ShinSat's share price closed at Bt7.20 yesterday, down from Bt7.45 on Friday.

Executive chairman Dumrong Kasemset said the development would not affect the company's projected revenue this year, as it has yet to include Thaicom 3 income from the Middle East into the calculation.

Thaicom 3 was just beginning to look for customers in the Middle East before the power loss took place, he said during a teleconference with the press on the incident yesterday.

ShinSat moved Thaicom 3 at 1.37am yesterday because the power loss was such that the satellite could not provide further service. It did so by moving it beyond its orbital slot of 50.5 degrees East.

Dumrong maintained that the incident would not hurt the company's image, saying that it had solved the problem on a professional basis.

"We're investigating the real cause of the problem for the insurance claim," Dumrong said, adding that the insurance coverage is about 10 per cent of the satellite's value.

Thaicom 3, worth about US$50 million (Bt1.8 billion), is a Spacebus 3000A model built by Alcatel Alenia Space of France. Launched in 1997, it suffered a first technical glitch in the power supply in February 2003, which prompted a reduction of its life expectancy to 10 years from the original 14.

ShinSat was paid about $32 million of insurance following the incident.

After that, ShinSat developed the broadcasting Thaicom 5 satellite and launched it in May to replace Thaicom 3 at 78.5 degrees East, and transferred customers from Thaicom 3 to Thaicom 5.

The customer transfer process was finished in July, before ShinSat moved Thaicom 3 from its original location to 50.5 degrees East to tap the Middle East market. Therefore the decision to move Thaicom 3 has no effect on former Thaicom 3 customers, Dumrong said.

Dumrong said the company still had the right to use the 50.5 degrees East orbital slot, which belongs to the Thai government, but it is too early to reveal a back-up plan and the company still has time to make a decision.

"There are many scenarios. We may seek collaboration with another satellite to provide the service in the Middle East," he added.

He declined to say if the incident would hasten the company into developing Thaicom 6 after the loss of Thaicom 3.

"It depends on when Thaicom 5 transponders will be fully utilised," he said.

Thaicom 5, with a footprint that covers four continents, still has 30 per cent of its transponder capacity left to service customers.

Dumrong said Thaicom 5 was unlikely to suffer a similar technical glitch, although it was manufactured by the same company, given that Thaicom 5 was built with more advanced technology.

ShinSat is 41.34-per-cent owned by Shin Corp, which was founded by ousted prime minister Thaksin Shinawatra.

The satellite operator has worked under a concession of the Information and Communications Technology Ministry. Excluding Thaicom 3, it currently operates Thaicom 1, Thaicom 2, the broadband satellite iPSTAR, and Thaicom 5.

It is now linked to the Singapore state investment arm Temasek Holdings, which owns about 96 per cent of Shin Corp.

ShinSat reported in the second quarter that it expected second-half revenue to be higher than in the first half, on higher sales of iPSTAR satellite user terminals.

However, the company posted a net loss of Bt34 million for the second quarter due to higher depreciation costs of new satellites and lower-than-expected sales of user terminals due to logistics problems.

Usanee Mongkolporn,

Sirivish Toomgum

The Nation