Bankruptcy Dismantles Satellite Partnership Aimed to Connect Alaska

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London-based global satellite broadband company OneWeb, filed for Chapter 11 bankruptcy on March 27, just two months after announcing its new distributor partnership with Pacific Dataport Inc. (PDI), a broadband subsidiary of Microcom.

PDI was founded to bring connectivity to all of Alaska by merging the GEO technology of its Aurora project with OneWeb low-earth orbit (LEO) technology to form unique hybrid and standalone solutions for users across Alaska and the Arctic.

According to the Alaska Journal of Commerce, the partnership was designed to target large customers with Pacific Dataport, selling wholesale broadband capacity on OneWeb’s network. The first Aurora satellite was scheduled to launch late this year with 10 gigabits of broadband capacity, while a second satellite was set for 2022, boosting network capacity to 80 gigabits.  

OneWeb CEO Adrian Steckel said, “Our current situation is a consequence of the economic impact of the COVID-19 crisis. Today is a difficult day for us at OneWeb. Our hope is that this process will allow us to carve a path forward that leads to the completion of our mission, building on the years of effort and the billions of invested capital.”

Chuck Schumann, Founder, EVP and COO of Microcom said funding had been in place and everything was moving forward with PDI’s partnership with OneWeb. “And then, from the COVID crisis, the oil prices and the stock market tanked,” said Schumann, “which caused their financiers, their backers to back out, so they stepped out and left OneWeb hanging.”

Schumann told the Alaska Journal of Commerce the outcome of the economic shutdown caused by COVID-19 and its impact on PDI’s Aurora broadband project are unclear, but they expect delays of at least several months. Alaska’s lack of broadband capacity has been exacerbated by many people being forced to work from home and hold video conference meetings while health care providers are trying to deliver telemedicine during a health crisis.

Alaska is the 46th most connected state in the USA, according to BroadbandNow.com. The lack of broadband capacity is intensifying an already difficult scenario now faced by people forced to work from home.

“Rural Alaska is really hurting for additional capacity, additional connectivity, and there’s just nothing there,” Schumann said.

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