Viasat completes merger with Inmarsat
After two years dealing with regulatory delays, Viasat has finally completed its purchase of Inmarsat, producing a single company that has 8,000 employees and a fleet of nineteen operating satellites.
The key quote from the link however is this:
Their merger announcement sparked additional consolidation plans as operators look to bolster their defenses amid a growing competitive threat from Starlink in the satellite broadband market. Eutelsat announced plans to buy OneWeb in November 2022 and hopes to complete its merger this summer. SES and Intelsat confirmed March 29 they were in talks about merging, although they have not provided a meaningful update since then.
In other words, the older geosynchronous satellite companies are consolidating because of the competition posed by SpaceX’s Starlink system, which also suggests these companies have never competed very aggressively against each other to cut costs. Now that someone new (SpaceX) has arrived doing that, they find their only option is to merge. Apparently the corporate culture in each separate company finds cutting costs difficult. Merger appears to be their only avenue for doing so.
I wonder what will happen to these old satellite companies when (or if) Amazon finally begins launching and operating its own Kuiper constellation, in direct competition with SpaceX. Unless they finally begin to offer a competitive product at a competitive price, I expect after consolidation we will begin to see bankruptcies.
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After two years dealing with regulatory delays, Viasat has finally completed its purchase of Inmarsat, producing a single company that has 8,000 employees and a fleet of nineteen operating satellites.
The key quote from the link however is this:
Their merger announcement sparked additional consolidation plans as operators look to bolster their defenses amid a growing competitive threat from Starlink in the satellite broadband market. Eutelsat announced plans to buy OneWeb in November 2022 and hopes to complete its merger this summer. SES and Intelsat confirmed March 29 they were in talks about merging, although they have not provided a meaningful update since then.
In other words, the older geosynchronous satellite companies are consolidating because of the competition posed by SpaceX’s Starlink system, which also suggests these companies have never competed very aggressively against each other to cut costs. Now that someone new (SpaceX) has arrived doing that, they find their only option is to merge. Apparently the corporate culture in each separate company finds cutting costs difficult. Merger appears to be their only avenue for doing so.
I wonder what will happen to these old satellite companies when (or if) Amazon finally begins launching and operating its own Kuiper constellation, in direct competition with SpaceX. Unless they finally begin to offer a competitive product at a competitive price, I expect after consolidation we will begin to see bankruptcies.
The support of my readers through the years has given me the freedom and ability to analyze objectively the ongoing renaissance in space, as well as the cultural changes -- for good or ill -- that are happening across America. Four years ago, just before the 2020 election I wrote that Joe Biden's mental health was suspect. Only in this year has the propaganda mainstream media decided to recognize that basic fact.
Fourteen years ago I wrote that SLS and Orion were a bad ideas, a waste of money, would be years behind schedule, and better replaced by commercial private enterprise. Even today NASA and Congress refuse to recognize this reality.
In 2020 when the world panicked over COVID I wrote that the panic was unnecessary, that the virus was apparently simply a variation of the flu, that masks were not simply pointless but if worn incorrectly were a health threat, that the lockdowns were a disaster and did nothing to stop the spread of COVID. Only in the past year have some of our so-called experts in the health field have begun to recognize these facts.
Your help allows me to do this kind of intelligent analysis. I take no advertising or sponsors, so my reporting isn't influenced by donations by established space or drug companies. Instead, I rely entirely on donations and subscriptions from my readers, which gives me the freedom to write what I think, unencumbered by outside influences.
Please consider supporting my work here at Behind the Black.
You can support me either by giving a one-time contribution or a regular subscription. There are five ways of doing so:
1. Zelle: This is the only internet method that charges no fees. All you have to do is use the Zelle link at your internet bank and give my name and email address (zimmerman at nasw dot org). What you donate is what I get.
2. Patreon: Go to my website there and pick one of five monthly subscription amounts, or by making a one-time donation.
3. A Paypal Donation:
5. Donate by check, payable to Robert Zimmerman and mailed to
Behind The Black
c/o Robert Zimmerman
P.O.Box 1262
Cortaro, AZ 85652
You can also support me by buying one of my books, as noted in the boxes interspersed throughout the webpage or shown in the menu above. And if you buy the books through the ebookit links, I get a larger cut and I get it sooner.
Robert wrote: “I wonder what will happen to these old satellite companies when (or if) Amazon finally begins launching and operating its own Kuiper constellation, in direct competition with SpaceX.”
These heritage communication companies have worried about this for quite some time. Orders for geostationary satellites have been a bit off, the past few years, as these companies wait to see how the large constellations do and how much of the business they lose due to these constellations. This may be one of the reasons for the mergers.
“… which also suggests these companies have never competed very aggressively against each other to cut costs.”
I believe this is correct. Satellite communication companies have sometimes been monopolies in the regions that they cover. Inmarsat, for instance, has been the major provider for marine communications (mid-ocean ship to shore) for decades. Intelsat, however, had oceanic cables as its competitor. Satellite Television companies tend to compete with each other (e.g. Dish Network and Direct TV), and the ground competition is cable television companies (themselves monopolies in their own regions).
In the U.S., airline deregulation was very hard on the heritage airlines. The heritage airlines were regulated and controlled (virtually run) by the government, making competition difficult. In the two decades after deregulation, most filed for bankruptcy at one time or another (and Continental more than once), and several stalwarts are no longer in business. Could the space newcomers do the same to the heritage space companies as the airline newcomers did four decades ago?