The Business of Passenger Experience
The only official announcement around electronically steered antennae (ESA) for commercial aircraft this week at Aircraft Interiors Expo in Hamburg came from Gogo. And it probably was the least significant ESA story from the show. Instead, a surprise from a different supplier stole the spotlight.
Inmarsat's financial future appears secured. A consortium of investors is poised to invest $3.4bn in the company, taking it private. The price tag represents a 45% premium from the trading rate on the day prior to speculation about the deal becoming public and 27% to the price when the official offer was published. Inmarsat's Board of Directors unanimously recommends the deal and committed their respective shares to vote in favor. The investment group is operating under the name Triton Bidco and is backed by Apax Funds, Warburg Pincus Funds, the Canada Pension Plan and the Ontario Teachers' Pension Plan.
Another quarterly earnings report from Inmarsat and another bullish report on inflight connectivity revenue. The group reported IFC revenues more than doubled to $101.3m for the full year. As revenue and install count continues to grow Inmarsat is optimistic, though the underlying numbers suggest the potential remains unrealized.
When one or two executives leave a company it doesn't usually make the news. When it is a handful all at once eyebrows start to raise. After last week's news of one such shake-up in the inflight entertainment and connectivity world, however, the company's CEO says this is simply business as usual, finishing up a restructuring started in 2018.
The wheels of justice may turn slowly, but they press forward as Viasat continues its efforts to see Inmarsat's European Aviation Network (EAN) shuttered. The company won a ruling in Belgium that will see some of the open questions passed to the European Court of Justice (ECJ), reaching the top legal threshold and potentially putting an end to the wrangling. Alas, no one expects the answers to come quickly.
Work as a senior executive in the inflight entertainment and connectivity business can be a fragile position. As the companies in the space continue to come up short on consistent and stable profits the likelihood of a sudden shift remains very real. Reports in to PaxEx.Aero suggest that just such a shift is underway at one of the leading providers in this segment.
Is there a secret to better financing of inflight connectivity solutions? Indonesia's Mahata Aero Technology (MAT) is the latest to take that plunge, with an arrangement to cover the costs for Garuda and Citilink. The deal relies on partnerships with suppliers Lufthansa Systems, Lufthansa Technik and Inmarsat, along with what MAT Executive Director Iwan Setiawan describes as "a unique business model" that is proving successful in its preliminary state.
As the installed aircraft count ticks higher for Viasat so, too, does the share of revenue the company realizes from that segment. The growth rate will slow in the coming year as the American Airlines fleet completes its conversion (more than 450 aircraft installed to date) but CEO Mark Dankberg believes there is still runway left in the market. Even if it is going to be a little later than previously expected.
Some good news for Gogo and its 2Ku airline customers as it reaches closure on an outstanding maintenance issue. This should ease the backlog as additional aircraft can once again be installed for three airline customers.
Fresh off the announcement of its first commercial airline customer, upstart inflight connectivity provider SmartSky secured additional funding to complete its nationwide network deployment. The company announced a $104mm investment, bringing the total investment for the company to nearly $350 million.
