Boeing Wins Big Satellite Mobile-Phone Job

Boeing Co. on Monday said it won a $1.4-billion contract to design and build the Ellipso satellite mobile-phone network for Mobile Communications Holdings Inc. and will take an equity stake in the project.

Boeing and closely held Mobile Communications are negotiating the size of the stake, Boeing spokeswoman Lou Damiani said. Under the contract, Boeing will integrate the design, development and construction of the global network, including launch services and system operations.

It is the second large-scale, space-based project Boeing has announced in recent days, following a $1.6-billion missile defense system award from the Pentagon. Boeing also is prime contractor and an investor in Teledesic, an Internet satellite project.

“Boeing wants to be a player in satellites but without undue risks,” said Peter Aseritis, an analyst with Credit Suisse First Boston. Ellipso, which will be based primarily at Boeing’s space unit in Seal Beach, is designed to bring affordable fixed, mobile and airborne voice and data telecommunications to new markets around the world. Its use of elliptical orbits is intended to lower costs. Operations are scheduled to start in 2000.

“Boeing’s leadership in the satellite industry offers tremendous technological and project management expertise and will strongly advance fulfillment of the Ellipso project,” said David Castiel, president and chief executive of Mobile Communications.

Mobile Communications, based in Washington, D.C., already has selected Lockheed Martin to provide systems engineering and integration support for Ellipso.

Shares of Seattle-based Boeing fell 63 cents to close at $51.13 on the New York Stock Exchange.