Northern Sky Research

Inmarsat and SkyWave Up the Ante on LDR Services

Apr 25th, 2011 by Jose Del Rosario   More from this Analyst | Profile

Inmarsat recently announced that it is working with partner SkyWave Mobile Communications to develop a new low data rate (LDR) tracking, monitoring and messaging service that is planned for launch in Q3 2011. The new device dubbed the IsatData Pro promises to deliver up to 37x data capability of current global M2M services. The announcement stated that compared to typical global M2M offerings that provide data connectivity rates of about 270-340 bytes, the new service aims to deliver near real-time messages of up to 10,000 bytes to the device, and up to 6,400 bytes from the device.

NSR is not surprised by this recent development and believes that LDR needs will continue to be addressed by higher data rate solutions. In fact plans that have been announced (which should materialize in the next few years) such as Iridium NEXT will provide the same, if not higher, levels of service in the SCADA/M2M/LDR market. For a service that is by nature inherently narrowband, providers are tapping the market with a strategic thrust of giving customers more than what they need. Although bandwidth needs are far from wideband and broadband in scope, bundled services that include software distribution, Internet/intranet access during maintenance schedules, and even CCTV for security purposes make for a compelling proposition in terms of service differentiation to customers.

To illustrate, in a market dominated by L-band solutions due to small antenna size, larger antenna Ku-band VSATs with broadband capabilities have entered the marketplace and have slowly gained inroads. For now, services like CCTV are being bundled for security purposes for critical assets such as pipelines, power grids and oil wells (among others) that are highly exposed and liable to attacks. The main missions remain as LDR for temperature readings, metering services and generating reports or alarms for specific assets, while service bundling that requires broadband capabilities will continue to be the service model in the next several years.

In the future, NSR sees a market fit for High Throughput Satellites (HTS) following or piggybacking on the success of Ku-band solutions. The proposition seems ironic when LDR and HTS are put together in an offering, yet trends towards higher data solutions are slowly gaining inroads in select market niches.



Over time, the main missions may begin to move from traditional LDR to wideband and perhaps even broadband capabilities at 128 Kbps and above. A possible driver could come from military use for services such as Blue Force Tracking (BFT) where the U.S. Government has outlined higher bandwidth needs for future implementations. Given that the military market is expected to account for the highest revenue streams, developments such as the IsatData Pro, Iridium NEXT and others make sense in terms of market positioning to tap relatively higher paying military customers.

Bottom Line
The main missions for SCADA and M2M are being served well by LDR offerings. Over time, however, service bundling that will be key to strategic market positioning, specifically in providing a unique value proposition, should lead to an evolution of service offerings towards higher data packages. This, as they say, is the "vendor push" or supply side being driven by vendors to create product/service differentiation. Equally, if not more important, is the "market pull" or the demand side where bandwidth requirements for key verticals such as the military are dictating requirements for higher data solutions.

Together, supply and demand trends ensure an evolution for LDR requirements toward higher data rate solutions.

Information for this article was extracted from NSR's report Global SCADA, Machine-to-Machine (M2M) and LDR via Satellite Markets, 2nd Edition