The proposed military satellite communications system, called Skynet 5, is one of two alternative being considered as the follow-on to Britain's current military satellite constellation, Skynet 4. The commercially financed system would be privately developed, owned and operated -- providing communications services to the MoD under a long-term contract. The system also would provide telecommunications service to commercial customers. This approach offers the MoD the opportunity to benefit from the lower cost and cutting-edge technology of a commercially based system with the secure, protected communications previously found only in dedicated military systems.

The team recently submitted a proposal to the MoD for the Design Phase Study to define the Skynet 5 system architecture and private sector business venture to satisfy the MoD's communications service requirements in 2005 and beyond. The award decision for this phase of the two-year study is anticipated in the Autumn.

This team combines the experience of BT as a commercial and government communication service provider, the proven expertise of British Aerospace Defence Systems Limited as a systems integrator and provider of terrestrial military communication systems, and the expertise of Lockheed Martin Missiles & Space as a leading producer of communication satellites and systems for the U.S. military and commercial industry.

"We have assembled a world-class team to pursue this exciting opportunity in which the MoD could effectively harness the dynamic technology developments of the commercial world. In so doing, they can systematically and cost-effectively incorporate the continual commercial advances and breakthroughs into this defense communications program," said Mike Henshaw, President of Lockheed Martin Missiles & Space. "Skynet 5 provide a highly sophisticated dual-use telecommunications constellation for the military as well as the commercial customer at the most affordable price."

"British Aerospace Defence is proud to have successfully provided much of the ground infrastructure for Skynet 4 and looks forward to making a significant contribution to the U.K. Ministry of Defence's communications capability under Skynet 5 PFI," said Robin Southwell, Managing Director of British Aerospace Defence Systems.

"We are pleased to be working with Lockheed Martin and its partners on this exciting opportunity. In particular, we believe the PFI approach will enable the U.K. MoD to obtain leading-edge services and better overall value for taxpayers. We're glad to be associated with this important program," said Peter Slinger, Deputy Managing Director of British Telecommunications Defence.

Key objectives for the system include interoperability with U.S. and other allied communications systems and coverage over Europe, the Middle East, Africa, parts of Asia, the Atlantic Ocean and eastern United States. Skynet 5 will process much more data far more quickly than the current system, will be equipped with greater security features, and will offer surge capacity to meet MoD communication needs during military operations.

Lockheed Martin Astronautics will provide launch services, and the Missiles & Space Communications and Power Center will supply payload components. The TRW Space and Electronics Group will supply communication payloads and products. Additionally, the team will benefit from the experience of Lockheed Martin Mission Systems which currently supports BT in providing terrestrial communication services in the U.K. to the MoD through the Defence Fixed Telecommunication Service Private Finance Initiative contract.