2008: This was a strong year for Spacenet and we experienced our best performance ever since the company’s inception 27 years ago. We deployed thousands of VSATs across our core markets, launched multiple new product and technology introductions, and formed new strategic programs and alliances with leading companies in the industry.

Over the past few years, Spacenet has focused on re-invigorating itself through growth and innovation. It remains focused on its core enterprise customers, and has expanded into new markets including government, industrial and gaming/lottery, where the fundamental operations are dependent on highly reliable networking. We are focused on being the high-performance provider in our industry by offering higher quality services backed by a strong focus on customer care. Our satellite and hybrid network services enable companies ranging from Fortune 500 enterprises to small remote industrial operations to benefit from the latest in converged data, voice and video communications. We offer a combination of scale and stability to provide world-class service with flexibility to cater to customer needs.

As we continued our long tradition of pioneering new technologies and services and contributing to the overall health of the satellite industry in 2008, we also continued to adapt to a rapidly changing competitive landscape. Over the years, organizations have transitioned from using satellite primarily for narrowband networks to using it for fully converged communications to support data, voice and video. It is increasingly being used for network backup and business continuity for non-stop networking. To further enhance ROI, organizations are realizing a dual-use benefit, simultaneously using the satellite network to support multicast content distribution and as a backup service in the event of a primary network outage.

Spacenet highlights of 2008 included:

Advanced Network Security and PCI
Spacenet enhanced its infrastructure in support of PCI DSS compliance across both its satellite and wireline network services product lines in order to provide customers with the utmost level of confidence in the safety and integrity of their networks. PCI compliance provides an additional layer of confidence to customers in the retail, hospitality and financial services industries. Spacenet’s PCI-compliant network architecture helps companies meet the requirements and ensures a secure managed application routing environment.

Launch of Digital Signage Alliance
Digital media applications are increasingly being used by organizations to increase revenue opportunities and improve efficiencies. In 2008, Spacenet launched a digital media alliance program with strategic partners to offer integrated digital media services to enterprise customers. The alliance program unifies the different components of digital media applications, including content creation, management and distribution into a single solution for the end-customer. This program enables customers to leverage the benefits of satellite as a consistent, reliable and efficient content distribution solution. In addition, it provides new options in digital media solutions with an overall simplified implementation and management process.

Launch of International Satellite Services
Spacenet launched international VSAT services in 2008 as part of an expansion initiative to support both commercial and government clients. Through a strategic alliance with Globecomm Systems Inc., the two companies provide a trusted reliable US based network that helps improve the operational efficiency and mitigate some of the communication risks of international operations. Features of the service include:

• Coverage to select countries in Europe, the Middle East and Africa
• Operated through Spacenet’s self-operated infrastructure
• Designed for US-based multi-national corporations and government agencies
• Customer data lands in a secure US teleport outside of Washington D.C.

New Rapid Deploy Satellite Communications
To expand the reach of truly viable and cost-effective solutions for disaster recovery and rapid deployable communications to new markets, Spacenet launched its new ION instant communications kit. The package provides a full range of high performance communications services, including direct connection to the public switched telephone network (PSTN), high-speed broadband Internet access, and support for two-way video conferencing or surveillance — all through a commercial grade satellite network. Features include:

• Self-contained and ruggedized field kit that is easily carried by one or two people
• Rapid deployment of complete converged communications via satellite
• Ideal for emergency response and remote industrial operations

Expanded Portfolio of High-Performance Connexstar Services
Spacenet expanded the reach of its pre-packaged commercial grade Connexstar satellite communications services in 2008 with new offerings in Alaska and Hawaii. The services enable customers in these regions to benefit from reliable business-grade broadband services, previously not available in many remote areas of these states.

Spacenet also increased the speed of its commercial grade Connexstar Performance Series service to include a 5 Mbps (mega bit per second) option -- making it among the fastest pre-packaged satellite communications solutions available. Features of the service include:

• Supports fully converged voice, video, and broadband data communications
• Comes with the industry’s only Minimum Assured Speed
• Available in both full-time and part-time service plans

2009: Overall, 2008 was a very successful year for Spacenet, and we are optimistic about the future. The value proposition of satellite has not been fully exploited, and new lines of business and new markets will provide opportunities for growth for us and our competitors.

Digital media is one market that we anticipate growth in for satellite communications. The market is still in its early stages and satellite offers numerous advantages in support of digital content distribution. Through our Digital Media Alliance, Spacenet plans to help customers, including retail, healthcare and financial organizations, leverage the full benefits that digital media applications offer.

We also see the government market as a key growth opportunity. Federal agencies as well as civilian agencies, like the USPS®, a current Spacenet customer with 5,000+ sites, benefit from using satellite as a primary network for remote locations, backup network for Continuity of Operations, and as a transportable solution for emergency response. In 2008, Spacenet expanded coverage of its satellite services to numerous government agencies in support of emergency communications networks.

Another growth opportunity is the industrial market, including energy, construction, and forestry. Satellite communications have a very high value proposition in this market, providing a highly reliable and secure networking solution for remote locations and mission-critical applications.

Spacenet is focused on leveraging our technology advantages in order to deliver reliable satellite and hybrid network services, innovative application solutions, and sophisticated network management support that meet the needs and exceed the expectations of our customers’ evolving requirements. We will continue to leverage our unique combination of operational excellence and high-touch customer intimacy model to provide business and government organizations a strong level of trust. We are proud of our achievements in 2008 and look forward to a future of continued innovation. We look forward to continuing this successful track record to bring the advantages of satellite communications to even more industries and markets in 2009 and beyond.

About the author
Prior to joining Spacenet in 2005, Mr. Katz was with StarBand Inc. where he held the positions of acting Chief Executive Officer, Chief Information Officer, and Vice President of Sales. Prior to joining StarBand, Mr. Katz was with Gilat Satellite Networks for over 11 years and held several executive roles in both the Tel-Aviv headquarters and Florida subsidiaries. He started his career with Gilat in the R&D department in Israel before becoming VP of Product Development for SkyData Inc., a wholly owned Gilat subsidiary in Florida. Following this, Mr. Katz helped launch Gilat Latin America, Inc. and served as the Chief Technical Officer and VP of Operations. After that he returned to Gilat headquarters in Tel-Aviv in the role of VP of World Wide Customer Services. Before joining Gilat, Mr. Katz worked with Digital Transmission Systems, and Scientific Atlanta as a design and development engineer.

About the company
Founded in 1981, Spacenet Inc. is a leading provider of wireless and hybrid terrestrial broadband services for enterprise, government and home/small office customers in the United States and worldwide. Spacenet serves nearly 100,000 network endpoints with its Connexstar™ commercial-grade WAN solutions for retail, energy, financial services, hospitality and government customers; and its StarBand® Internet access service, the pioneer in two-way broadband VSAT. Spacenet also provides specialized VSAT-based solutions for disaster recovery, business continuity, remote and mobile communications needs. Spacenet is based in McLean, Virginia, and operates its own end-to-end services infrastructure including network management, field services and earth station facilities in Washington, D.C.; Atlanta, Georgia; and Chicago, Illinois. Spacenet Inc. is a wholly owned subsidiary of Gilat Satellite Networks Ltd. of Petah Tikva, Israel. Gilat (Nasdaq: GILT) was founded in 1987 and is one of the world's leading providers of two-way, satellite-based communications networks based on Very Small Aperture Terminal (VSAT) technology. Gilat has shipped nearly 650,000 VSATs worldwide.