Satellite Companies Jockey for Position in Hotly Contested Maritime Market

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PARIS Recent announcements by satellite operators Astrium Services, Intelsat and Telenor Satellite Broadcasting, among others, coupled with the Iridium OpenPort and InmarsatFleetBroadband market introductions are indications that the once-sleepy maritime satellite communications market has now become a hotly contested domain.

As commercial ship owners ratchet up their demands for voice, video and high-speed Internet links for on-board business and crew leisure, what was once the private pool of London-based Inmarsat has become a splash fight between providers of L-, Ku-, C-, Ka- and X-band services.

How big the market is remains unclear, as is the eventual split between commercial and military customers. Much will depend on the timing of deployment of planned U.S. military communications systems, and the early results of Ka-band in harsh weather environments like the North Atlantic.

Inmarsat, traditionally an L-band player, is concerned enough about the threat to its core market to have embarked on a $1.2 billion investment program for three large Global Xpress Ka-band satellites, to be launched into geostationary orbit between 2013 and 2015.

Boeing Space and Intelligence Systems of El Segundo, Calif., is building the satellites and, in return for getting the contract, has agreed to pay Inmarsat an up-front fee for the rights to sell Global Xpress’ military Ka-band bandwidth to U.S. government agencies. Boeing also will be selling Inmarsat’s standard, lower-speed L-band service under a separate agreement.

To protect its customer base,  Inmarsat is offering package prices to customers “previously at risk from alternative service providers” to upgrade to FleetBroadband, Inmarsat announced in August. While some near-term revenue may be sacrificed, the company believes the strategy will pay off in the longer term.

In an effort to secure a future market for Global Xpress, Inmarsat in March spent $159.5 million to purchase maritime VSAT communications provider Ship Equip, whose customer base of 850 vessels using Ku-band VSAT systems Inmarsat hopes to migrate to Global Xpress.

Inmarsat-owned Stratos Global of Bethesda, Md., which vies with Vizada of Paris for the title of the largest Inmarsat service distributor, said that as of mid-2011 it had activated more than 8,000 FleetBroadband systems for its customers. Stratos’ total customer fleet, with services from Inmarsat and Iridium, among others, totals more than 40,000 vessels.

McLean, Va.-based Iridium Communications says its Iridium OpenPort service, introduced in 2008, continues to gain traction in the market and is responsible for Iridium’s continued subscriber growth.

Vizada, which earlier this year was purchased by Astrium Services for $960 million, in early 2011 introduced its own VSAT, or very small aperture terminal, maritime broadband service, called PharostarTM. That service will take advantage of Ku-band maritime bandwidth being made available by large satellite fleet operators, including Intelsat of Luxembourg and Washington.

Vizada, which is a major Iridium and Inmarsat distributor, will continue offering OpenPort and FleetBroadband. PharostarTM uses Internet Protocol technology provided by iDirect of Herndon, Va., and offers data throughput at up to one megabit per second.

Inmarsat’sFleetBroadband offers connections at up to 432 kilobits per second, while OpenPort provides data links at up to 128 kilobits per second.

To assure that it is not losing a potentially large new application, Intelsat has agreed to focus beams on several of its satellites over ocean areas to provide a global service to maritime customers. Intelsat also has partnered with Astrium Services to market X-band satellite capacity, which Astrium has through its current Skynet 5 satellites, and the future Anik G1 satellite to be operated by Telesat of Canada and scheduled for launch in late 2012.

The X-band terminal on Anik G1, to be stationed at 107.3 degrees west longitude, will provide Pacific Ocean coverage from North America to Hawaii. Astrium Services has said X-band allows higher throughput, with fewer rain-attenuation issues, when compared with Ka- and Ku-band transmissions an assertion that Inmarsat has challenged.

Telenor of Norway is adding a Ka-band payload on its Thor 7 satellite, under construction by Space Systems/Loral of Palo Alto, Calif., and scheduled for launch in 2013, for the Nordic maritime region. Telenor officials have said their studies have concluded that Ka-band spot beams can target sufficient energy to provide high-speed links even in the stormy weather common to the North Sea.