Teledesic, the satellite broadband project co-founded by Bill Gates which plans to offer satellite internet access services by 2005, last week announced its first satellite manufacturing deal.

Alenia Spazio, an Italian company that has built satellites for other service providers, including Globalstar, will be working with Teledesic. Alenia beat Lockheed Martin to gain the contract.

According to the company, Teledesic is "designed to support millions of simultaneous users… [who will,] using 'standard' user equipment, have two-way connections that provide up to 64Mbps (megabits per second) on the downlink and up to 2Mbps on the uplink".

Alenia Spazio will build the first two of Teledesic's 12 satellites that will be launched sometime between now and 2005, according to a company spokesman.

But Teledesic has not publicly stated when its first satellite is scheduled to be rocketed into orbit.

Teledesic says it will likely work with a number of satellite manufactures to build its entire constellation of satellites, which are expected to total 30 when the network is complete.

The company is backed by some big names in wireless and software, including mobile telecoms all-rounder Craig McCaw, Bill Gates, Saudi Prince Alwaleed Bin Talal, Boeing and The Abu Dhabi Investment Company.