Mobile satellite operator Thuraya plans to pursue a near term strategy focused more on alliances than the expansion and renewal of its fleet.
Speaking at a press conference for its new SatSleeve device that turns iPhones into satellite phones, Thuraya…
Mobile satellite operator Thuraya plans to pursue a near term strategy focused more on alliances than the expansion and renewal of its fleet.
Speaking at a press conference for its new SatSleeve device that turns iPhones into satellite phones, Thuraya chief executive Samer Halawi said that the company has set up an advisory council to consider its future strategy and satellite procurement plans, but in the meantime would look at securing new alliances and cooperation agreements.
Halawi said: “This industry is a bit messed up right now, some people have tried to make it look like everything is good but the point is there is confusion, the customers are confused, the distributors are confused, I think some of my colleagues are confused. There are too many different standards, too many different price points and too many different strategies.
“So what we are looking to do is to align with other people. There are a lot of operators out there who are trying to do everything themselves, but there are others who don’t have the capability to do it all and yet what they do is really good. So there is a possibility for alliances in this industry and joint plans that perhaps would be much more powerful than trying to do everything on your own even if you have the funding for it.”
Thuraya, which follows a wholesale model approach, currently has 354 roaming agreements with mobile operators around the world, most recently signing a strategic partnership with US telecoms giant AT&T. That deal will provide outbound GSM roaming for voice and data services to Thuraya users across the United States, and in return AT&T customers will be able to roam and use the Thuraya satellite network across EMEA and Asia.
The company is also on the verge of launching mobile satellite services in China through its partnership with Armarda, the Hong Kong-based owner of China Mobile Satellite Communications Group (CMSCG).
Halawi said that Thuraya is currently in soft launch mode with its Chinese partner, having almost done all the technical integration that was required. He intimated that the company may announce further details on this in the coming weeks.
As for ordering new satellites, Halawi argued that the company would not rush into anything and was assessing every possible option.
“At the end of last year we set up an advisory council, composed of individuals who are very prominent in the industry. The role of this committee is to work with us and our board of directors to put together a strategy for the future.
“So far our business has been mainly L-band, but what are we going to do in the future? Are we going to get into new bands? Are we going to add a satellite to cover the Americas? Those are some of the questions that we are going to try to answer.
“What we want to make sure is that whatever we do for the future it is something that the market will require ten years down the line. We are not just going to replenish our satellites as is because we are reacting to the fact that our satellites are falling out the sky, like a couple of our competitors have done. They were in the unfortunate position where they had to make quick decisions, and we don’t believe those were appropriate decisions because you are adding capacity and space that will not be utilised and will not be in demand in the future.
“So what we are doing is looking at the trends in the market and the applications that the end users are looking for, to make sure that, whatever technology that we deploy, it is something that will provide for such applications. We believe that this market requires innovations, not only in the products but in the business models that we employ as a company.”
Halwai was also relaxed over when these decisions would need to be made, stating:
“We don’t have any time pressure today. Our first satellite has an end of life anywhere between 2018 and 2020. Usually you need three years before the end of life of a satellite to make a decision. We’re starting to look at this way earlier so that we are not in the same position as our competitors who had to make some quick and rash decisions.
“There are alternatives that we are looking at (such as ordering a satellite for the Americas) where things could happen much earlier than 2018. That is the deadline for us to make sure that we continue to serve our existing customers, and that is only in one part of the world. We have another satellite over Asia that has a lifetime until 2023 or 2025.”
While the Thuraya CEO questioned the high level of financing that his rivals have secured through export credit agency backed deals, he does see export credit as a viable funding option for the company’s next satellites.
“Definitely, ECA is always a very good option but what you want is a good business sense,” Halawi said.
“Once you have that it sells itself for funding from any source, not just from ECA.”
Thuraya, which reported a 4% growth in revenues in 2012, is launching a voice-only version of its SatSleeve in April with a voice and date product set to be offered in August. The initial batch of 5000 has already been pre-sold to its service partners and the company is starting to engage with both mobile operators and defence agencies over further deals. Its first major deal is with Japanese telco Softbank.
