-manifested launch because dual-manifesting places a payload in a standard orbit, with noopportunity to customize the launch profile. Since each dedicated launch vehicle can fly a varietyof flight profiles and could fly directly to GSO with multiple firings, Atlas, Proton, and SeaLaunch received the same ranking above Ariane 5. In order to create a ranking for the ability tohandle growth in payload mass, we ranked each vehicle in order from largest GTO capability tosmallest. We then calculated a performance flexibility desktop ranking for the vehicles byweighting each element according to the importance given to it in the survey, as shown in Table

15. Atlas V, Sea Launch, and Proton rated in order of largest to smallest GTO lift capacity, whileAriane 5 ranked fourth due to the inflexibility of launching to standard orbits.

Table 15: Desktop Rankings for Performance Flexibility

Vehicle

Growth inPayload

MassRanking

CustomizableOrbit

InsertionRanking

Direct-to-GSO

CapabilityRanking

Dual- orDedicated-Manifestingas Standard

Ranking

Weighted

PerformanceFlexibility

Rank

Atlas V 2 1 1 1 1

Proton 4 1 1 1 3

Ariane 5 1 4 4 4 4

Sea Launch 3 1 1 1 2

The survey and desktop analyses largely agreed, except for a switch in the second and third placevehicles. The desktop analysis ranked Sea Launch ahead of Proton based on Sea Launchs greaterlift capacity, and therefore better ability to handle a growth in payload mass. When combining thetwo analyses, Atlas V and Ariane 5 retain their first and fourth place rankings respectively, whileSea Launch and Proton tie for second, as shown in Table 16.

Table 16: Comparison of Survey and Desktop Performance Flexibility Rankings

Vehicle Survey Rank

Weighted

Desktop Rank

OverallPerformance

Flexibility Rank

Atlas V 1 1 1

Proton 2 3 2

Ariane 5 4 4 4

Sea Launch 3 2 2


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E X T R A C O S T S A N D F E E S

Satellite manufacturers sometimes differentiate the costs they charge for supporting a launch ondifferent launch vehicles. We wanted to determine whether the cost differential among the

various vehicles was an important factor when choosing a launch vehicle.

We asked respondents to quantify the costs paid to satellite manufacturers and the costs satellitecompanies incur internally to support launches at the various sites. Respondents indicated thatsatellite manufacturer charges were generally less than $2 million per mission, but were notforthcoming in providing the differences between vehicles. Some respondents also said that theircontracts typically do not break down these costs and that they consider them in the noise.Consequently, respondents rated this factor the least important of all the factors in the launchvehicle decision, at 5.7 out of 10. Since respondents did not provide a sufficient sample offigures, we dropped extra costs and fees from the overall analysis.

CONCLUSIONSWhen procuring a launch service, customers weigh several factors regarding the quality of thelaunch service against price, insurance, and other business considerations. The survey revealedvehicle reliability was the most important of these factors. When assessing a vehicles reliability,launch customers consider recent performance history the most important measure, almost to theexclusion of other measures such as design simplicity or the performance of heritage vehicles.Additional comments from the survey respondents revealed that customers look for stability invehicle design and prefer to buy vehicles that are as close as possible to those flown on previoussuccessful flights with a minimum of modifications. Atlas V currently has a perfect flight recordto date, but it has not built a sufficient track record to earn more than a second place rating fromsurvey respondents. Early failures of Ariane 5 gave the vehicle its fourth place ranking forperceived reliability. Since perceived reliability is based mostly on recent flight history, customer

ratings are volatile. A string of successful flights or launch failures could substantially reorderthese rankings at a future date.

After a successful launch, deploying on schedule is the next most important factor to customers.Launch customers strongly prefer dedicated launches over dual-manifested flights because theyare concerned that a delay for their co-passenger will mean a delay for their own program. Whenassessing the ability to launch on schedule, customers examine potential bottlenecks in payloadprocessing and consider the actual performance history of a vehicle. Proton rated highest in theability to launch on schedule, due to successfully demonstrating a robust launch tempo, despitesome bottlenecks in the payload processing sequence. While the current launch providersparticipate in vehicle partnerships to make an alternate vehicle available in the event of a delay,launch customers do not feel these arrangements currently provide a real benefit to schedule

assurance. To be effective, these arrangements would have to be of little or no added cost to thecustomer and build a demonstrated record of working efficiently. Between ILS and the Allianceof Ariane, Sea Launch, and H 2A vehicles, launch customers gave a comparatively higher ratingto ILS since the Atlas and Proton partnership is under one organization.

Customer service ranked third in importance, yet having a good relationship with a qualitytechnical team is crucial to a launch customer. They want to feel confident their satellite is in thehands of top-quality technicians who will keep them informed of the progress of launch


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preparations. ILS, Sea Launch, and Arianespace ranked very closely in customer service, withAtlas V ranking highest due to a high confidence in the technical team among surveyrespondents. Ariane 5 was slightly behind in second place, and Proton rated third mostly due itsremote Kazakhstan launch site. Sea Launch rated fourth, mostly because several surveyrespondents did not have much experience working with Sea Launch, yet gave the company onlyslightly lower ratings. Respondents also added that experience is the most important factor

influencing their perception of customer service, suggesting this factors rankings are fluid andcould shift over time.

Performance flexibility is the least important of the factors analyzed. Flying dual-manifestedlaunches to standard orbits is the most limiting element of performance flexibility. Yet whenweighed against other factors, many customers still will buy dual-manifested launches. Theability to accommodate growth in payload mass is important to customers that buy new satellitebuses or highly customized satellites, but it is less of a concern for customers who buy standardsatellite buses, where final spacecraft mass in known with greater certainty. Customers see littleadvantage of flying directly to GSO with multiple upper-stage firings, and generally prefer usingspacecraft propulsion to achieve final orbit. Atlas V ranked highest in flexibility, followed byProton and Sea Launch. Ariane 5 was deemed least flexible due to dual-manifesting.

According to the survey of satellite industry executives and a quantitative analysis of the factorsconsidered most important in the vehicle buying decision, Atlas V currently ranks highest amongthe commercial large vehicles for launching geostationary satellites. Proton ranks second overall,with Ariane 5 and Sea Launch following in a near tie, as summarized in Table 17. The factorsmost likely to influence these rankings in the future are the degree to which each vehicle launchessuccessfully and on time, and how well the launch providers keep a reputation for maintaining ahigh-quality technical workforce.

Table 17: Overall Vehicle Rankings

FinalRanking

Vehicle

Final

WeightedScore

Overall

ReliabilityRank

Overall

LaunchOps Rank

Overall

PerformanceFlexibility

Rank

Weighted

CustomerServiceRank

1 Atlas V 41.9 1 2 1 1

2 Proton 65.1 2 1 2 3

3 Ariane 5 107.7 3 4 4 2

4Sea

Launch109.0 4 3 2 4


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researching, analyzing, and forecasting space and telecommunications markets and programs.Futron offers our commercial and government clients a suite of proprietary, leading-edge analyticmethodologies. Our world-class team of market and policy analysts, economists, and engineersbring unparalleled skills and expertise to each account.

We have surveyed hundreds of aerospace firms to develop a unique revenue, employment,and productivity profile of the industry.

We have developed country-by-country models of demand for telecommunication servicesthat aggregate a global forecast up from the individual household PC or business network;these models have accurately predicted future launch levels and business changes in thesatellite industry.

Futron helps clients win competitions, analyze competitors, estimate costs and prices, andtrack opportunities.

Futron also performs cost estimates and economic analyses. Futron generates bottoms up,parametric, and analogous cost estimates for commercial satellite and launch vehicleprograms.

Futron provides a subscription-based service providing information on every FCC satelliteapplication filed since 1990. Futrons FCCFilings.com is the only source for competitiveintelligence and business data contained in FCC satellite licensing documents.

This report is a product of Futron Corporation. Any portion of this report may be reproduced aslong as Futron is referenced as the source.

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