The joint venture will be named Horizons-2 and include a high-powered satellite that will support everything from digital video, high-definition television (HDTV) and IP-based content distribution networks to broadband Internet and satellite news gathering services (SNG).

Joe Wright, CEO of PanAmSat, said, "The market in the U.S. for HDTV and IP video, as well as broadband Internet services, is developing into the strongest in the world, which makes it highly attractive for PanAmSat to add capacity and take advantage of this growth opportunity. Our collaboration with JSAT goes back to 2001 when we formed our joint venture called 'Horizons.'

"This new stage of our partnership now enables us to secure funding for the new satellite, and obtain capacity for future growth, without increasing our planned capital expenditures, and we fully expect that the investment we are required to make after the expected launch date of the satellite will be covered by our share of the revenues from the satellite. This satellite, and other ventures similar to this, will play an important role in our future expansion."

PanAmSat has already developed a strong concentration of video broadcast, SNG and occasional use services for its broadcast customers at the 74 degrees west longitude location. The Company originally planned to continue providing these services on other satellites when the existing satellite, SBS-6, was to be deorbited.

"The stronger than expected market, coupled with growing demand from our existing customers, changed our minds. This is a "win-win" for both companies and we look forward to building the value of this orbital slot with our partner JSAT," said Wright.

The orbital position of this satellite is part of PanAmSat's unique North American Galaxy video services neighborhood catering to its premier customers.

The formation of the venture with JSAT, which is on a 50/50 basis, will permit PanAmSat to replace the satellite with no capital outlays during the two-year construction period and to make its part of the $140 million investment on terms that are significantly better than its current cost of financing.

The venture compensates PanAmSat for the use of the slot, sales made by PanAmSat and other services PanAmSat will provide with the payment of fees and increased shares of the revenues.

"Given that our relationship with PanAmSat on Horizons-1 was such a fruitful endeavor, we have been exploring new avenues in which our two companies could grow. JSAT is always looking for opportunities to serve our customers and Horizons-2 affords us just that type of opportunity," said Kiyoshi Isozaki, president and CEO, JSAT. "We look forward to the continued success of our joint venture."

The PanAmSat/JSAT partnership on Horizons-1 was the first of its kind, uniting a non-U.S. company with a domestic one to provide reliable satellite capacity over the North American market with connectivity to Japan, especially for VSAT and data applications.

Now, as the two companies enter a new arrangement, PanAmSat will provide a proven infrastructure in the growing North American market with its premium orbital slot, sales expertise and robust teleports while JSAT will provide the new venture with financing for the project.

The partners expect to complete satellite and launch services procurement in the near future and to deliver a new, high-powered satellite in service by late 2007.

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