BEDMINSTER, NJ - June 2, 2004 - Loral Skynet today announced that SkyReach(SM), the company's Internet Protocol (IP) enabled service that provides two-way broadband services for secure private networks or high-speed Internet access, is now commercially available throughout the Americas.

"With SkyReach, enterprises and specialty service providers that need to reach multiple locations, whether in well-served or remote areas, will benefit from the reach and service quality of Skynet's IP-based network over satellite," said Terry Hart, president, Loral Skynet. "In addition to general communication service providers, Skynet is working with enterprises in the healthcare, petroleum, and finance industries to provide two-way high-speed services among these industries' multiple, geographically dispersed sites."

Skynet has begun providing its SkyReach IP-enabled services to customers, including:

• Vox2Healthcare, Deerfield Beach, Fla.: Skynet has reached an agreement to provide an up to 1000-site IP-based SkyReach network that will allow Vox2Healthcare to offer virtual consultations, telemedicine and care management applications to medical facilities in North America.
• Government Service Integrator based in the United States: Skynet has developed a SkyReach network that utilizes innovative unicast and multicast features over the Internet, enabling a clear communications channel between military bases in North America.

SkyReach Release 1.0

Using very small aperture terminals (VSATs), SkyReach allows organizations to create an instant infrastructure for a network that can connect offices within a city or around the globe. SkyReach supports C-, Ku- and Ka-band frequencies, offers better throughput and efficiency than current VSAT networks (2 Mbps forward link; 512 Kbps return) and allows end-users to select from a choice of on-site equipment to meet their specific networking needs, such as satellite interactive terminals supporting different data rates and networking features.

SkyReach Release 1.0 offers services that complement existing frame relay and multi-protocol label switching (MPLS) networks and enables efficient network management. SkyReach is optimized to provide a common platform on which to converge data, voice and video requirements onto a single secure IP network. SkyReach Release 2.0, scheduled to be introduced later this year, will add improved routing features for attached local area networks, higher data rates, and enhanced quality of service management features.

SkyReach supports current IP-network services including:

• Private networks
• Frame-relay/MPLS backup and remote connectivity
• Managed data services
• Thin client/ASP edge caching (at the terminal)
• Internet/intranet access
• Bandwidth on demand
• Always-on broadband connectivity

SkyReach can enable new, IP-based services, including:

• Video point of sale (POS): In-store advertising and movie preview kiosks, for example
• Supervisory control and data acquisition (SCADA)
• Large-file transfer
• Videoconferencing and two-way interactive services
• Broadcast and multicast services
• Audio and video distribution (e.g., streaming, video on demand, customer kiosks)
• Voice over IP (VoIP)

SkyReach, which operates over the IA-7 (formerly Telstar 7) satellite in North America and Telstar 12 in Latin America, is scheduled to roll out in Europe and Asia later in 2004.

A pioneer in the satellite industry, Loral Skynet continues to deliver the superior service quality and range of satellite solutions that have made it an industry leader for more than 40 years. Through the broad coverage of the Telstar satellite fleet, and in combination with its established hybrid VSAT/fiber global network infrastructure, Skynet is a source for all broadcast, data network, Internet access, IP and systems integration needs. Headquartered in Bedminster, New Jersey, Loral Skynet is dedicated to providing secure, high-quality connectivity and communications. For more information, visit www.loralskynet.com.

In addition to being the parent company of Loral Skynet, Loral Space & Communications (OTC BB: LRLSQ) is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications through its Space Systems/Loral subsidiary.

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, Loral Space & Communications Ltd. or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made by the company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. These factors include those related to the filing, on July 15, 2003 by Loral and certain of its subsidiaries, of voluntary petitions for reorganization under chapter 11 of title 11 of the United States Code in the United States District Court for the Southern District of New York and parallel insolvency proceedings in the Supreme Court of Bermuda in which certain partners of KPMG were appointed as joint provisional liquidators. Additional factors and conditions are also described in the section of the company's annual report on Form 10-K for the fiscal year ended December 31, 2003, entitled "Commitments and Contingencies," and the company's other filings with the Securities and Exchange Commission. The reader is specifically referred to these documents