US aerospace giant Honeywell has snapped up Danish communications firm Satcom1 to broaden its solutions in the growing US$8bn inflight connectivity market. The group’s push into the segment comes a week after Singapore Airlines agreed to use Honeywell’s JetWave satcoms terminals.
US aerospace giant Honeywell (NYSE:HON) has snapped up Danish communications firm Satcom1 to broaden its solutions in the growing US$8bn inflight connectivity market.
Privately held Satcom1, which expects to generate US$25m in sales for 2015, provides inflight satellite-based services for private business and government aircraft, alongside satcoms consultancy services.
Honeywell is already an active player in the sector, offering solutions ranging from flight and maintenance services planning to weather information and fuel saving applications.
The JetWave Ka-band terminals that Satcom1 distributes are made by Honeywell, and are designed to use Inmarsat’s next generation Global Xpress (GX) constellation that is set to launch full services next year. Satcom1 also has partnerships with satellite operators Iridium and Viasat.
Tim Mahoney, CEO of Honeywell’s aerospace division, said: “Demand for inflight internet and Wi-Fi connectivity is rapidly growing and Satcom1 will strengthen Honeywell’s position as a complete provider and integrator of satellite communications equipment, software applications and global airtime services … The addition of Satcom1 significantly bolsters our connectivity portfolio and enhances our growing software engineering expertise.”
The deal expands Honeywell’s global reach, broadening its presence in Europe through Satcom1’s Copenhagen headquarters, and its research and design and support centre at Le Bourget Airport, France. The Danish firm also has sales and consultancy offices in the UAE and Texas.
Growing its geographical presence was part of Honeywell’s rationale for a C$455m (US$341m) deal it launched earlier this month to take over Com Dev (TSX:CDV), the Canadian space hardware maker that has supplied equipment to about 80% of all commercial communications satellites.
Activity in the inflight connectivity market has been increasing in recent years amid soaring demand for data services in general.
Inflight service providers have been using acquisitions to gain the scale and integration they need to be competitive, as challenges including pricing pressures, regulations, satellite coverage, and installation costs continue to weigh on the sector.
Honeywell’s aspirations in this market were dealt a blow in November 2014 when US telco AT&T scrapped plans to launch a 4G LTE air-to-ground service. The two had announced a partnership just seven months before that and had envisaged launching those services in late 2015.
Last week, Honeywell revealed it had secured a deal to provide JetWave hardware for Singapore Airlines.
The group said it would install the GX Aviation system in the second half of next year on the airline’s B777-300ER aircraft, followed by its A380-800s.
Germany’s Lufthansa will be the first to use the services when its short- and medium-haul fleet is equipped in early summer 2016. Vietnam Airlines is also among the early adopters, and last year Honeywell signed a MoU with Air China to test the services on its aircraft.
