LUXEMBOURG - SES SA has announced that Global Eagle Entertainment (GEE) has acquired a Ku-band payload on SES's AMC-3 satellite. The AMC-3 has 24 Ku-band transponders. Given statements by GEE CEO Dave Davis, the company has acquired all 24 transponders in the deal. GEE will rebrand the acquired satellite communications payload as Eagle 1. SES will continue to operate the satellite.
Few details regarding the contract were released in a statement by SES on January 13, 2017. However, GEE revealed more details in a December 1 report filed with the U.S. Securities and Exchange Commission (SEC). In that document, GEE indicated it was in discussions with a satellite operator to purchase transponders for $50 million to "support a large aviation-connectivity customer." In a presentation at the 19th Annual Needham Growth Conference, GEE CEO Dave Davis indicated that the customer is Southwest Airlines.
The AMC-3 satellite, built by Lockheed Martin, was launched in September 1997 to provide coverage over North America, Central America, and the Caribbean. Although the satellite was originally locked in geostationary orbit at 72 degrees West, it is now non-station-kept. Maintaining a non-station-kept orbit uses less fuel than maintaining a locked orbit, making it ideal for older spacecraft that are still operational, like AMC-3.
The aviation market is a potential opportunity for satellite operators. As with customers on the ground, airlines are dealing with increased demand for data usage. Airlines are hoping to increase their appeal to customers by providing Wi-Fi in cabins. Initial providers of in-flight Internet used terrestrial cellualar networks. However, satellite connections are increasingly being seen as a way to provide global coverage with the high speeds that consumers demand.
As airlines look to increase in-flight broadband services, competition is heating up to provide the capacity for those services. An early leader in the in-flight broadband market was Gogo, which used terrestrial cellular networks to provide services. More recently, companies like ViaSat and Panasonic have moved into the market. Not to be left behind, GEE is now moving aggressively into the market by purchasing capacity on an SES satellite.
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