Inmarsat, the London-based International Maritime Satellite Organisation, is to spin off its proposed Inmarsat-P global communications service as an affiliate limited company. The surprise move – no decision was expected until a special session of the Inmarsat Assembly to be held at the start of next year was made by the Inmarsat ruling Council at […]
Inmarsat, the London-based International Maritime Satellite Organisation, is to spin off its proposed Inmarsat-P global communications service as an affiliate limited company. The surprise move – no decision was expected until a special session of the Inmarsat Assembly to be held at the start of next year was made by the Inmarsat ruling Council at a meeting in London last week. At the meeting, the 74-member international co-operative’s Council decided to develop a prospectus for the as yet unnamed unit, which will implement the satellite and ground infrastructure for Inmarsat-P. Further, it proposed a progress schedule enabling the establishment of the affiliate before the year is out. Initially, the unit will be open to investment only by Inmarsat and its investor signatories, but up to 30% of the company will eventually be floated to non-Inmarsat signatories, says the organisation; no time scale for this flotation has been outlined. The meeting also decided that Inmarsat-P will use a new Intermediate Continental Orbit satellite system to provide its services. To this end, the Council authorised a supplementary budget of $10m for Inmarsat to progress work on the Intermediate Continental Orbit implementation in areas such as system definition. This work will begin before the new unit becomes operational, enabling it to initiate spacecraft and ground segment procurement or select strategic appropriate partners immediately following its formation, says an Inmarsat source. According to this source, the affiliate will function as a completely separate organisation, but Inmarsat will be contracted for work in areas such as space segment acquisition, management services and system operation. As to the reasons for creating an affiliate, Inmarsat says it is a consequence of its existing funding arrangements, whereby financing from members is based solely on traffic volume.
This has been a potential stumbling block to Inmarsat-P’s development, in that some Inmarsat signatories have no commercial interest in the system, while others have wanted a bigger share of its pie than allowed under the current regime. By freeing members from existing restrictions, each will be able to bid for as little (or much) of it as they choose. The need to remain competitive has also contributed to the Inmarsat-P plans. Although Inmarsat can’t bring itself to mention Motorola Inc-headed rival Iridium Inc, saying that its decision was not taken with any specific competitor in mind, it acknowledges that the move to create a leaner, commercial operation has been made in recognition that Inmarsat is entering an aggressive competitive environment. Finally, the Council called for a co-ordinated effort to secure the 2GHz frequency spectrum for Inmarsat-P and the designation of bands below 16GHz for feeder links. It urged member organisations to petition for this at the International Telecommunications Union conference, scheduled for November next year.