Making Waves

Inmarsat, whose solutions are effectively a standard in the maritime sector, faces increasing competition in the market from new players. In response, it is ramping up its focus on maritime services and trying to convince shipping companies to use them in new and more sophisticated ways

  • E-Mail
By  Richard Agnew Published  August 28, 2004

|~|inmarsat1.gif|~|Samer Halawi, regional director, Middle East and Africa, Inmarsat|~|The maritime sector has traditionally been a mainstay of the satellite communications industry, but recently, its relative importance has gradually waned. Inmarsat, for example, has strong roots in the sector, having come into being in 1979 as a small inter-governmental organisation providing communications and safety systems to ships. It witnessed a decline in its maritime business from US$277.5 million in 1999 to US$245.6 million in 2003, while revenues from its land, aviation and navigation-based services all increased. Nevertheless, the maritime industry still generates the largest chunk of the operator’s revenues, and it is keen to see renewed growth. “The maritime market is the one that Inmarsat was created to serve and it’s a very important one,” says Samer Halawi, regional director, Middle East and Africa, Inmarsat. “The sector represents about 60% of our revenues, so it still generates most of our earnings. It has been decreasing, but that is mainly because other services are increasing, including our land based services such as our Regional Broadband Global Area Network (RBGAN) solutions,” he adds. Inmarsat’s main efforts in the maritime sector this year have centred on its family of ‘Fleet’ solutions, launched in 2003. According to Halawi, over 3000 of the units have been sold so far. The first of three systems, the Fleet 77, is essentially an adaptation of the operator’s land-based Global Area Network (GAN) solution for sea-going firms, offering voice and 64Kbits/s data, either by ISDN or mobile packet data (MPDS). Aimed at larger, ocean-going vessels, Fleet 77 is also being used by the operator to persuade shipping companies to replace its older, A, B and M systems. For smaller ships, meanwhile, the range includes the Fleet 55, a more compact system which offers global voice connectivity, but its 64Kbits/s IP and ISDN connectivity is designed for vessels that stay nearer to shore. Lastly, the Fleet 33 offers voice, fax, dial-up data and MPDS at 9.6Kbits/s, but has integrated compression technology to boost apparent speeds. As it is aimed mainly at the leisure sector, uptake of Fleet 33 is expected to grow in the region as upcoming marinas and offshore residential developments are opened up in Dubai. In addition, the launch of the solutions reflects wider, strategic aims of the operator. One is to increase shore-to-ship communications — while there is a limit to the amount data that a vessel has available to send, Inmarsat is trying to convince companies that a greater two-way flow of information between ships and their offices on shore could improve their efficiency. For example, as with its land business, the operator and its service providers are pointing maritime firms towards IP-based solutions such as e-commerce, secure instant messaging and the transfer of weather updates, using the packet data functionality of the Fleet platforms. Many fishing companies in Europe, it says, now use them to check prices on shore and determine which port would give them the best deal. “Maritime firms are becoming more and more sophisticated in terms of the services they use our solutions for, particularly e-commerce,” says Halawi. “The same kind of educational programmes we are running for RBGAN are happening for Fleet, to encourage the end-users to use them in IP mode. There is also more and more integration happening, so that shipping firms can be seamlessly integrated with the e-mail systems on their vessels,” he adds. Greater sophistication in the way the region’s shipping companies use their communications equipment is already becoming apparent, particularly in the cargo, and oil and gas sectors. Inmarsat service provider, Xantic, for example, sees interest growing in its Amos Maintenance and Purchasing (M&P) tool, which allows maritime firms to automate their supply chains and help keep their ships running. Firms that have bought the solution include United Arab Shipping, the dry cargo carrier. “It’s not off-the-shelf software, it has to be tailor-made for every company,” says Karim Zaki of Xantic Middle East. “The engineer inputs which spare parts have been used and what needs to be done into the system every day. During the night, the database is synchronised with the head office, so the purchasing officer knows what to order. Before, ships had to go to port, put the information into a DHL package and send it,” he adds. Other factors impacting on maritime communications include concerns over safety, security, and increasing demands for information from port authorities, both in the region and elsewhere. Through the International Maritime Organisation’s (IMO) Global Maritime Distress and Safety System (GMDSS) regulations, large ships have for a long time been required to implement systems to send out distress signals to authorities and others nearby when they run into trouble. Inmarsat, the only provider certified to support GMDSS, has integrated it into Fleet 77. Also, in the wake of 9/11, shipping companies have also been required by the IMO to implement ‘panic buttons’ to alert authorities to terrorist attacks. Ports are also becoming more stringent in their demands for ships to declare information before they enter them, such as the cargo they are carrying and details on the background of crew members. “As legal requirements increase, ships’ need for data communications grows. The requirements are not applied as heavily by port authorities in the Middle East, but if ships sail around the world, they still have to meet them,” adds Zaki. Inmarsat, meanwhile, is also using the Fleet solutions to persuade users of its old, analogue A service to upgrade — a move which would free up the operator’s bandwidth for the new data applications. As the satellites that support the A solution will shortly be de-commissioned, the operator is also subsidising Fleet hardware. “Inmarsat As are over 20 years old and although they are working well, they are not spectrum efficient,” says Michael Rambaut, deputy secretary general and secretary of the Comité International Radio Maritime, the association of marine electronics suppliers. “More companies are looking to use data services, so the more As Inmarsat removes, the more bandwidth it will have. It’s a matter of turning the As off and turning more efficient services on,” he adds. In the Middle East, Inmarsat is seen to have made some progress in migrating its maritime customers, but several companies are waiting until circumstances force them to do so. “We have migrated six shipping companies from Inmarsat As to Fleet 77 in the Middle East, but there are quite a few customers out there that still have them,” says Zaki. “Some are a bit reluctant because they are going to scrap the vessel anyway in a couple of years, or they will delay an upgrade until they cannot communicate anymore,” he adds. Another challenge facing Inmarsat is that it is facing increasing competition in the maritime market, particularly from other satellite mobile players. Thuraya, for example, recently began offering voice and messaging services for sea-going vessels, while Iridium is trying to carve out a niche for telephony and low-bandwidth data services, including prepaid systems for crew calling and fleet management solutions. According to Liz DeCastro, the operator’s corporate communications director, it is also focusing on safety and security, where Inmarsat’s solutions are essentially an industry standard. Iridium has launched solutions to meet SSAS regulations and is targeting emerging requirements for long-range tracking and identification of ships (LRSIT). “Obtaining certification for GMDSS is something we're considering,” she adds. Boeing, meanwhile, is another satellite provider looking to break into the maritime space, but with broadband solutions rather than low bandwidth data and telephony. It recently announced that it is adapting its high-speed Connexion solution — currently being aimed at the aviation sector — for the maritime industry. Although the service is only in trials, the company claims that it will offer up to 2.5Mbits/s to vessels and 256Kbits/s the other way once it is launched in mid-2005. “We plan to begin offering the service to shipping companies in the Middle East later this year, around the time we complete our trials” says Sean Schwinn, Connexion by Boeing’s VP, strategy and business development. “No agreements for commercial service have been signed yet, but we would expect those later this year or early next,” he adds. Down the line, another challenge for Inmarsat could actually emerge if the demand for bandwidth-hungry applications that it is aiming to foster really takes off. The operator has yet to offer a solution offering speeds over 64Kbits/s to the maritime sector, while its broadband solutions such as its RBGAN and upcoming BGAN are being geared solely towards land-based clients. Citing demand from large vessels for high bandwidth, Xantic recently signed an agreement with very small aperture terminal (VSAT) provider, MTN, to market high-speed solutions to the maritime industry worldwide. Maritime adoption of VSATs has largely been limited to cruiseliners and oil rigs so far, and VSAT-based teacking antennae can cost upwards of US$100,000 or US$5000 per vessel on a monthly leased basis. But shipping companies in the Middle East are believed to be considering adoption of the technology, including Kuwait Oil Tankers Company (KOTC) and Saudi Aramco’s maritime division, Vela International Marine Limited. Such a move would allow ships to have four telephone lines connected and up to four people on the internet at the same time, as well constant connections to their company’s virtual private network (VPN) and the option to do video-conferencing. “There is a bigger demand for greater bandwidth emerging,” says Zaki. “Some shipping companies are no longer happy with 64Kbits/s, they want more, and could move to the next stage which is to have a VSAT on-board,” he adds.||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code