Hand-Held at Sea

According to Lloyd’s List (subscription required), Inmarsat is focusing on hand-held satellite communications devices for maritime service:

LEADING satellite communications provider Inmarsat is gearing up for a major entry into the hand-held market after signing off the deal with voice service provider ACeS International.

“This was the final piece in the jigsaw for our services, and we are now ready to make big strides in the mobile voice sector,” said Robert Johnson, director of maritime services for Inmarsat.

The deal will give Inmarsat the means to compete with Iridium, its principal rival in the commodity voice segment.

The London-listed company bought the intellectual property rights of ACeS International last month and expects initial annualised revenues from the collaboration to be in the region of $3m-$5m from capital expenditures of approximately $40-$50m over two years for ground infrastructure and development on the ACeS R190 phone. 

The ACeS press release on the partnership can be found here. The InMarsat/ACeS system relies upon low-bandwidth communications using geosynchronous satellites in the L-band, which is a global allocation. Thus, you can operate in the same frequency anywhere in the world.

Iridium tried (and failed in) the hand-held satcom market in the 1990s, as The Wall Street Journal recently reminded us:

"They were targeting people in deserts and on ships in the middle of oceans, and one of my life lessons is that you can’t get a good business serving the fringe," said George Calhoun, a telecom entrepreneur and professor of technology management at Stevens Institute of Technology in Hoboken, N.J. "I remember thinking at the time that this was a trial balloon and that they weren’t serious."

Well, the creditors to Iridium remain serious; now they’re going after parent company Motorola to recoup their losses.

So who, exactly, needs handheld satcom equipment? The big boats with lots of people (cruise ships, naval vessels) have big dishes for TV — and they can spend the money required for marine-stabilized antennas.

The Inmarsat maritime service is useful, we suppose, if you want to blog while floating on a raft in the middle of the ocean. Or if you’re rowing a boat to the Canary Islands. But the question remains — is there a mass market for handheld sat phones?

What do you think?