WASHINGTON — Not so long ago, satellite operators treated inflight connectivity as a niche market — a good way to sell off capacity not already soaked up by more lucrative television broadcast, government and maritime customers.
Fast forward to today, and it’s nearly impossible to listen to satellite operator executives discuss their future plans without emphasizing the aviation market.
That prioritization makes sense since its was inflight connectivity companies Gogo, Global Eagle Entertainment and Panasonic Avionics that were some of the first in line to secure loads of capacity on new high-throughput satellites (HTS) before they launched. Joining their ranks is Thales Inflyt Experience, a division of European aerospace giant Thales formed in 2015 to aggregate its inflight entertainment and connectivity (IFEC) businesses, including those gained from the $400 million acquisition of JetBlue subsidiary LiveTV in 2014.
Since last year, Thales Inflyt Experience has secured capacity on four Ka-band satellites — Hughes’ EchoStar-17 and EchoStar-19 satellites and SES’s AMC-15 and AMC-16 satellites — for FlytLive, the company’s Americas-focused aeronautical-connectivity solution. The company also signed up to be SES’s anchor customer for SES-17, a 200-spot beam Ka-band satellite that SES describes as a “Very High-Throughput Satellite,” slated for launch in 2020. Thales Alenia Space is building the satellite.
Jeff Goodman, director of connectivity product line management for Thales InFlyt Experience, said the company already has a global install base of 2,400 inflight entertainment, or IFE, systems, forming a sizeable base of easy prospects for FlytLive connectivity when the service launches later this year.
“Do we have upgrade paths with those customers? Absolutely. There is potential for upgrades to connectivity wherever we have IFE customers,” he said.
The U.S. Federal Communications Commission okayed Thales FlytLive aeronautical terminals in July for U.S. useage, affirming access to the largest and most contested IFEC market in the world. Thales FlytLive targets aircraft in the Americas; for the rest of the world Thales uses Inmarsat’s Ka-band Global Xpress network. Satellite partners Inmarsat, Hughes and SES are all integrating Thales InFlyt Experience ground equipment to form a global ground network to pair with their satellite services.
Goodman spoke to SpaceNews about Thales’ ambitions in the IFEC space.
The U.S. is the most crowded IFC market in the world. What’s going to give Thales a competitive edge there?
We feel that it is a highly competitive market, but there are unmet needs, and we are planning for the longer term with this solution: how we are going to meet those growing demands in the market. Bandwidth consumption is skyrocketing, the number of users on the system is increasing — it’s going to take a lot more capacity as time goes on. We designed our solution for that long-term solution, looking towards the future.
And what is that long-term future you envision? In five to 10 years, what will IFC look like?
Bandwidth requirements per passenger are going to continue to increase. People will be more and more expecting connectivity onboard the aircraft. They are going to expect it to work as it does at home, and so there will be less tolerance for subpar solutions. We as an industry need to be able to meet that need, and we are positioning to do that with FlytLive.
How did Thales’ experience in IFE seatbacks evolve into inflight connectivity?
From where I sit, we started as an IFE company and had pretty strong growth over the last several years, but the trend that we’ve seen and that everyone has seen in the market is that connectivity started becoming a request more and more frequently, even attached to IFE [requests for proposals] from customers. It started slow, but now we are seeing the majority of RFPs coming through requesting IFE and connectivity.
We had started working with other partners to be service providers for connectivity, but as we saw it growing at the rate it’s growing today and as we understood the need to provide best of class solutions for our customers, we started making more and more investments for connectivity.
IFC companies have been known to say it’s easy to make money in this segment, but not necessarily a profit. What convinces you this can be a profitable business?
In this business in general it is definitely a huge benefit to have complementary businesses such as IFE with connectivity. The entire market is figuring out the perfect balance of business models for connectivity and IFE. We definitely have a strong position in that Thales is a major integrator of [avionics] systems and we are bringing together best in class connectivity with our IFE systems, with added services such as cybersecurity on top of both of those.
Do you have customers pre-committed to Thales FlytLive?
We are working very closely with our launch customers. We are not able to announce those yet.
Why did Thales decide to invest so heavily in Ka-band? Other major resellers (Gogo, Panasonic, GEE) have all gone Ku.
There are a number of benefits with Ka-band. One is the amount of spectrum that’s available. There is a lot of room for growth in the spectrum as we continue to expand in this market and as we evolve. There is a lot of growth that will be happening in Ka-band as well as some technical reasons why you can get a little bit more performance out of Ka-band versus Ku.
FlytLive is a regional solution which will be good for domestic fleets in the Americas, and we will continue to offer Global Xpress for the rest of the world and for widebody aircraft. You can imagine a scenario where you have the domestic fleet of an airline with our regional solution, and then the global wide-body fleet of the same airline could be on Global Xpress. We would use them as complementary services.
Regarding the international market, what are you thoughts on approaching that space? Will you add capacity in other parts of the world, too?
For now this is an Americas solution: North and South America.
What kind of antenna and modem equipment are you working on for FlytLive?
We are internally developing our next-generation satcom systems for the FlytLive solution using other businesses within Thales.
I’m assuming you already have an antenna completed if service is to roll out later this year?
We are in the final stages of our development and qualification to be delivering this year.
What are the specifications you anticipate?
The real key driver for us is to be able to offer streaming to every single passenger on the aircraft. That is the benchmark we are setting: the ability to stream to every single passenger on the aircraft. We will be adding capacity as needed to do so.
How do you define Very High-Throughput Satellites (VHTS)?
High spot-beam density, high frequency re-use, and very high data rates. For our FlytLive solution, it is primarily developed for aviation. That means that the high-throughput spot beams are being configured for flight routes, providing greater capacity where there is greater density. The network will also be able to dynamically allocate bandwidth, further ensuring capacity requirements are met. We expect it to be a better performing system than anything that is out there.
There is a big debate over the merits of leasing versus owning satellites. Thales is leasing capacity from several sources, including one that has advocated for ownership (Inmarsat). What are your thoughts on this debate?
Thales believes the managed-service approach is best approach for the commercial aviation market. Our partnerships with satellite providers allow us to deliver and pay for only the capacity that is needed. This approach delivers the best performance and economics for the airline and provides flexibility to adjust to market changes.
What are your thoughts on air-to-ground connectivity?
There are limitations in the geographic regions for air-to-ground that can be supported. With our FlytLive satellite network solution, we cover the entire Americas, transatlantic routes as well as the Caribbean. In general, we are mainly focused on making sure we deliver an outstanding service for our customers — which we believe is best accomplished by satellite — and there are more components to it than purely capacity, but that is a large piece of it.
