Executive Roundtable on the In-flight Broadband Market
by B.H. Schneiderman
Los Angeles, Calif., November 8, 2012--In-flight broadband is set for takeoff. In our bandwidth-hungry world, consumers expect to have broadband access anywhere, anytime, including when they’re in the air on long-haul flights. To shed light on this growing market Satellite Executive Briefing contributor B.H. Schneiderman spoke with executives from two satellite operators and an in-flight broadband service provider. Follows are excepts of the exchange with James Collet, Director of Mobility Services Product Management, Intelsat; Alexander Geurtz, Vice-President Services Development, SES; and Travis Christ, Chief Marketing & Sales Officer, Row 44.
Satellite Executive Briefing (SEB): How do you see the market for your product sservices that are focused in the aviation industry in the next five years?
James Collet, Intelsat: Market estimates forecast more than 5,000 aircraft will be equipped with in-flight broadband connectivity (data rates >3Mbit/s) with service revenues exceeding $1 billion within 5 years. Following our launch of Intelsat EpicNG, Intelsat announced signed agreements with industry leaders Panasonic Avionics and Gogo to provide broadband services to aircraft. Intelsat’s mobility infrastructure will allow customers to begin services in the near-term and then complement that with Intelsat EpicNGhigh-throughput platform in the future.
Alexander Guertz, SES: SES provide satellite infrastructure capacity to a wide range of customers across the globe. With the dramatically growing use of tablets and smartphones, we are seeing a strong increase demand for broadband access on-board aircraft, for both regional and inter-continental services, and we expect this to continue in the next several years. Satellite solutions are uniquely suitable for providing broadband services to aircraft given the wide coverage and substantial bandwidth available. SES is very pleased to work with a number of important players in this market already, such as Gogo with whom we announced a partnership earlier this year, as well as Row44, who are using one of our customers' platforms.
Travis Christ, Row 44: Demand among airlines around the world for inflight WiFi has risen tremendously over the last couple of years. The demand for streaming video in particular has more than doubled between 2011 and 2012 alone. Advancements in the types of devices that passengers bring onboard will undoubtedly continue, and airlines will likely focus on the partners that have the capabilities to remain the most modern and forward thinking. The key consideration for airlines now can be choosing a provider who is in full production, and past the point of "bleeding edge." With 400 aircraft flying, we've worked out the kinks.
SEB: Do you have any new product or service that you are planning to introduce soon to focus in this market?
INTELSAT: The scheduled launch of Intelsat 27 in the first quarter of 2013 will complete Intelsat’s global Ku-band mobility coverage. This global Ku-band fabric will deliver more than 60Mbit/s per beam to aero sized antennas to the busiest aero routes around the globe. Panasonic’s services will be expanded in the near term by capacity using two of the satellites within Intelsat’s Ku-band global broadband mobility platform. These services will be complemented by high throughput Ku-band capacity on Intelsat 29e, the first of the Intelsat EpicNG satellites when the platform launches in 2015.
SES: The SES-6 satellite, to be launched, will include coverage of the Atlantic region, one of the most intensively travelled international air routes. We're also planning dedicated coverage of the Indian Ocean region on the SES-9 satellite. In addition to satellite capacity, SES is also able to offer connectivity services on the basis of the iDirect platform technology
Row 44:In 2012 Row 44 rolled out a wireless IFE offering — a device-based inflight entertainment service delivering stored content wirelessly to passengers' WiFi-enabled devices. This solution can be easily upgraded to a full inflight connectivity system. In October, Row 44 announced our first customer for Wireless IFE — Las Vegas-based Allegiant Air.
SEB: Do you have any specific Region in the Global Market where you see this application growth trends during the next 5 years ?
INTELSAT: The first of the Intelsat EpicNGsatellites, our high-throughput addition to our global infrastructure, is scheduled for launch in 2015. Intelsat 29e will provide 200Mbps of throughput per spot beam into typical aero size terminals, thereby significantly increasing capacity for mobile services in high-density traffic Atlantic Ocean routes. Intelsat 33e, slated for launch in 2016, will similarly augment Ku-band mobile capacity in other high-density traffic routes around the globe
SES: We expect initial demand to come from the North American continent and from the Atlantic region, driven by the intensive air traffic between Europe and North America. In the longer term we expect the Asian and Latin American regions to experience significant growth for this application as well
Row 44: The Row 44 system is satellite-based — we are by far the most widely deployed satellite WiFi system in commercial aviation — which means we operate globally, and are in talks with airlines in regions around the world.
SEB: How do you see the growth in Ka-Band in the market place for the aviation industry at this time?
INTELSAT: Ka-Band services have their role in certain sectors, such as consumer broadband, and Ka-Band will be part of Intelsat EpicNG, but our analysis clearly shows that Ku-Band offered the best path forward in terms of risk and performance. World-wide markets for Ku-Band are well established, diverse and highly competitive. Ku-band technology is mature with a large supplier base, and using Ku-Band spot beams to increase communication speeds is just as achievable as Ka-Band spot beams.
SES: SES does not have a specific preference for either Ku-Band or Ka-Band for this market. Indeed, SES has made major investments in Ka-Band capacity over North America and Europe. So far, the Ka-Band market for aeronautical mobility has been primarily regional and with limited backup and alternatives. We feel that customers may not want to be locked into a regional or global solution with little or no redundancy or alternatives. Therefore, while SES does not exclude Ka-Band in the future, the majority of our investments for the commercial aviation market will be in Ku-Band.
Row 44: Row 44 is a proponent of Ka-band as a future technology and we are in development today. We'll make the transition when Ka has been thoroughly tested and is proven reliable and economical. We're taking the risk out of the Ka/Ku decision for our airline customers by providing proven Ku service today with a guarantee to transitioning to Ka when it's ready.
SEB: What applications will be driving demand for satellite services in the aviation market?
INTELSAT: Demand in the civil aviation market for satellite broadband connectivity is stimulated largely by passenger behavior. Passengers want to be connected throughout their travels. Bandwidth demand is driven by advances in mobile technology – including smartphones, tablets, and laptops. Passengers’ propensity for bandwidth intensive multimedia applications, such as streaming media, is increasing as these mobile devices become more sophisticated and ubiquitous.
SES: We're seeing strong demand from the commercial aviation sector for satellite capacity, as well as from the military sector, and we expect this to continue in the next few years.
SEB: Is there anything else you want to add that we haven’t addressed?
INTELSAT: Intelsat has demonstrated that it is committed to broadband mobility. It is firmly embedded in our long-term business growth strategy.
SES:We're concerned that regulatory constraints in Europe may restrict the success of this market over the European airspace, with the need for a wide range of authorizations not only at national, but also at local level, and sometimes on a per aircraft and/or per airport basis.
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B. H. Schneiderman is the Principal of Telematics Business Consultants. He can be reached at : info@tbc-telematics.com
