Inmarsat Says It Could Support ATC with I-4 Satellites, in Talks With Potential Partners

Inmarsat may lack an ATC license from the FCC, but it’s better angled to jump into an ATC venture than ATC-licensed competitors MSV and Globalstar thanks to its new Inmarsat 4 satellites, Sukawaty said. Inmarsat’s 4F1 and 4F2 crafts, recently stationed over the Indian Ocean and N. America, “put us in a position to support ATC… we're now in a position to do a deal on this,” he said. Sukawaty said the firm’s 3rd Inmarsat 4 satellite, built and in storage, could satisfy the FCC’s spare ATC satellite mandate. The firm has penned launch contracts with International Launch Services and Sea Launch, but is waiting for “the right business case” before it lofts the craft, he said.

Inmarsat is eyeing ATC options abroad, Sukawaty said. “We have satellites in the sky and we have spectrum that is also global, so as this rolls out beyond the U.S. and Canada -- which we think it will -- we'll have the opportunity to be a global provider,” he said. FCC ATC authorizations are drawing foreign regulators’ notice (CD Feb 23 p6), FCC International Bureau officials have said. Non-U.S. regulators are mulling ATC services’ technical parameters, Sukawaty said, estimating other nations’ regulatory regimes as being 3-5 years behind the FCC. “We have had informal discussions with regulatory bodies in Europe, and ATC is being considered,” he said.

Any Inmarsat partnership with a satellite radio operator on a terrestrial ATC venture likely would be outside the U.S., said satellite industry analyst Tim Farrar, pres. TMF Assoc. WorldSpace is the only satellite radio firm outside the U.S. and Canada, but European firms pushing new service have been gaining momentum. WorldSpace subsidiary AfriSpace and Spain’s Ondas Media are tangling over European satellite radio issues before the FCC (CD Feb 27 p4). Inmarsat’s most probable ATC partner: a U.S. wireless operator, Farrar said. In fact, to defend against a mass market mobile satellite services (MSS) play, wireless operators could sign roaming pacts with mobile MSS operators, Farrar suggested.

“There will be more than one deal signed here,” Sukawaty said of ATC partnerships. “There may be early deals, and there may be later deals. We think we're in a prime position to support someone on the ground who wants to do something quick and cost effectively,” he said. Inmarsat likely would structure an ATC deal with 2 revenue flows: one from use of satellites, another from integrated satellite/terrestrial service and use of its L-band spectrum on the ground, Sukawaty said. But the CEO admitted ATC, as an unproven technology, swims in a sea of unknowns. “There are technical and commercial challenges ahead for ATC that are not trivial,” he said. Terrestrial partners might avoid ATC as a technological route, he said: “It’s never a deal until it’s a deal.”

MSV/Inmarsat clashes on L-band issues at the FCC include rumbles over sharing spectrum (CD Jan 27 p8). The disputes are complicating roll-out of Inmarsat’s new high-speed mobile BGAN service over the Americas. MSV claims Inmarsat’s new satellite lacks proper coordination and that running Inmarsat 4F2 over the U.S. could harm MSV’s next-generation system in the L-band, set for 2009 launch. While Inmarsat and MSV probably could deploy ATC networks without coordinating their efforts, it’s in both firms’ interests to work together on the issue, Sukawaty said. Inmarsat and MSV “will continue to fight at the FCC when it’s appropriate,” he said.

Inmarsat posted revenue of $491 million in 2005, up from $481 million in 2004 and driven by maritime and aeronautical sector growth, not on land, the firm said. Land sector 2005 revenue fell 9% to $122 million. Data revenue slipped 7% as govt. and military use in the Middle East shrank and R-BGAN service diminished, officials said. Aeronautical revenue grew 34% to $23 million thanks to more Swift64 terminal installations, they said.