Along with other Boeing 702 Satellite users, XM Satellite Radio was recently advised by Boeing Satellite Systems International, Inc. of a potential long-term issue in the solar array output power on 702 class satellites (both XM satellites are 702s).
XM anticipates the solar array situation will have no material impact on its quality of service, conduct of business or cost of operation, but could result in an earlier than expected replacement of its satellites in order to maintain acceptable power output levels and service quality.
Power arrays on 702s in orbit have exhibited a faster than expected performance degradation during early operational life. At the present time, the output power of both XM satellites’ solar arrays are above specification and, based on Boeing’s projections from available data, should not fall below specification before the latter half of the decade.
XM has advised its insurance carriers of the above situation and the potential for an XM claim of damages. Given its insurance coverage and contractual arrangements for spare/replacement satellites, XM anticipates the solar array situation will have no material impact on its quality of service, conduct of business or cost of operation.
On Tuesday, XM officially launched the first U.S. digital satellite radio service in its lead markets, Dallas/Fort Worth and San Diego. XM’s launch will expand across the entire Southwest and Southeast United States, covering half the country, in mid-October and across the rest of the continental U.S. in November.
