Iridium expands offerings to compete with Inmarsat

 - July 3, 2007, 11:42 AM

Iridium is inching closer to obtaining ICAO and FAA approvals that will allow airlines to use the satellite service for transmitting safety-of-flight messages to ATC on oceanic routes and over the North Pole. An aeronautical working group consisting of government, industry and airline members has approved Iridium’s plan for providing aeronautical mobile satellite route services (commonly referred to simply as AMSRS), which now heads to an Arinc standards panel for tweaking.

Once all the approvals are in hand, expected sometime next summer, Iridium would become only the second authorized provider of AMSRS safety service messaging behind Inmarsat, which has held a lock on the market until now. Airlines are excited about the arrival of a second service provider, some of them because Iridium phone calls are less expensive than Inmarsat’s, and others because the Iridium network of 66 low-earth-orbit satellites can provide truly global coverage even over Polar routes.

Iridium doesn’t expect to erode Inmarsat’s market dominance in the AMSRS arena overnight, however. Installing Iridium transceivers and antennas across a fleet of airplanes is not a trivial cost and will have to mesh with regular airline budgeting cycles, meaning that there will likely be a steady rate of installations over a long period of time rather than a mass exodus of customers, Iridium officials predict.

“We don’t anticipate there will be a big bang of uptake,” said Iridium director of data services David Wigglesworth. “It will probably start with the cargo airlines and then migrate to other segments.” Polar coverage will be an important factor for airlines that have determined they can shave time–and save fuel–by flying over the North Pole on certain routes. Inmarsat’s satellite network, consisting of four (soon to be reduced to three) geostationary satellites “parked” in orbit 24,000 miles in space, has coverage gaps at the poles.

Next-generation Satellite Network
Securing the approvals to provide AMSRS services to the airlines is one part of a strategy by Iridium to compete with Inmarsat head to head. But it’s not the only one. What started out in 1996 as a cellular network in the sky has been transformed by market forces into a formidable competitor to the Inmarsat satellite services, not only for the aeronautical market but also military, maritime and land markets. The bigger piece of the puzzle that Iridium executives hope will boost the company’s subscriber numbers is a future replacement satellite network appropriately called Iridium Next.

Iridium plans to make a number of partner announcements soon, but it has confirmed that the Next network will include broadband data delivery capabilities as a key component. No firm decisions have been made, but the hope is to provide connection download speeds as high as 10 megabits per second for aero users through the use of Ka-band satellite technology. Users on the ground might receive data streams of as high as 30 megabits per second, Iridium says.

Also high on the list of capabilities the Next service will likely provide is wide-area broadcast of weather information and graphics. Such a service would undoubtedly be warmly welcomed by operators of long-range business jets operating to far-flung destinations around the globe. The new Iridium might even be suitable for augmentation or backup of GPS signals, the company said, as well as other uses yet to be disclosed.

“The original Iridium was really a point-to-point service,” Wigglesworth said. “What we’re looking at with Next is a ‘one-to-many’ network that can provide
a variety of voice and data services to all kinds of users on the ground, in the air and perhaps even in space.”

To help Iridium recoup some of the estimated $2.2 billion to build the Next constellation, the company is considering launching its satellites with secondary payloads paid for by outside companies. Satellite launches for the Next constellation are predicted to begin in 2013 and not finish until perhaps 2017, Wigglesworth said. Currently, Boeing operates 66 satellites and another nine spares for Iridium from a satellite network operations center in Leesburg, Va., not far from Iridium’s Bethesda, Md. headquarters.

Iridium hasn’t yet approached the venture capitalist or banking communities to raise the money for the Next network and insists that it is still exploring self-funding options. The clock is ticking, however, as age, battery life and limited fuel supplies on board the satellites ensure the current Iridium service won’t stay on the air for too many more years. Those original satellites–built and deployed by Motorola–were thought to have a lifespan of just five years when they were launched more than a decade ago. Engineers made the wise decision to fill each satellite’s fuel tank before launch, a factor that has helped the satellites to remain in orbit for far longer than designers thought they would.

“Actually fuel and battery life aren’t the life-limiting factors for the satellites,” Wigglesworth said. “Other mechanical considerations are more important.” Just like
its predecessor, Iridium Next, he said, will consist of 66 satellites plus spares.   o