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Evaluation report

Payload Flight Demonstration Program
PROJECT #04/05 02-03

Prepared by
Audit, Evaluation and Review Directorate

September 2005

EXECUTIVE SUMMARY

The Payload Flight Demonstration Program (PFDP) was authorized in 1999. It included an R&D component for developing a Ka-band satellite (Anik F2) and two payloads. The SpaceMux is used to enable two remote ground stations to communicate terminal-to-terminal without going through a hub. The BEAM*LINK is a multiplexing system to direct and funnel information traffic from one band to another in real time to manage transmissions more efficiently.

The Program's expenditures totalled $80 million from December 1999 to July 2004. The program is in line with other federal government programs for ensuring connectivity in order to achieve the ultimate goal of connecting all Canadians.

This evaluation covers program development, program delivery, success in achieving stated objectives and performance monitoring effectiveness. The lines of inquiry included a literature review, interviews with key informants and a survey of participating companies.

This program is a technological success. The satellite Anik F2 and its components BEAM*LINK and SpaceMux were developed and built within the initial grants and contributions budget. However, it is too early to say if the projected revenues will be reached. In order to meet the commercial satellite services forecasts, Telesat will need to launch a second satellite.

The evaluation revealed that the lack of funding for terrestrial infrastructure and the development of pertinent applications greatly weakens the ability of the federal government and taxpayers to effectively and efficiently benefit from capacity credits for using the satellite. The CSA could increase the likelihood of meeting the objectives of its programs by making sure during program planning and development that it has the resources and partnerships required for payload operations and use.

The program delivery mechanism, which involves the Communications Research Centre (CRC), is generally considered to be adequate, given the CRC's satellite communications expertise. Partnerships are the subject of collaborative arrangements. A review of these documents revealed that they failed to specify each party's responsibility in measuring performance, resulting in ambiguity concerning the roles of the CRC and CSA and in a lack of data for measuring the achievement of program objectives.

As results were not measured on an ongoing basis, the CSA is unable to adequately report on how successfully the established objectives were met, resulting in shortcomings in the management of the program and the assessment of impacts on Canadians.

When programs require the involvement and interaction of many companies to be carried out, establishing a consortium before the start of the program facilitates the program's management and increases the likelihood of success.

When US technologies are needed to build payloads, Canadian companies should enter into technological assistance agreements as soon as possible under ITAR. The CSA and CRC (or any other CSA representative) should be party to the agreement in order to have access to this information and effectively manage the program.

Despite missed initial deadlines, the satellite with the payloads aboard was successfully launched and every payload works well, representing innovation in the commercialization of the Ka-band for telecommunication purposes. This successful initiative will allow the CSA and its government partners to help achieve the goal of connecting Canadians. A great deal of work still needs to be done so that the Ka band can be used in telemedicine and tele-education, notably to convince potential users to migrate towards this technology and invest in ground infrastructure.

This report contains four recommendations that the CSA has to address in order to improve the reach of its programs to benefit Canadians.

1. To ensure that Canadians effectively benefit from the spin-offs of government programs, the CSA should, from the outset of programs, ensure that the financial resources are available for using developed technologies.

During the planning stage of programs concerning payload development, the CSA should make sure the resources for operating and using them are available. If the level of funding is inadequate, the CSA should work with various partners to develop and implement the necessary terrestrial infrastructures required to ensure the systems be used; hence Canada can fully benefit from the technologies developed by the CSA.
In order to fulfil its responsibilities and be accountable, the CSA should ensure that all program managers are aware of and assume their responsibilities regarding program performance measurement. Data have to be collected on an ongoing basis for the duration of the program. The data collected need to be analysed so appropriate action can be taken in a timely manner and the program's objectives are effectively met.

The PFDP has to generate spin-offs for Canadians in the years to come. It is essential that CSA managers be able to account for these spin-offs. Partners have to agree on the mechanism to be used to manage activities and assess performance and results.
Collaborative arrangements need to be clear with respect to the respective performance measurement responsibilities of each of the parties involved. In order to improve program management, the CSA has to ensure that the collaborative arrangements comply with CSA's policy, TB directives and that they:
- Clearly and quantitatively define the results to be achieved.
- Specify who is responsible for measuring results (whether the program's objectives have been met), measuring tools and the frequency of result measurement reports.
The CSA and its representatives (CRC) should enter into technological assistance agreements required under ITAR, in order to, among other things, ensure good management practices. They cannot properly manage programs if they are not provided with technological information. It becomes more difficult for them to fully exercise their roles as program managers.

1.0 BACKGROUND OF THE EVALUATION

In December 1999, Treasury Board (TB) approved the Payload Flight Demonstration Program. TB required that the program be evaluated in compliance with Treasury Board's Program Evaluation Policy. Given the fact that the satellite was launched in July 2004 and that the funds for this contribution program have been spent, the CSA is now obliged to evaluate the program.

The purpose of this exercise is to evaluate the commercialization of technologies developed by COM DEV and EMS, and the scope and success of the multimedia services provided by Telesat. It will also serve to:

Ensure the implementation of methods for compiling results
Draw lessons with respect to managing this type of partnership
Improve program delivery.

1.1 EVALUATION APPROACHES AND METHODOLOGY

Evaluation standards: The evaluation was conducted in compliance with CSA program evaluation policy and procedures and according to guidelines issued by the Treasury Board. The process was intended to be associative. To this end, facts were validated with all of the parties concerned.

Evaluation period: The evaluation covers expenditures incurred and results obtained over the course of the program, from December 1999 to March 2005.

Data collection: The data collection phase consisted of a literature review, an analysis of data compiled by the CSA, and interviews with the program's managers at the CSA and CRC. Data collection tools, interview guides and questionnaires were developed during the preliminary phase.

Data analysis and synthesis: Data analysis involved the following:

Comparison between results and objectives to determine the program's effectiveness
Program management efficiency
Lessons learned from running the program
Pertinence to government objectives

Report: The evaluation report consists of the following sections:

Background of the evaluation
Description of the program
Canadian industry background
Program management
Findings and conclusions
Recommendations
Annex 1: Analysis of Data Collected at Participating Companies
Annex 2: Management's Action Plan

1.2 LIMITATION OF THE EVALUATION

The program's managers failed to implement tools for collecting data on results in order to evaluate performance on an ongoing basis. Consequently, a specific questionnaire had to be developed and three of the companies involved had to be surveyed through interviews to obtain these results. The quality of this information, obtained after a relatively long period is affected compare with data colleted on a regular basis during that period.

For some objectives, results will have to be assessed at a later time once the public has used the technologies. Nevertheless, it was noted than no data collection system related to the objectives was implemented to measure the degree of success.

1.3 OBJECTIVES OF THE EVALUATION

This evaluation is intended to answer the following questions:

To what extent does the program meet the needs of Canadians?
- Providing broadband Internet access for remote areas or areas that do not have affordable Internet access.
- Enabling Ka-band use for telemedicine and tele-education.
- Developing new technologies for broadband Internet use.
To what extent have program objectives been achieved?
- Contribute to the national effort in making Canada the most connected nation in the world.
- Enhance the ability of Canadian industry to commercialize technologies.
- Foster the development of a scientific culture and inspire young people to choose careers in science and technology.
- Enhance Canada's reputation in science and technology and instil a sense of pride among Canadians.
To what extent were the objectives related to job creation and the sale of technologies developed under this program achieved?
To what extent were management practices appropriate and of good quality?
· What improvements does the CSA need to make in terms of performance evaluation?

2.0 BACKGROUND AND DESCRIPTION OF THE PROGRAM

THE GOVERNMENT'S STRATEGIC OBJECTIVE

In its Speech from the Throne in February 2004, the Government of Canada reaffirmed its commitment to promoting the economic development of all of Canada's regions. This involves implementing broadband services in rural communities, where such services could help overcome the distance barrier.

The government believes that connectivity is the basis of the knowledge economy and today's society. The efficiency and speed with which Canadians can access and use the information highway are essential for maintaining and more rapidly intensifying Canada's presence in the global economy. The Government of Canada has committed itself to ensuring that all Canadian communities have access to affordable high-speed Internet services by 2005.

In 2000, Canada ranked second behind the United States in terms of connectivity to, accessibility to and use of information technology and communications.¹ One quarter of Canadians did not have access to high-speed services offered by cable and telephone companies owing to a lack of infrastructure.

CONNECTIVITY

Connectivity has been a priority of the federal government since 1995, when the government committed itself to making information and knowledge infrastructure available to all Canadians so as to make Canada the most connected country in the world.

Connectivity is defined as the availability of ground and space infrastructure that enables Canadians to access the Internet for communication purposes regardless of where they live. It is the basis of the knowledge economy because it offers:

New learning opportunities
Opportunities for interaction
Opportunities to do business
Opportunities for developing Canada's economic and social potential
Security for Canadians and
Growth for communities

In the last few years, the federal government has implemented a number of programs to attain this level of connectivity. By developing a broadband network, Canada is giving itself new opportunities with respect to on-line learning, health care and access to government services.

BACKGROUND OF BROADBAND SERVICES

Canada is a leader in using the most widespread broadband technologies in terms of access, notably cable modems and digital subscriber lines (DSLs). Among OECD member countries, only Korea ranks ahead (OECD, 2002).² In 2004, Canada ranked fifth on the use of the broadband services.

Many regions of the country, particularly rural and remote areas, are unable to use broadband Internet services other than those provided by more costly (and relatively slower) satellites. The geographic distribution of Canadians is a big challenge in the delivery of high-speed Internet services, largely because of the high cost of upgrading infrastructure and of serving a very vast area. Broadband communications in remote areas are more beneficial there than in urban centres because their real advantage lies in their capacity to minimize time and distance factors in cost.

Broadband can transmit a great deal of information compared to traditional Internet access modes (i.e. narrow-band or dial-up access by telephone and standard modem).

By improving access speed for information traffic transmitted between networks and computers via Internet, broadband technologies can transmit large files much faster than dial-up Internet connections. However, the transmission of large volumes of information is not a characteristic of all broadband technologies.

In addition to allowing two-way transmission that does not require a telephone line, these broadband technologies provide permanent connectivity, which is generally more secure and is required for certain applications, such as telemedicine.

The National Satellite Initiative (NSI) was established to offer broadband services at a lower cost to communities in the Far to mid-North and to isolated and remote areas of Canada, where satellite technology is the only practical and affordable solution. The NSI will help substantially to reduce the cost of accessing broadband services for these communities by making satellite access affordable. The regions will be able to take advantage of telemedicine, tele-education, telework and e-commerce services through wireless broadband Internet connections. In the end, access to broadband services (through Anik F2 technology using the Ka band) will increase remote communities' opportunities to move forward both socially and economically.

HORIZONTAL INITIATIVE AND PARTNERSHIP

The following table lists the partners involved in the initiative for using the Ka band for telemedicine and tele-education purposes. It also indicates the roles of those directly involved in the Payload Flight Demonstration Program. Their respective roles are explained in greater detail below.

Organization	Responsibilities
Canadian Space Agency (CSA)	Provided the funding for the Payload Flight Demonstration Program. Involved in the National Satellite Initiative by contributing a service credit of $50 million for the satellite transmission capacity that is available to the Government of Canada.
Communications Research Centre (CRC)	Provided technical advice and supervision for various technologies that are now in orbit aboard Anik F2. Managed the Payload Flight Demonstration Program. Managed the $2.1-million operating budget.
Industry Canada	Was responsible for the National Satellite Initiative, which is intended to provide high-speed Internet access for communities in the Far and mid-North and isolated and remote areas in Canada where satellite technology is the only practical solution to connect residents. Provided the satellite transmission capacity intended for public use (a value of $20 million for phase 1). Other fund will be added for subsequent phases.
Infrastructure Canada	Covered part of the funding for the National Satellite Initiative, with $85 million coming from the "national priority projects" envelope of the Canada Strategic Infrastructure Fund.
Source: Web sites of various organizations

The CSA used a national bid process to choose which companies would take part in the PFDP, which followed the Advanced Satellite Communications Initiative Program.

The CSA entrusted the CRC with managing the program because of its telecommunications and satellite expertise. The transfer of these responsibilities was the subject of collaborative arrangement among the various parties. The CSA is a member of various committees that oversee the use of Anik F2 government capacity credits under the NSI.

The CRC is an Industry Canada agency and is the Government of Canada's main centre of expertise for satellite communications (SATCOM). On behalf of the CSA, it oversees most of the implementation work under the SATCOM component of the Canadian Space Plan. It serves as an authority on technical and contractual questions related to multi-million-dollar development projects subcontracted to the industry. Lastly, the CRC works with suppliers and users of services distributed by satellite by developing and demonstrating applications, such as those for telemedicine and tele-education.

CRC managers involved in managing the Payload Flight Demonstration Program continue to attend meetings on remote communities' use of Anik F2's Ka band.

Industry Canada is mandated to help Canadians be more productive and competitive in the knowledge economy and improve their quality of life. Through the CRC, the Department promotes R&D in innovative technologies that will give better access to high-speed broadband services at a better price.

Industry Canada established the Broadband for Rural and Northern Development Pilot Program in September 2002. This $105-million pilot program, carried out in conjunction with the private sector, will help increase the number of communities that have access to broadband communications. It will give Canadians access to health care, education and continuous learning services and help them capitalize on business opportunities while ensuring the economic and social future of all Canadians.

The Broadband for Rural and Northern Development Pilot Program complements the $155-million National Satellite Initiative announced on October 5, 2003. Broadband access will increase opportunities for Aboriginal communities in the North and rural areas to move forward socially and economically.

In addition to the above-mentioned programs, together with the NSI and CRC, the CSA is funding a pilot project to demonstrate technology reliability and promote the use of the Ka band.

The horizontal initiative related to the PFDP is still being developed, requiring the involvement of all parties interested in achieving all of the program's objectives. Funding still needs to be found for the construction of ground infrastructure enabling users in Canada's remote and northern areas to access this technology.

PAYLOAD FLIGHT DEMONSTRATION PROGRAM

The CSA decided to fund the Payload Flight Demonstration Program because the program allowed it to help meet the federal government's strategic connectivity objective. The program focussed on the development of a large-capacity satellite for giving rural and remote Canadian regions access to the Internet via satellite. Those areas will enjoy the same advantages as other regions in Canada in terms of high-speed broadband Internet access at affordable prices.

PROGRAM OBJECTIVES

The Payload Flight Demonstration Program was approved in December 1999. Based on official documentation, the reimbursement of the contribution was conditional on the success of the satellite's launch and the commissioning of the payload. The reimbursement was to have been in kind in the form of multimedia satellite services, subsequently called government capacity credits.4

The program's objectives, which are set out in the official documents, are as follows:

Contribute to the national initiative for making Canada the most connected country in the world.
Access to an appropriate satellite platform, such as the Anik F2 multimedia system, is essential to the success of the Connecting Canadians program. Throughout the country, consumers, institutions and companies could greatly benefit from the social and economic spin-offs generated by services such as telemedicine, tele-education, telework, e-commerce, and access to government services and high-speed Internet. The Anik F2 multimedia system will be developed to ensure that all Canadians have access to it (and that it is affordable, regardless of location) and these types of services.
Improve the capacity of Canada's industry to commercialize technology.
Canada's satellite industry enjoys undeniable advantages through a number of payload development components. The capacity of the manufacturing and service sectors to commercialize innovative technology integrated into the system will be significantly improved, with Telesat being the first to launch such a payload on the market and to have performed a flight demonstration. This unique opportunity could lead to significant spin-offs for numerous Canadian companies, in addition to EMS and COM DEV. The Canadian Space Program favoured the establishment of a large number of Canadian companies whose competencies in some market niches are recognized internationally. They are in the process of capitalizing on opportunities resulting from the demonstration of space competencies in Canada.
Foster the development of a scientific culture and encourage young people to choose careers in science and technology.
The payload will also serve as an R&D platform from which Canadian university students and researchers will be able to conduct scientific trials on advanced multimedia technology and studies on the impact of the propagation of high frequencies, while developing techniques to minimize impacts. In addition, the platform will be used to distribute a wide range of advanced services through the implementation of the SchoolNet and Community Access initiatives, favouring the sharing of ideas and information between young Canadians from across the country through advanced applications.
Enhance Canada's reputation in science and technology and instil a sense of pride among Canadians.
Putting Canadian talent to good use in building the first advanced multimedia services satellite in North America will enhance Canada's international reputation and give Canadians a sense of national pride. Anik F2's multimedia payload will make it the most advanced commercial telecommunications satellite in the world, integrating complex technologies that are developed, built and operated by Canadians.

This contribution program funded the development and flight demonstration capabilities of a new generation of communication satellites, including the Ka band.

ECONOMIC SPIN-OFFS

In addition to these specific objectives, the program also had to allow for the maintenance and/or creation of the equivalent of 208 highly skilled jobs over the course of the 1999-2005 period. Commercialization potential forecasts for each technology developed by COM DEV and EMS as well as Telesat satellite sales and services were included in the documents in support of the program authorization.

TECHNOLOGICAL DEVELOPMENT

The Anik F2 satellite was designed to support and enhance data, voice and broadcast services currently offered in North America using the C and Ku bands.³ Furthermore, this advanced satellite features state-of-the-art innovation: a multimedia payload featuring the latest technology that uses the new Ka band frequency. This payload was developed as part of a partnership with the public and private sectors involving the CSA, the Communications Research Centre, Telesat Canada, EMS Technologies Canada Ltd and COM DEV International Ltd.

The SpaceMux technology developed by EMS should allow two remote ground stations to communicate terminal-to-terminal without going through a hub.

COM DEV's BEAM*LINK system is a multiplexing system for directing and funnelling information traffic from one band to another in real time to more efficiently manage transmissions.

The following table shows the respective elements for which each company was responsible and the amounts of the related contribution.

Company	Consideration	Amount
Telesat Canada	Anik F2 satellite	$60 M
EMS Technologies Canada Ltd	SpaceMux digital processing system	$9.5 M
COM DEV International Ltd	BEAM*LINK	$10.5 M
Source: document for authorization, 1999

KA-BAND ADVANTAGES

Ka-band is a high radio frequency that allows large amounts of data to be transmitted to and received from small satellite antennas at competitive prices. Higher frequency can be more easily shaped than their lower frequency and then the service prices are lower. The supplier can re-use the same frequency and reduce its transmission prices. Ka-band also offers the advantage of small easy-to-install antennas by using the more powerful beam.

RESULTS FOR CANADIANS

In order to reimburse the $60 million allocated by the Canadian Space Agency for the Anik F2 project, Telesat will provide the Government of Canada with multimedia satellite services worth $50 million. These services were transferred through a collaborative arrangement and will be used for the NSI. The capacity credit for using the satellite is allotted over 10 years. The annual value of these credits is estimated at $5 million. The CSA also has access to the SpaceMux for technology and application R&D for a five-year period and to the Ka-band radio beacons for further study. The latter elements have an estimated value of $10 million.

The PFDP is in line with ongoing CSA efforts to help companies develop satellite communications technologies under the Advanced Satellite Communications Initiatives Program.

3.0 CANADIAN INDUSTRY

ECONOMIC CONTEXT⁴

The Canadian space industry comprises approximately 202 private companies, universities and research centres employing nearly 7 445 people. In 2004, total revenues for the Canadian space industry were nearly $2.44 billion, which represents 22% increase compare to 2003. This increase is largely attributable to export revenues.

In 2004, the telecommunications sector dominated all other space industry sectors in Canada, generating 75% ($1.83 billion) of all reported space revenues. Over the last five years, telecommunication revenues show a 98% increase.

SATELLITE TELECOMMUNICATIONS MARKET TRENDS IN 2004⁵

Broadband satellite communications services have broken into the market a little less quickly than expected, notably due to the relatively high installation costs that users have to cover. Nevertheless, forecasts are quite favourable.

The Ka band is currently the best solution for other satellite operators that wish to provide cost-effective high-speed and two-way Internet services. However, there are potential drawbacks to using the Ka band:

The band's range of high frequencies leads to greater rain fade problems.
The addition of Ka-band services would require dual or steerable antenna and direct-to-home (DTH) operators would have to replace legacy user equipment.
The relatively high cost of receivers (attributable to the low volume currently sold) is a factor that slows down the transition to Ka-band services.

The US government is promoting greater use of broadband services. In 2003, the US Department of Agriculture launched a $1.4-billion guaranteed loans program to improve broadband telecommunications services in rural areas. In addition, the US Federal Communications Commission indicated that it would allocate a large part of its 2004 budget to promoting the deployment of broadband telecommunications services.

In fall 2003, Telesat entered into a partnership with March Networks to develop a technology through which health care services could be provided to remote areas via Telesat's Anik F2 satellite. The CSA, the European Space Agency, March Networks and Telesat jointly funded the $1.5-million project, whose objective was to commercialize advanced telemedicine applications beginning in fall 2004.

Broadband satellite communications systems have been tested in the marketplace. Uncertainties about satellite broadband broadcasting were dispelled in 2004. WildBlue launched the first broadband Ka-band satellite communications service using Anik F2. The initial foray into this target market will be closely watched by many to determine whether the business model works. In particular, much attention will be focussed on how to deal with the costs of end-user equipment. Up to now, consumers have been reluctant to accept the high cost, and satellite operators and service providers have in turn been reluctant to subsidize the costs, as is the case in the cell phone or DTH industries.

4.0 PROGRAM MANAGEMENT

Within the framework of its various programs that include a satellite communications component, the Canadian Space Agency turns to the CRC, an expert in satellite communications, for all matters related to program management.

The CSA has signed collaborative arrangements with its partners to successfully carry out the program and serve the public interest. Based on these agreements, the CRC was responsible for managing the program and ensuring that it ran smoothly. It reported to the CSA, which was responsible for making important decisions regarding the program.

According to TB directives, these collaborative arrangements should describe the role of each partner and cover accountability mechanisms.

Effective accountability requires the following:

Clear expectations that have been agreed on.
Clearly defined roles and responsibilities.
Realistic expectations (ie, balance between expectations and capabilities).
Credible reports.
Reasonable review, program evaluation and audit procedures.

PERFORMANCE MEASUREMENT

Our review of the collaborative arrangement revealed that it did not include a number of essential elements. Roles and responsibilities regarding performance measurement were not specified. This lack of clarity weakened accountability. Nowhere in the agreement is there mention of the program's performance measurement or follow-up of program beneficiaries to ensure that the established objectives have been met.

The program's managers at the CSA and CRC reported that they were not responsible for measuring and monitoring the program's performance. None of the partners assessed the degree to which the objectives had been met, nor did any of them track economic spin-offs among businesses. The satellite was launched and is operational, which is easy to assess and has been assessed.

With respect to results that are to take shape through the use of the technologies, no analysis and data collection system is currently implemented to determine the degree to which the objectives have been met and to take action to achieve them.

CONSORTIUM

One of the elements that facilitated the management of the PFDP was the existence of the consortium of private companies prior to the program's implementation, which allowed for better synergy between the companies. The dynamics resulting from the consortium allowed the companies to work together to solve problems that arose over the course of the initiative and to honour commitments with respect to the systems to be delivered. The existence of the consortium at the outset of the program was a key factor in its success because each party makes commitments together with the others. Each company works toward the success of the entire program. Compared to other programs for which no such consortium was established, it was easier to meet deadlines and honour commitments.

In the space industry, one of the constraints is: the numerous regulations that program managers and the CSA had to take into account from the outset of the program.

In the case of the PFDP, as the satellite manufacturer was a US company, ITAR applied from the outset and limited access to some technological information. Delays in the signing of technical assistance agreements between Telesat and Boeing resulted in program deadlines being missed. The CRC had to rely solely on Telesat with regard to technology development, as it did not have access to US technical information.

5.0 FINDINGS AND CONCLUSIONS

Here are the findings and conclusions drawn from the collection and analysis of the data available with respect to the program's pertinence, objectives and results to date, and program management efficiency.

5.1 PERTINENCE OF THE PROGRAM

To what extent does the program meet the needs of Canadians?

The program is consistent with the CSA's mandate to provide assistance for R&D and the development of new technologies, which will put Canada at the forefront in commercialization of the Ka band. The initiative is directly in line with the Connecting Canadians program, a government priority since 1995 piloted by Industry Canada. It is intended to try to eliminate the technological deficit so that all Canadians have high-speed Internet access. The Ka band helps improve availabilities and opportunities for using broadband Internet.

5.2 MEETING OF OBJECTIVES

To what extent has the program met the established objectives?

CONNECTIVITY - TELEMEDICINE AND TELE-EDUCATION

Some remote regions already have access to broadband Internet using the C or Ku bands for telemedicine and tele-education. These users do not see the need to change equipment or the band and have concerns about the difference in cost.

The CSA helped fund a pilot project established in March 2005 that was intended to demonstrate technical feasibility and promote the possible use of the Ka band for telemedicine and tele-education in remote areas. It also sought to show the advantages of using Ka band technology with DVD-RCS technology. These efforts were made to encourage remote communities to equip themselves with terrestrial infrastructure to be able to use the government capacity credits available for the next 10 years.

Although these two objectives have not been met, various partners continue their efforts to achieve them. It would have been more effective to address the ground infrastructure factor well before the satellite's launch in order to take full advantage of the government capacity credits. Considering the time needed to establish the infrastructure and to find the funding required for the terminals and other equipments that the communities need to use Ka band technology, Canada will have lost one to two years of credits if everything runs smoothly.

The credits have been valid since April 1, 2005, the date on which the satellite was commissioned. They expire at a rate of $5 million per year, regardless of whether they have been used. An additional year is granted for beams serving the North. The country will not fully benefit from the government capacity credits, despite all of the efforts made to date by various government departments and agencies.

CONNECTIVITY - CONTRIBUTING TO THE NATIONAL INITIATIVE FOR MAKING CANADA THE MOST CONNECTED COUNTRY IN THE WORLD

Based on information obtained from CRC managers, everything is in place for all Canadians to be connected. The Anik F2 satellite, launched with Beam*Link and SpaceMux equipment on board, consists of the space technology that is needed to meet the objective. Telesat ensured the success of the launch and commissioning of the satellite before investing in the ground infrastructure that gives access to the technology. In the coming months, most Canadians will be able to acquire the necessary antennas and modems and call on professional installation services.

Telesat joined forces with a Canadian broadband service provider to offer the Ka band to Canadians. Consumers will have to purchase and install equipment costing an average of $600. Fees ranging from $60 to $90 per month for link speeds ranging from 512 kilobits to 1 megabit per second will be payable to the service provider.

According to Bruce Barr, President and CEO, Barrett Xplore, "Telesat's new satellite is the first in the world to commercialize the Ka-band frequency, a breakthrough communications technology for delivering cost-effective, two-way broadband services. Using Telesat's Ka-band technology will enable Xplornet to deliver always-on, always-ready high-speed Internet connectivity everywhere in Canada."⁶

According to Statistics Canada, Canadians were among the largest users of broadband services in the world in 2001. Nearly half (49%) of households that use the Internet regularly had a high-speed connection. In the private sector, 2002 marked the first year in which the majority (58%) of businesses with Internet connections had access to broadband technologies.

The PFDP helps meet the government objective of connecting Canadians. Even if the costs for high-speed Internet services in rural and remote areas are comparable to costs for similar services offered in urban centres, the business plans for providing these services to small communities in a commercially viable manner still need to be developed. Public support is essential to overcoming this barrier, according to a report by the National Selection Committee of the Broadband for Rural and Northern Development Pilot Program.

CANADA'S SCIENTIFIC CULTURE

Foster the development of a scientific culture and encourage young people to choose careers in science and technology.

These are long-term objectives that will be met in part with the implementation of applications in under-connected Northern regions through the use of the $50-million access credit for the four northern beams. These objectives will be evaluated once the government capacity credits for Anik F2 are used. To do this, the CSA has to implement data collection elements and determine to what extent the objectives have been met.

CANADA'S REPUTATION

Enhance Canada's reputation in science and technology and instil a sense of pride among Canadians.

Due to the technological success related to the development of this satellite and the commercialization of the Ka-band, Canada continues to be recognized as a country avant-gardiste in satellite communications.

TECHNOLOGY - IMPROVING THE CANADIAN INDUSTRY'S CAPACITY TO COMMERCIALIZE TECHNOLOGIES

Telesat's Anik F2 satellite will go down in history as the first satellite that was truly intended for commercializing Ka band frequencies, a revolutionary satellite communications technology for providing two-way broadband services in a cost-effective manner. Telesat was able to commission its entire Ka-band network and link a gateway ground station in Ottawa to remote stations.

The PFDP served to develop and test new technologies that greatly improve the use of high-speed Internet via the Ka band. This technology will improve the reliability of telemedicine and tele-education applications.

Thanks to this contribution, EMS Technologies developed an experimental onboard processor, the SpaceMux, which enables two remote ground stations to communicate directly with each other using Anik F2's Ka-band spot beams without going through a hub. This innovative technology enables people to communicate terminal-to-terminal.

For its part, COM DEV developed BEAM*LINK, a multiplexing system to direct and funnel information traffic from one band to another in real time, hence, in a more efficient manner, since it is now possible to avoid "traffic jams" by re-routing the overflow to other frequencies or bands.

From a technological perspective, we can conclude that the trials of these various state-of-the-art technologies will enable three Canadian companies involved in the program to improve their capacity to commercialize the technologies.

COMMERCIALIZATION POTENTIAL

According to the authorized terms of reference, the program was to have improved the capacity of the manufacturing and service sectors to commercialize innovative technologies that were integrated into the satellite. Considerable economic spin-offs were forecast for each component. The value of the global broadband multimedia satellite services and terminal equipment market was estimated at USD$50 million in 1999. Sales projections for equipment related to these technologies were based on a study of the market at the time.

It was also expected that 208 highly skilled jobs would be created over the course of the five years during which the satellite and subsystems related to the program were developed.

The tables below indicate projections per company and the degree to which the projections were accurate. The companies concerned requested that some information deemed sensitive be kept confidential which are not included in this report.

Table 1-EMS

Impact	Expected	Actual	Projected	Comments
Employment
FTE's	75*	Significantly higher		Met
Ratio of HQP's	Majority	75 %		Met; total HQP's greater than expected
Commercialization	$35M		Equal or greater than	On track

Table 2-COM DEV

Impact	Expected	Actual	Projected	Comments
Employment
FTE's	101*	Significantly Higher		Met
Ratio of HQP's	Majority	66 %		Met; total HQP's greater than expected
Commercialization	$40M		Equal or greater than	On track

Table 3-Telesat

Impact	Expected	Actual	Projected	Comments
Employment
FTE'S	32*	Slightly greater than expected		Met
Ratio of HQP's	Majority	90 %		Met
Commercialization	$1.25B		Significantly less	The business model was changed. The expected figure implied additional satellite investment that has yet to be found.
Connectivity
Ratio of off-net communities that should be covered by Anik F2	Nearly 100%	Nearly 100% of communities can be served by Anik F2		Met. However, small communities still face financial hurdles to long-term commercially viable services.

*The 208 jobs forecast were divided on a pro rata basis, including subcontracts allocated by Telesat to the other two companies.

(1) The sales of the subsystems and satellite communications services will materialize in the coming years. Forecasts were extended until 2008. It will be important to measure these achievements in the further years.

USE OF THE KA BAND

Consumers are reluctant to use the Ka band. Partners have to mobilize to find a solution to the lack of available ground infrastructure and the scepticism of potential users. To do this, they have to make the necessary resources available to demonstrate the advantages of this technology through a pilot project. User's integration at the beginning of the program is a key component to ensure application efficiency and achievement of planned benefits.

Despite delays in the initial schedule, the industry honoured its commitments to launch the satellite with the equipment aboard. The terrestrial equipment is available throughout the country, and users can acquire the necessary equipment for accessing high-speed Internet via satellite for the Ka band.

5.3 PROGRAM MANAGEMENT

COLLABORATIVE ARRANGEMENT

The collaborative arrangement that the CSA entered into with its various partners are incomplete and contain elements covering other programs without appropriately defining the scope or expectations. As mentioned in section 4, the performance measurement and expected results are not clearly set out in the agreements.

TECHNOLOGICAL ASSISTANCE AGREEMENT

Technological assistance agreements between Canadian and US companies as required under ITAR, were signed at the beginning of the program. As the CRC was not a co-signatory to the agreements, it did not have access to all of the technological information and did not have complete control over the program. As a result, it was not able to fully manage the program and had to rely on Telesat with respect to certain technological matters.

CONCLUSION

Although the program's objectives were partly met, a great deal of work still needs to be done before all of the objectives established at the beginning of the program are achieved. Canada will lose some of the government capacity credits because ground infrastructure is not in place and was not taken into account during the planning stage or while the program was being carried out.

The risk that CSA decided to take, by not financing the ground segment, is an important point and the consequences for Canada are that it cannot take advantage of the capacity credit for telemedicine and tele-education. CSA should have negotiated with Telesat for the benefit of the Canadian taxpayers. Now, Telesat has begun with the reimbursement (services in-kind) and the Canadians cannot receive the advantages associated with.

6.0 RECOMMENDATIONS

The recommendations of this evaluation are based on an analysis of information obtained from various partners and beneficiaries and on findings set out in the preceding sections.

It is recommended that CSA management take the following measures to improve the delivery of its existing and future programs.

PLANNING OF PAYLOAD USE AND OPERATION

Since the commissioning of Anik F2, Canada has had the right to use the satellite without truly being able to benefit from it. To ensure that Canadians effectively benefit from the spin-offs of government programs, the CSA should, from the outset of programs, ensure that the financial resources are available for using the technologies developed.

During the planning stage of programs concerning payload development, the CSA should ensure that the resources for operating and using them are available. If the level of funding is inadequate, the CSA should work with partners to develop and implement the necessary terrestrial infrastructures required to ensure the systems be used; hence Canada can fully benefit from the technologies developed by the CSA.

PROGRAM PERFORMANCE MEASUREMENT

In order to be accountable, the CSA should ensure that all program managers are aware of and assume their responsibilities regarding program performance measurement. Data need to be collected on an ongoing basis for the duration of the program. The data collected have to be analysed in order to take action in a timely manner and to ensure that program objectives are met efficiently.

The PFDP has to generate spin-offs for Canadians in the future. It is essential that CSA managers be accountable for the spin-offs. Partners need to agree on a mechanism to manage activities and measure performance and results.

COLLABORATIVE ARRANGEMENT

The CSA maintains that the CRC is responsible for performance measurement and following up on the objectives of Canadian companies. The CRC is not responsible for following up on results, after the majority of the funding for the project is paid out. This inconsistency is due to a lack of understanding of the roles and responsibilities of each party, with the collaborative arrangement making no mention of them.

Collaborative arrangements need to clearly set out the respective responsibilities of parties regarding performance measurement. In order to improve program management, the CSA should ensure that these collaborative arrangements comply with CSA's policy, TB directives and that they:

Clearly and quantitatively define the results to be achieved.
Specify who is responsible for measuring results (whether the program's objectives have been met), measuring tools and the frequency of result measurement reports.

PROJECT MANAGEMENT

The CSA and its representatives (CRC) should enter into technological assistance agreements required under ITAR, in order to ensure good management practices. They cannot properly manage programs if they are not provided with technological information. It becomes more difficult for them to fully exercise their roles as program managers.

ANNEX 1 - ANALYSIS OF DATA COLLECTED FROM PARTICIPATING COMPANIES

Assessment of socio-economic impacts
of the Payload Flight Demonstration Program

Prepared by
Philip Price,
Price Aerospadef Inc.

May 2005

Executive Summary

In April 2000, Telesat Canada, EMS Technologies and COM DEV were awarded contracts to develop and implement an advanced Ka-band multimedia payload for the Anik F2 Satellite that was successfully launched on July 17, 2004. The terms and conditions of the Canadian Government's participation were approved in 1999. The approval documents included among other things the requirement for independent program reviews the first of which is being carried by CSA's Audit, Evaluation and Review Directorate. One of the components of this overall program evaluation and the objective of the work reported on in this report is to capture the information related to the socio-economic impacts that were identified within the presented document for approval

The assessment performed for CSA consisted of a background research and analysis of program and company related documentation, questionnaire development and interviews and data collection and analysis. This report provides a summary of this assessment.

The socio-economic benefits anticipated initialy have largely been met except for the commercial success of the satellite-based broadband telecommunications services. The assumptions underlying the anticipated results in 1999 were significantly affected by the greater than anticipated downturn in the global telecommunications sector.

Despite this harsh business environment EMS and COM DEV are capitalizing on the investments made by the Payload Flight Demonstration Program and through continued R&D and business development activities are on track to meeting the program objectives stated within the documents for approval. Telesat on the other hand will not achieve the projected revenues of $1.25B, as the company has made changes to its business model to adapt to the changing market dynamics and has not yet invested in the additional satellite systems that would also be required to achieve these revenues.

The Ka-band payload within Anik F2 was a bold opportunity to get a jump start on the competition and in this respect it has succeeded in providing Telesat with business knowledge and opportunities that otherwise would not have occurred. The company is consequently well positioned to increase its market share within the space-based broadband telecommunications sector.

The Canadian connectivity agenda is seen to be on track. The government's objective of breaching the digital divide has benefited significantly from this program since all except one or two small communities have access to broadband services. However, even if the price for high-speed Internet service to remote and rural subscribers is nearly comparable to the cost of similar services in Canadian urban centres, the business case for the provision of commercially viable services to these small communities is yet to be made. Continued public support is considered necessary to overcome this last hurdle.

Background

In April 2000, Telesat Canada, EMS Technologies and COM DEV were awarded contracts to develop and implement an advanced Ka-band multimedia payload for the Anik F2 Satellite that was to be launched in late 2002. The satellite was successfully launched on July 17, 2004 and began operational services on October 7, 2004. Anik F2 made history as the first satellite to fully commercialize the Ka-frequency band - a breakthrough satellite communications technology for delivering cost-effective, two-way broadband services.

Anik F2's unique Ka-band module is the product of a public-private partnership formed between the Canadian Space Agency, Communications Research Centre Canada, Telesat, EMS Technologies and COM DEV. The terms and conditions of Canadian Government's participation were approved in 1999. The documents for approval included among other things statements regarding the socio-economic impacts of the program.

Objectives

In accordance with CSA's evaluation policy and as proposed within the documents for approval, independent program reviews will be carried out on the Payload Flight Demonstration Program. CSA's Audit, Evaluation and Review Directorate in compliance with these directives have initiated a mid-term evaluation of the program covering the period 14-09-1999 to 17-07-2004.

One of the components of this overall program evaluation and the objective of the work reported on in this report is to capture the information related to the following socio-economic impacts that were identified within the submission for authorization:

Potential for commercialization
- COMDEV- potential sales of at least $40M for its BEAM LINK subsystem and related technologies over five years following the launch of AnikF2.
- Telesat-to achieve cumulative revenues related to services offered of $1.25 billion by the end of 2008.
- EMS-potential sales of at least $35million for its Space MUX digital processor subsystem and related technologies over the same period.
Employment
- The program was expected to generate/maintain at least 208 FTEs of direct employment over the five year period, 1999 to 2004.
- Category: high skilled jobs mainly in Ste Anne de Bellevue, Quebec; Cambridge, Ontario and in the NCR.
Connectedness
- The availability of a system like Anik F2 was stated as being critical to the success of the "Connecting Canadians" government agenda. It was also noted that many Canadians live in geographic areas that are off-net and that the Anik F2 Multimedia System would be designed to ensure that broadband/multimedia services were available to all Canadians.

Methodology

The assessment performed for CSA consisted of the following activities:

Phase I: Background Research and Analysis of documentation

An in-depth review of the requirements of the mid-term evaluation of the Payload Flight Demonstration Program was performed during the kick-off meeting to accurately define the socio-economic impacts and commercialization potential that need to be verified. Documents and other sources of information relevant to these above noted requirements were identified at the kick-off meeting and subsequently provided.

These documents and the companies' web sites were reviewed and a summary of the highlights prepared as a guide for the follow-on activities.

Phase II: Data Collection

The work within this phase consisted of identifying the information elements required and completing an interview guide for the three companies awarded contributions within the program. Following the submission of an introductory letter submitted by CSA, a questionnaire was submitted to the person identified as the appropriate point of contact for each of the companies. Copies of these questionnaires are attached as Appendix 1, 2 and 3 of Annex D.

A meeting was then arranged with each of the company's point of contact to clarify CSA's expectations and determine the suitability of data proposed by the company. Other company personnel that were involved in activities such as business development, marketing and contracting, also attended these meetings.

Responses by the companies were discussed at the meeting and formally submitted or validated by the company a short time later.

Phase lll: Data analysis and Preparation of Report

Responses to questionnaires were reviewed for consistency with company proposals, and statements made within program approval documents and deliverables provided during the contract implementation phase. Where inconsistencies were noted, arguments supporting these discrepancies were sought to enhance the credibility of the data.

Following an analysis of the data, the information related to the direct and indirect impacts of the program were compiled and linked to the findings.

The report was prepared initially as a draft for CSA's review and then as a final report addressing the comments provided by CSA.

Survey and data analysis

The survey consisted of having COM DEV, EMS and Telesat respond to a questionnaire adapted for each of the company's specific contribution and related technologies, products and/or services. Annexes A, B and C summarize the responses provided by the companies along with additional relevant information obtained during the interview, through telephone conversations or via e-mail correspondence. Certain elements of the information provided by the companies were declared company sensitive. In accordance with the companies request these were factored into the assessment but not identified specifically.

The following Tables 1, 2 and 3 provide in relative terms a high level summary the findings of the impact assessment:

Table 1-EMS

Impact	Expected	Actual	Projected	Comments
Employment
FTE's	75*	Significantly higher		Met
Ratio of HQP's	Majority	75 %		Met; total HQP's greater than expected FTE's
Commercialization	$35M		Equal or greater than	On track

Table 2-COM DEV

Impact	Expected	Actual	Projected	Comments
Employment
FTE's	101*	Significantly Higher		Met
Ratio of HQP's	Majority	66 %		Met; total HQP's greater than expected FTE's
Commercialization	$40M		Equal or greater than	On track

Table 3-Telesat

Impact	Expected	Actual	Projected	Comments
Employment
FTE'S	32*	Slightly greater than expected		Met
Ratio of HQP's	Majority	90 %		Met
Commercialization	$1.25B		Significantly less	Business model has changed; Expected figure implied additional satellite investment that is yet to be found.
Connectedness
Ratio of Off-net Communities covered by Anik F2	Nearly 100%	Nearly 100% of communities can be served by Anik F2		Met; however small communities still face financial hurdles to long-term commercially viable services.

* This number is pro-rated from the overall total of 208 stated within the official documents. The ratio used for each company is the amount of contribution expended within each company over the total contributions awarded to all three companies.

Results

The socio-economic benefits anticipated initially have largely been met except for the commercial success of the satellite-based broadband telecommunications services. The assumptions underlying the anticipated results in 1999 were significantly affected by the greater than anticipated downturn in the global telecommunications sector. Overcapacity in both cable and satellite infrastructure coupled with an insecure investment environment resulted in a significant drop in satellite contract opportunities and much lower than expected margins and uptake for broadband services. For the satellite system producers this has led to a different mix of products being marketed and significant delays in the anticipated sales build-up. For the service providers such as Telesat it has lead to significant lower user terminal prices and reduced margins due to a larger than expected level of sales achieved through wholesalers such as Wildblue. Overall for Telesat the Anik F2 investment has resulted in less than anticipated revenues in the short term. However, this early investment may provide significant returns in the long term as Telesat positions itself to serve the slowly growing but nevertheless significant market.

Conclusions

The Satellite Communications sector has over the last five years weathered a major setback with respect to even the most conservative of market assessments. Several companies have disappeared or merged with others to maintain some form of critical mass. Large companies have had to reduce overhead and have outsourced complete divisions that were once thought to be core capabilities. In light of this harsh business environment EMS and COM DEV are capitalizing on the investments made by Payload Flight Demonstration Program and through continued R&D and business development activities are on track to meeting the program objectives stated within the documents for approval. Telesat on the other hand will not achieve the projected revenues of $1.25B, as the company has made changes to its business model to adapt to the changing market dynamics and has not yet invested in the additional satellite systems that would also be required to achieve these revenues.

The original estimate for service revenues did not factor in the satellite's capacity. This was corrected in the Commercialization Plan delivered in 2002. This system level correction was however still insufficient to compensate for the highly competitive market that resulted from the sudden over-capacity in telecommunications infrastructure. Telesat has had to make changes to its business model to adapt to the changing market dynamics.

The Ka-band channels within Anik F2 were a bold opportunity to get a jump start on the competition and in this respect it has succeeded in providing Telesat with business knowledge and opportunities that otherwise would not have occurred. Indeed Telesat is investigating an all Ka band satellite for the near future to address the slow but consistent growth in demand for satellite based broadband telecommunications services.

The Canadian connectivity agenda is seen to be on track since all of the un-served/off-net communities except for one or two will have access to broadband telecommunications. The government's objective of breaching the digital divide has benefited significantly from the commercially subsidized price for terminals and the continuing downward pressures with respect to the monthly service charge. However, even if the price for high-speed Internet service to remote and rural subscribers is nearly comparable to the cost of similar services in Canadian urban centres, the business case for the provision of commercially viable services to these communities is yet to be made. Recent subsidies to provide remote communities with fibre-optic connectivity have reduced the number of off-net communities from an estimated 4200 to 1700, which enhances the community's access to broadband telecommunications but reduces the market potential for satellite-based services. For those communities that are still "off-net" and served by Anik F2 the connection is technically feasible. Programs such as NSI will provide connections for the public institutions; however, small private institutions in these remote communities may find broadband services still out of their price range for some time to come. Merging public and private utilization of a single set-top box (terminal) could be a solution but is currently not possible within the agreements made between the Canadian government and Telesat.

List of Acronyms

Acronym	Description
CSA	Canadian Space Agency
DOCSIS	Data Over Cable Service Interface Specification
DVB-RCS	Dignital Video Broadcast-Return Channel via Satellite
FTE	Full Time Equivalent
HQP	Highly Qualified Personnel
IF	Intermediate Frequency
NCR	National Capital Region
RF	Radio Frequency
SpaceMux	Space Multiplexer
TB	Treasury Board

Questionnaires

Generic introduction

As mentioned in the February 2005 letter signed by Marguerite Potvin of the Canadian Space Agency, an internal program evaluation is being conducted on the Payload Flight Demonstration Program. Your company contributed significantly to the successful development, launch and operational turnover of the Ka-Band Advanced Multimedia Payload on Anik F2. In addition to this system level success, the program had identified within the documents for approval several direct and indirect socio-economic objectives that were to evolve from the work performed within the contributions agreement and from the sales of products and services post launch. These had been based on projections made in concert with your company.
These latter socio-economic objectives as indicated by Ms Potvin are the focus of the study that I have been mandated to perform.
To perform an assessment of direct and indirect socio-economic benefits will require your assistance in gathering the necessary quantitative and qualitative data that only your company can provide. Your participation is therefore solicited to attain the high quality of data and information necessary for a credible report. The results of this assessment will be rolled-up into an overall program evaluation and presented to senior management as input to decisions related to future major space programs.
A set of questions has been developed based on the socio-economic objectives specifically mentioned within the government's decision making process for the Payload Flight Demonstration Program. It would be appreciated if you and possibly those from your company more closely involved with some of the targeted activities could take some time to review the questions in preparation for an interview that it is hoped could be arranged within the next two or three weeks. Participation of other members of your company is left to your discretion. A meeting is considered necessary given the anticipated qualitative nature of some responses and that some of the underlying assumptions to these will be easier to convey and understand. The proposed list of questions will provide a framework to address the required data and information elements; however, in responding to these questions, your views related to these or additional questions or on other matters related to the objective of this study will be sought.
The questions should be answered based on your company's activities related to the work performed under the contribution agreements between September 14, 1999 and July 17, 2004 and to any projected commercial sales and/or follow-on development activities for international programs.
The interview will take approximately 60 minutes, depending on how in-depth and substantiated the responses are.
I will contact you within the next week to set up a convenient time for the meeting. The results are required for the end of March.
The results of your interview will be kept confidential.
Your participation is greatly appreciated.

Appendix 1 to Annex A

Assessment of socio-economic impacts of
thePayload Flight Demonstration Program

Interview Guide for EMS

Respondent's Profile
Name	___________________________
Position Title	___________________________
Company	___________________________
Phone	___________________________
E-mail	___________________________

Questionnaire format

The following questions are grouped within two of the five categories of program impacts that have an economic/business underpinning. The terms used within the documents for approval are provided as a preamble to each of the questions or sets of questions for a specific element.

1. Employment: The program was expected to generate/maintain at least 208 person-year equivalents of direct employment over the five year period and that a vast majority of these would be highly skilled jobs in scientific research, engineering and related technical professions.

Q 1.1 From your company's financial/human resource tracking/accounting system or project related documentation is it possible to obtain a reasonably accurate compilation of the jobs created/maintained as a direct result of the work performed by your company for the Payload Flight Demonstration Program?

Q 1.2 In addition to the quantitative exercise of the above question, would it also be possible to get some appreciation of the "skill sets" developed/maintained within these jobs? The term "skill set" would be associated to those a company would likely use in advertisements for job opportunities or as titles of sections/groups of experts within the company. Some examples are Antenna, RF, Digital engineers/scientists, Spacecraft or Network systems engineers etc.

2. Commercialization: Several aspects of the payload represented firsts within the commercial satellite industry. This coupled with the early market entry and flight demonstration provided by the program was identified as an opportunity to enhance your company's ability to commercialize the related products and services. Estimates determined in concert with your company and incorporated within the December 1999 documents for approval were $35 M potential sales of SpaceMux and related technologies over the period to 2008.

Q 2.1 Using the Commercialization Plan delivered within the program as a base complemented with more recent information regarding current sales and future market trends what are the revised future sales forecast for the period to 2008 and what are the main contributors to the significant change if any. A response broken down by major market niches would be most appreciated.

Thank you for your time and contribution to this study.

Appendix 2 to Annex A

Interview Guide for COM DEV

Respondent's Profile
Name	___________________________
Position Title	___________________________
Company	___________________________
Phone	___________________________
E-mail	___________________________

Questionnaire format

2. Commercialization: Several aspects of the payload represented firsts within the commercial satellite industry. This coupled with the early market entry and flight demonstration provided by the program was identified as an opportunity to enhance your company's ability to commercialize the related products and services. Estimates determined in concert with your company and incorporated within the December 1999 documents for approval were $40M potential sales of BEAM*LINK and related technologies over the period to 2008.

Thank you for your time and contribution to this study.

Appendix 3 to Annex A

Interview Guide for Telesat

Respondent's Profile
Name	___________________________
Position Title	___________________________
Company	___________________________
Phone	___________________________
E-mail	___________________________

Questionnaire format

The following questions are grouped within three of the five categories of program impacts that have an economic/business underpinning. The terms used within the documents for approval are provided as a preamble to each of the questions or sets of questions for a specific element.

2. Commercialization: Several aspects of the payload represented firsts within the commercial satellite industry. This coupled with the early market entry and flight demonstration provided by the program was identified as an opportunity to enhance your company's ability to commercialize the related products and services. Estimates determined in concert with your company and incorporated within the December 1999 documents for approval were $1.25 billion of cumulative revenues from services offered by Telesat over the period to 2008.

3. Connectedness: The availability of a system like Anik F2 was stated as being critical to the success of the Connecting Canadians government agenda. It was also noted that many Canadians live in geographic areas that are off-net and that the Anik F2 Multimedia System would be designed to ensure that broadband/multimedia services was available to all Canadians.

Q 3.1 Based on the more recent market studies and related penetration strategies what in your opinion is the potential number of rural communities off-net that could benefit from the products and services developed and rendered operational within this program? This question seeks to identify the total number of off-net communities within the Anik F2 coverage.

Q 3.2 The Anik F2 multimedia system by design overcomes barriers such as low population density, remote locations, harsh climate and terrain and therefore can provide affordable high -speed services throughout Canada. Given the more recent exposure within this market niche; what do you consider are the remaining major hurdles for serving this market segment on a commercial basis?

Q 3.3 In your opinion roughly how many of these communities will be capable of procuring and utilizing your company's products and/or services by the year 2008?

Thank you for your time and contribution to this study.

ANNEX 2 - MANAGEMENT'S ACTION PLAN

Ref.	Recommendation	Responsibility		Details of the Action Plan	Deadline
		Organization	Authority
1.0 Planning of payload use and operation
To ensure that Canadians effectively benefit from the spin-offs of government programs, the CSA should, from the outset of programs, ensure that the financial resources are available for using the technologies developed. During the planning of programs concerning payload development, the CSA should ensure that the resources for operating and using them are available. If the level of funding is inadequate, the CSA should work with partners to develop and implement the necessary terrestrial infrastructures required to ensure the systems be used; hence Canada can fully benefit from the technologies developed by the CSA.		VP Science, Technology and Programs Space Technologies Policy, Planning and Relations		Space Technologies' Actions: In 2006/07, when CSA will create a new payload flight demonstration program (Anik G), Space Technologies will use an integrated approach, to comply with user's operational needs and Partner's and Users' engagements. In Program proposals, Space Technologies will consider life cycle costs of mission (R&D, development, operations and applications) in order to ensure a faster and optimal system utilization after the commissioning.	March 2007
2.0 Program performance measurement
In order to fulfil its responsibility and be accountable, the CSA should ensure that all program managers are aware of and assume their responsibilities regarding program performance measurement. Data need to be collected on an ongoing basis for the duration of the program. The data collected have to be analysed in order to take action in a timely manner and to ensure that program objectives are met efficiently.		VP Science, Technology and Programs Space Technologies		Space Technologies' Actions: Space Technologies develop for all its programs a management framework, logic model and performance measurement framework. Ongoing Data collection for program performance indicators will be done systematically in order to measure program performance and results.	Ongoing This is a part of the action plan includes in the audit report on Space Technologies dated September 2005.
The PFDP has to generate spin-offs for Canadians in the future. It is essential that CSA managers be accountable for the spin-offs. Partners need to agree on a mechanism to manage activities and measure performance and results.		Space Technologies		Space Technologies' Actions: Space Technologies managers are accountable for results and benefits to Canadians for the programs for which they have responsibility. For PFDP, Space Technologies managers will continue to track the program results and benefits with government and industrial partners, (annual studies) until the end of the governmental capacity credit for the Ka band payload.	Ongoing until 2014
3.0 Collaborative arrangement
Collaborative arrangements need to clearly set out the respective responsibilities of parties regarding performance measurement. In order to improve program management, the CSA should ensure that these collaborative arrangements comply with the CSA's policy, TB directives and that they: Clearly and quantitatively define the results to be achieved. Specify who is responsible for measuring results (whether the program's objectives have been met), measuring tools and the frequency of result measurement reports.		VP Science, Technology and Programs Space Technologies		Space Technologies' Actions: For further collaborative arrangements, Space Technologies will defined clearly the roles and responsibilities of each party and will include a detailed ongoing performance measurement framework.	Ongoing
4.0 Project management
The CSA and its representatives (CRC) should enter into technological assistance agreements required under ITAR, in order to ensure good management practices. They cannot properly manage programs if they are not provided with technological information. It becomes more difficult for them to fully exercise their roles as program managers.		VP Science, Technology and Programs Space Technologies Policy, Planning and Relations		Space Technologies' Actions: To avoid delay in programs, Space Technologies managers will ensure to obtain in a timely manner the technological assistance agreements. In order to do so, proactive role and fast actions from Policy, Planning and Relations Directorate and Foreign Affairs is essential. Policy, Planning and Relations: To avoid delay in programs, Space Technologies managers will ensure to obtain in a timely manner the technological assistance agreements. In order to do so, proactive involvement from Policy, Planning and Relations Directorate and Foreign Affairs is essential.	Ongoing

ANNEX 3 - ACRONYMS

Acronyms	Description
COM DEV	COM DEV International Ltd
CRC	Communications Research Centre
CSA	Canadian Space Agency
DSL	Digital subscriber line
EMS	EMS Technologies Canada Ltd
ITAR	International Trade in Arms Regulations
NSI	National Satellite Initiative
PFDP	Payload Flight Demonstration Program for Multimedia Payloads
SATCOM	Satellite communications
TB	Treasury Board

ANNEX 4 - BIBLIOGRAPHY

Websites

ASC. 2004. Lancement réussi du satellite Anik F2 de Télésat Canada. Accédé le 19 janvier 2005. Disponible sur www.asc-csa.gc.ca/fra/satellites/anikf2.asp.

ASC. 2004. Augmenter la flexibilité et la performance des satellites de télécommunications. Accédé le 25 février 2005. Disponible sur www.asc-csa.gc.ca/pdf/tech-success_stories_f.pdf

Canada Industrie. Novembre 2003.The New National Dream: Networking the Nation of Braodband Acces, accédé le 12 avril 2005. Groupe de travail national sur les services à large bande. Disponible sur http://broadband.ic.gc.ca/pub/program/NBTF/broadband.pdf

Canada, Industrie. Février, 2004. National Satellite Initiative (NSI)- Round two Report on Industry Canada Consultations with Satellite Service providers & Satellite Operators. Accédé le 14 février, 2005. Disponible sur broadband.ic.gc.ca/pub/program/nsi/reports/consultations/nsi_consultations_report_en.pdf.

Canada, Statistiques. Division des sciences, de l'innovation et de l'information électronique, documents de travail. Accédé le 15 février 2005. www.statcan.ca/cgi-bin/downpub/listpub_f.cgi?catno=88F0006XIF,

Canada, Statistiques. Série sur la connectivité Internet par cable. Accédé le 10 février 2005. Disponible sur www.statcan.ca/francais/research/56F0004MIF/56F0004MIF2001002.pdf.

Canada, Statistiques. 2000. Les temps changent : pourquoi et comment les Canadiens utilisent Internet. Accédé le 15 février 2005. Disponible sur www.statcan.ca/francais/research/56F0006XIF/56F0006XIF2000001.pdf

Canada, Statistiques. 3 septembre 2002. Service Internet à haute vitesse par cable, 20001. Accédé le 7 février 2005. Disponible sur www.statcan.ca/Daily/Francais/020903/q020903a.htm.

Canada Statistiques. La fracture numérique au Canada. Accédé le 15 février 2005. Disponible sur www.statcan.ca/cgi-bin/downpub/listpub_f.cgi?catno=56F0009XIF

Canada, Télésat. Automne 2004. Rapport, Bulletin d'information sur les télécommunications par satellite de Télésat Canada. Accédé le 15 février 2005. Disponible sur www.telesat.ca/news/releases/2004/index-f.asp,.

Canada, Télésat, 2005, Accédé 21 février 2005. www.telesat.ca/home-f.asp

Autochtones au Canada. 5 mai 2004. Rapport 2003 sur l'infrastructure de connectivité des collectivités autochtones. Accédé 15 avril 2005. Disponible sur www.autochtonesaucanada.gc.ca/acp/site.nsf/fr/ao28080.html

Documents

Industrie Canada. Un partenaire indispensable 2003.

¹ Networking the Nation for Broadband Access, Industrie Canada,2003
² Connectedness Series 2003, Industry Canada
³ www.asc-csa.gc.ca
⁴ State of the Canadian Space Sector 2004 (CSA)
⁵ Satellite Communications Market Trends 2004 (CSA)
⁶ Web site: http://www.lincsat.com/DocsMKT/TelesatKa-bandPricingNews-E.pdf

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Evaluation report