[05-15-12] After a multi-year effort to break into one of the most valuable geographic regions for MSS services, Iridium<\/b> was awarded regulatory approval from Russian authorities to provide commercial operations throughout the Russian Federation, the satellite operator announced May 13.<\/p>\n
Iridium CEO Matt Desch estimated the value of its Russian market opportunity at $70 million to $100 million and predicted his company would capture at least 40 percent of the Russian mobile satellite market by 2015.
\n Iridium\u2019s main competitor Inmarsat is currently the only active licensed provider of mobile satellite services in Russia. Other MSS operators such as Orbcomm, Globalstar and Thuraya have received conditional approvals but must resolve technical issues, including frequency coordination and gateway construction, before launching service.
\n Raymond James<\/b> Senior Research Associate Ryan Rackley issued a report May 14 that highlighted the impact that Iridium would have on the Russian market after its official debut. \u201cIridium\u2019s network has major advantages over the other MSS providers due to the fact that Iridium can provide multiple services, such as voice, M2M, high-speed data, while offering 100 percent geographical coverage unlike its competitors,\u201d said Rackley.
\n As part of the Russian regulatory approval process, Iridium will be required to build a physical gateway in Russia during the next several years so that Russian authorities can perform \u201ccall intercept\u201d on traffic terminating in Russia. \u201cWe suspect the gateway will cost between $10 million and $20 million, spread over a period of several years,\u201d added Rackley. \u201cIridium also has already entered into distribution agreements with a handful of Russian partners but we expect Iridium\u2019s distribution network to expand quickly now that Iridium has received final regulatory approval.
\n Iridium expects to officially launch services in Russia during the second quarter of 2012. Raymond James Analyst Chris Quilty said the company would not be starting from scratch in Russia. \u201c[Iridium] already generates substantial revenues from Iridium handsets that have been smuggled into the country by remote workers serving the oil and gas, timber, construction and other industries,\u201d said Quilty. \u201cIridium does not publish country revenue statistics, but it is probably fair to assume that Iridium is currently generating several million dollars of airtime from Russia today.\u201d
\n These legacy Iridium users in the enterprise market may increase the number of subscribers and services purchased from Iridium now that the service is legal, added Rackley. \u201cIn addition, we expect Iridium to see significant uptake from the aviation, government, and other markets where \u2018unofficial use\u2019 was highly frowned upon,\u201d he said. \u201cAlthough management has been talking up the Russian market opportunity for quite some time, the scale of the market opportunity is significantly larger than we had been anticipating. Assuming Iridium can achieve its growth and market share targets, the incremental contribution by 2015 could easily exceed $20 million of EBITDA.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
[05-15-12] After a multi-year effort to break into one of the most valuable geographic regions for MSS services, Iridium was awarded regulatory approval from Russian authorities to provide commercial operations throughout the Russian Federation, the satellite operator announced May 13. Iridium CEO Matt Desch estimated the value of its Russian market opportunity at $70 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2],"tags":[],"class_list":["post-83107","post","type-post","status-publish","format-standard","hentry","category-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/83107"}],"collection":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/comments?post=83107"}],"version-history":[{"count":0,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/83107\/revisions"}],"wp:attachment":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media?parent=83107"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/categories?post=83107"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/tags?post=83107"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}