UPDATE 1-Arianespace launches "largest commercial satellite"

* TerreStar-1 largest commercial comms satellite-Arianespace

* Estimated cost satellite, launch, insurance over $500 mln

(Adds details)

By Laurent Marot

CAYENNE, French Guiana, July 1 (Reuters) - An Ariane rocket has launched from French Guiana on Wednesday the TerreStar-1 satellite, billed by the Arianespace rocket launch company as "the largest commercial communications satellite ever launched".

TerreStar blasted off from the European Space Agency's (ESA) launch centre in Kourou, French Guiana on the northeast coast of South America at 2.52 pm (1752 GMT).

It was released into orbit twenty-six minutes later.

Virginia-based TerreStar Corp TTSR.O plans to provide hybrid telecommunications to satellite and cellular handsets about the same size as a conventional smartphone.

The satellite is designed to provide service throughout the United States and Canada. Analysts estimated the cost of the satellite, launch and insurance to exceed $500 million.

TerreStar weighed 6.9 metric tonnes (15,200 lb) at lift-off and was built by U.S. satellite manufacturer Loral Space & Communications Inc (LORL.O).

The current Ariane-5 rocket series is capable of launching payloads of up to 10 tonnes. The company plans to expand its launcher fleet with the introduction next year of Russian Soyuz rockets to be launched from the Kourou base.

Arianespace is 30 percent owned by European aerospace giant EADS (EAD.PA).

Wednesday's launch was the 31st consecutive successful mission for Paris-based space transport company Arianespace. (Additional reporting by Alexander Miles; Editing by Louise Ireland)