WASHINGTON — After five month-long extensions, the U.S. government signed a seven-year agreement with Iridium Communications for unlimited use of the McLean, Virginia-based firm’s mobile communications constellation.
Iridium’s new Enhanced Mobile Satellite Services contract is two years longer and $238.5 million higher than the five-year deal it signed in 2013, roughly four years before it began deploying a second-generation constellation promising better service.
Iridium said Sept. 16 that the new seven-year, $738.5 million contract ensures continuity for voice, data, broadcast and other services to Defense Department and associated users.
Iridium’s 2013 contract was worth $400 million, or roughly $80 million per year. Under the new deal, Iridium stands to receive $105 million per year on average.
Some 125,000 subscribers use Iridium services under the EMSS contract, a figure that increased 145% since 2013.
The Defense Department is Iridium’s largest customer, making the EMSS contract pivotal for many of the company’s future plans, Tom Fitzpatrick, Iridium’s chief financial officer, said Sept. 9 at the World Satellite Business Week conference in Paris.
Fitzpatrick said finalization of the EMSS contract would pave the way for Iridium to refinance the French export-credit loans it used to fund its $3 billion second-generation constellation, ...