A little bit of rhetoric, some marketing spin, some bold claims of capabilities; these are all to be expected in a competitive market. And there is no doubt that the inflight connectivity world is a competitive one, with vendors fighting to secure their share of the available tails to be fitted.
Industry consolidation has been discussed for years, most recently by Global Eagle Entertainment’s former chief. And stakeholders have long questioned the viability of various providers in the space (“how much blood do you have in your pockets” and all of that). Vendors with planes flying are presumed to be safer than those without, leading to increasingly aggressive claims.
Public fights over product capabilities and balance sheets are nothing new but it appears that the battle of words is on the cusp of boiling over, with more outlandish claims being made, and the public fight rolling into Twitter. A recent spat stems from comments made by ViaSat CEO Mark Dankberg during an investor conference.
When asked to explain the difference between ViaSat’s approach and Gogo’s Ku solutions Dankberg came out heavy against 2Ku and the ThinKom antennae powering that system, “[W]hat they’ve done is they’ve basically said, it’s an antenna problem. They have this thing they call 2Ku, it doesn’t matter what satellite we use, what matters is that we have a good antenna. That’s not true, I mean, that makes no sense…. [P]robably the highest capacity Ku-band satellites even contemplated are in the 10-ish gigabit per second range. So essentially, the same capital cost as our satellites. So think of their raw cost of bandwidth as 10 times as much.”
Gogo’s CEO Michael Small challenged that statement in a short retort on Twitter: “Dankberg claim that 2Ku antenna doesn’t have any performance advantage is laughable and completely false.”
And, unsurprisingly, they are both correct in different ways. The larger capacity of the Ka-band satellites drops the raw cost of capacity for ViaSat, and its direct ownership gives it more pricing control. At the same time the spectral efficiency of the 2Ku antenna gives it advantages in converting megahertz of spectrum into megabits of bandwidth, as does the split send/receive hardware approach. Gogo also claims efficiencies closer to the equator thanks to beam shape from the ThinKom hardware and the ability to reduce skew angle impact in that region.
A 50 megabit or even 1 gigabit spot beam over a hub might not be enough capacity to handle a full fleet of peak bank timed flights (apparently part of Dankberg’s claim, though it doesn’t necessarily read that way) but the Ku-band ecosystem generally offers more beams to choose from in any given area, a point Gogo highlights in a new blog post. And of course more satellites are launching – in both bands – each month (SES-15 successfully launched mid-month, as did the Ka-band Inmarsat I-5 F4; ViaSat-2 and Eutelsat 172B are set to fly on 1 June, and your author will be present to witness the event).
ViaSat’s Don Buchman was recently quoted in the International Business Times as suggesting that competing vendors must aggregate bandwidth to an aircraft while the ViaSat solution does not: “The [ViaSat] service provides 12 Mbps to every connected passenger device, as compared to competing services that give aggregate bandwidth to a plane, making passenger devices fight for Internet service. Often it is not just one plane that is sharing the Internet service, but multiple planes flying in that satellite beam.”
This difference is one we know to be false, and we have known that for years. In September 2013 ViaSat’s Meherwan Polad admitted as much, saying, “If everyone is doing 12 Mbps of streaming that’s not going to happen on board, but in terms of 12 Mbps web browsing absolutely we can deliver that.” Or, put more simply, ViaSat is aggregating bandwidth to the plane and passengers share it, just like with every other solution on the market today. Moreover, just like other solutions, every plane in a beam shares the total capacity of that beam; in ViaSat’s case that is also shared with ground users. For Inmarsat, Panasonic Avionics and Global Eagle the maritime sector also factor in.
We’ve also heard talk from Gogo of roaming between GEO and LEO satellite constellations to deliver more bandwidth and lower latency. The LEO constellations to support this aren’t operational today – and 2Ku hasn’t proven itself on that front yet – so such roaming via 2Ku is still a theoretical conversation. There is plenty of optimism in the market about electronically steered antenna solutions that may eventually deliver on this promise, but none are close to flying on commercial aircraft right now (Intelsat has intimated that bizjet solutions are forthcoming, though). Panasonic shelved its most recent public effort on the phased array front last year; Inmarsat and SES later effectively agreed that it will be years, not months, before these technologies are flying on commercial airlines.
The operating economics for a satellite operator also depend on what can be sold to customers. Flying a massive amount of capacity does not pay for the build and operating costs of a satellite; customer subscriptions do. Inmarsat’s Leo Mondale spoke to this during the F4 launch event, “The people who make money are the ones who fill them up, not the ones who fly big, speculative amounts of capacity.” That comment is a not-so-subtle dig at the ViaSat-3 constellation. For ViaSat the ground component helps significantly in addressing the overall revenue side of the equation much like Inmarsat, Panasonic and Global Eagle benefit from maritime or government contracts. Gogo’s aero focus removes some of those economies of scale but the more efficient antenna helps bring the per byte costs down.
In short, everyone has a story to sell and each is working very hard to inform the market on what is and is not possible in their view, which is effectively confusing the market, especially as those views are often conflicting.
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