The Old Guard Retires

The six-year Intelsat management contract that had been negotiated for Comsat as part of the 1971 Definitive Agreements expired on February 11, 1979. Comsat had had several years, probably a decade, to plan for life without the Intelsat management contract. Comsat began several new enterprises over this period, as described in Chapters 5–8. Satellite Business Systems (SBS) and Satellite Television Corporation (STC) were unmitigated disasters, costing Comsat hundreds of millions of dollars. Inmarsat effectively began with Comsat’s MARISAT program, but eventually became an international organization based in London. As with Intelsat after 1979, Comsat’s role in Inmarsat was to “sell” satellite communications services; it did not provide overall management or engineering. There were several Comsat technology initiatives—most originating in Comsat Labs—but some were unprofitable and none replaced the income lost after February 1979. Nonetheless, Comsat had profits exceeding $30 million every year from 1973 to 1985. In 1985, the year the last of the “old guard” retired, Comsat lost over $40 million. After a major slip in 1986–1987, Comsat revenues grew steadily through 1996. Revenues in 1996 were $1 billion. In 1997, when the sell-off of non-core businesses was in full swing, revenues fell to $563 million. Comsat was able to recover from its unprofitable businesses, but the company was looking for a new direction.