Profile | Don Thoma, Chief Executive, Aireon

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The disappearance of Malaysian Airlines Flight 370 en route from Kuala Lumpur to Beijing has been met with a global reaction of surprise that in today’s connected world, a Boeing 777 can simply drop out of sight.

Such an event will be far less likely starting around 2018 after the launch of 72 Iridium Next second-generation mobile communications satellites into low Earth orbit. Following investment by Canadian and European air navigation service providers, Iridium’s Aireon spinoff now has all the money it needs to assure that Aireon automatic dependent surveillance-broadcast (ADS-B) transponders are aboard all Iridium Next satellites.

The Aireon service uses GPS positioning, navigation and timing data to track aircraft worldwide, regardless of whether they are over large land masses or in midocean, where there are no terrestrial ADS-B towers.

Aireon’s main value proposition to airlines and air traffic authorities is not in keeping aircraft positions up to date in the event of a mishap, but in permitting airliners to fly more-efficient routes, and fly more closely spaced in air corridors, to save fuel and time.

This is the key to Aireon’s business model, and the reason the company is so confident that as the Iridium satellites approach their launches starting in 2015, Aireon will be a standard service worldwide. 

Aireon Chief Executive Don Thoma spoke about the company’s status and prospects to SpaceNews staff writer Peter B. de Selding.

If Aireon were operational today and Malaysian Airlines Flight 370 was equipped for the service, what would we know about that flight that we don’t know now?

Almost all new aircraft are equipped with ADS-B transponders following government regulations. For example, the European Union has mandated that by 2017, all aircraft — new builds as well as retrofit — must be fitted with ADS-B transponders.

The U.S. Federal Aviation Administration has a similar mandate, for new builds and retrofits by 2020. Other nations, such as Singapore, are in the process of evaluating and putting those mandates into place.

So the world standard is moving to ADS-B. Essentially, ADS-B technology takes GPS information off the airplane, and automatically transmits the information over a dedicated frequency to towers. That means that the coverage is currently limited to places where there are towers.

The U.S. will complete deployment of 650 towers this year, with Exelis, as part of a ground-based system for the continental United States.

Can these ADS-B towers piggyback on existing towers?

Yes, and they do. They share existing towers with cellular network providers and others to deploy the system. However, these networks end when you hit the oceans or other remote areas where ground-based infrastructure doesn’t exist. 

Over the oceans there is very limited coverage — only around the coasts, where there are deployed towers.

This is where Aireon comes in?

Yes. Through Aireon, if any aircraft is equipped with ADS-B transponders, Aireon will pick up those signals, wherever they originate. Between 2018 and 2020, the majority of all oceanic aircraft, given where they fly, should be equipped with ADS-B transponders.

So to take the example of the Malaysian flight, Aireon would be able to receive the last transmission of a functioning ADS-B transponder through a space-based surveillance capability. 

If the aircraft had a sudden impact or other traumatic event, you would see a sudden stop in the regular flow of positioning data?

Yes. If the transponder is disabled, whether it is due to an electrical problem on the aircraft or in the case of a tragedy, that ADS-B signal stops transmitting location data. However, Aireon would be able to gather near-real time, precise, GPS-based location information up until the time the transponder was disabled.

So for a midocean event, we would be able to pinpoint the area of impact?

That’s correct. You recall that on the Air France 447 flight from Rio to Paris in June 2009, the issue was that while the pilot was reporting back its last position, they were only required to report, on average, every 10 minutes.

A plane flying at 500 or 600 miles [800 or 960 kilometers] per hour covers a lot of distance over 10 minutes. That’s why these search areas are so large. With the Malaysia flight, the question becomes: What was the last transmission by a radar transponder, what is the uncertainty of the location of the aircraft, and how does that impact the potential search area? With Aireon’s real-time surveillance, we will be able to identify the specific location of the last ADS-B transmission, resulting in a dramatically reduced search area.

Are pilots able to switch off the ADS-B transponders being fitted onto aircraft, or are transmissions independent of decisions in the cockpit?

ADS-B transponders are part of the avionics of the aircraft, and the cockpit does have the ability to turn those systems off as they would with a radar transponder or any other avionics today. 

Aireon was born in Iridium and its second generation of satellites, 72 of which are to be launched starting in 2015. Then you got Nav Canada as a partner. Describe your current investment group.

The original joint venture was between Iridium Communications Inc. and Nav Canada, the operator of Canada’s air traffic control system. Nav Canada committed to investing $150 million in Aireon, for 51 percent of the company based on various developmental and deployment milestones. 

To date, they have made the first two investments for a total of $55 million and there are more investments that are pending. The more recent announcement was the commitment to invest another $120 million by the three ANSPs, or air navigation service providers, of Ireland (IAA), Denmark (Naviair) and Italy (ENAV). The first tranche of $50 million has been committed.

All three of these are corporate entities that have been designated national ANSPs?

They are corporatized, so at least partly owned by the government, but have the authority to charge fees and so on. They fund their own investments and so they do not rely on the treasuries of those countries to fund their business operations or any capital investments.

Where are you with the Asian ANSPs?

There have been many discussions, predominately focused on the airlines. We have an agreement with the International Air Transport Association with which we have formed an advisory committee for airlines. Lufthansa, Delta, Air Canada and Cathay Pacific have been appointed as airline participants.

This clearly applies to all oceanic airspace and remote airspace. We’ll be making some announcements soon about what we’re doing for some continental airspaces regarding the use of Aireon to provide capabilities there. 

Asian carriers want this as well, for obvious reasons. North Atlantic air traffic is forecast to grow approximately as fast as gross domestic product — 2 percent, 3 percent per year. The big growth in air traffic is in Asia. The Middle Eastern airlines are also making significant investments. 

For these increasingly populated air corridors, the question is: How do you make the airspace, the air lanes, more efficient? How can you put more aircraft safely into a given air lane? 

With our investors, a lot of the work has been focused on the North Atlantic to start. We’re now expanding that effort to the Asian air traffic control authorities, discussing how to provide service in their airspace as well.

Whose job is it to lead these discussions — Nav Canada’s or Aireon’s?

There are two aspects of it for the North Atlantic. We’re the commercial entity that will be selling the service and the capability. But in the North Atlantic, since Nav Canada is a member of the North Atlantic Systems Planning Group, which is part of the International Civil Aviation Organization (ICAO), the air traffic control authorities get together to determine how best to coordinate air traffic flow across the North Atlantic. It includes the FAA.

They’re responsible for putting into place the appropriate regulations to make these changes to use space-based ADS-B, and to generate the efficiencies made possible by real-time surveillance. That feeds into the whole ICAO process.

Canada is working on its own behalf as a manager of the North Atlantic airspace with NATS in the U.K., with Denmark for Greenland, and with Portugal. So there is a very important state-to-state collaboration that needs to occur to implement space-based ADS-B. 

It’s about how to use space-based ADS-B to incorporate these improvements in air traffic efficiency, all based on analyses of regional safety requirements.

Where is the FAA with Nav Canada on space-based ADS-B?

The FAA and Nav Canada signed a bilateral agreement last year to cooperate on the implementation of space-based ADS-B in the North Atlantic. Part of this collaboration includes working together on the ICAO regulatory process.

In November 2012, ICAO’s air navigation commission recommended that space-based ADS-B be included as part of the organization’s global air navigation plan, and built it into the process for implementation. Then last November, the ICAO assembly met and approved its adoption. That step initiates the whole process of how to integrate space-based ADS-B in the North Atlantic and other regions.

So it starts with the North Atlantic. But very quickly, we’ll start working with the other regions on how to use the service.

Are Boeing and Airbus line-fitting ADS-B into all their aircraft even though some regions have not yet set the requirements?

That has already been decided. The mandates of the United States, Europe and Australia were not global, but those ANSPs manage a significant amount of airspace. Therefore, aircraft manufacturers are equipping all new aircraft with ADS-B transponders. 

No new equipment is required for the airlines to support space-based ADS-B. That is why the airlines are so supportive, why the International Air Transport Association has formed this committee with us on space-based ADS-B, and why U.S. airlines have written the FAA administrator in support of the program. Airlines have already made the investment in the equipment, and the arrival of Aireon in 2018 gives them an immediate return on that investment.

Your financial obligations to Iridium over time are sizable — some $600 million. Is that going to be a monkey on your back? 

Our financial obligations are based on a clear business model put together by Nav Canada, which had to get the approval of its board, which includes the airlines. The Aireon value proposition is clear. If the ANSPs can make some fairly simple modifications to the way aircraft fly over the oceans — for example, letting them climb a couple of times to reach a more flight-optimal altitude as they burn fuel — then they can save 1-2 percent in fuel consumption per flight.

Going across the North Atlantic, that is equivalent to 450 liters of fuel on average. To provide this benefit, Aireon will charge a fraction of that savings as a fee to the air traffic control organizations. The air traffic control organization would then pass that fee on to the airlines.  However, the savings far outweighs the cost. The airlines would get approximately a threefold fuel savings benefit in exchange for that increased fee. It’s a win-win for everybody.

The fees from Aireon to Iridium are compensation for the $3 billion investment that Iridium is making in its second-generation Iridium Next constellation. Aireon payloads will be deployed on each of the Iridium Next satellites, so we’re essentially paying for our ride to space. 

Second, Iridium will be delivering the data back from airspace areas around the globe, resulting in a recurring data services fee that will be paid for by Aireon; another piece of the $600 million.

Third, our ANSP partners expressed a desire eventually to own 75.5 percent of Aireon’s equity. This results in buying back shares from Iridium to reduce Iridium’s ownership. The final outcome is more than $100 million in payments to Iridium so ANSPs will ultimately own a larger slice of the Aireon pie.

What are your 2014 milestones in terms of Asian or Middle Eastern airlines that are important?

There are no essential decision points this year for the Asian air traffic control authorities. Our main role is to bring them up to speed on what we are doing. Aireon is going to launch next year on the first Iridium Next satellites to be deployed, and will continue until the full constellation is complete in 2017. We expect to have some initial data coming in as early as next year, so our real task is to begin educating the rest of the world.

Do you have sufficient resources now to assure that all the Iridium Next satellites will be equipped with the ADS-B payload?

Yes, with the investments by Nav Canada, IAA, ENAV and Naviair, Aireon has the capital needed for deployment. This includes building 81 space-qualified ADS-B receiver payloads through our provider, Harris Corp. The ground system, which is being built by Exelis, is also financed. With this system, the data comes down from the satellites and gets sent through the Iridium ground network. 

Exelis is the prime contractor and system operator for the FAA’s U.S. ground-based ADS-B system, so they are well-positioned to build the Aireon data processing centers. The same facilities will have the network operations center, the data servers, etc., that process all the space-based ADS-B data, plus all the service delivery points where you deliver the data to the U.K., to Nav Canada, to Denmark and so on, for use in air traffic control.

There is no material capital expenditure required as you add participating ANSPs and the system gets the global acceptance you expect?

No. It’s small. The cost would be additional servers to manage their service delivery point. 

The good news is the new investments we announced in December and closed in February will provide Aireon with all the funding it needs to deploy a system on every single Iridium satellite that’s going up.

 

Follow Peter on Twitter: @pbdes