Satellite Industry Must Work With Wireless, Exec Says

[10-19-07 – Satellite News] The future of mobile satellite services can be seen in the terrestrial wireless market, John Mattingly, president of Mobile Satellite Ventures told about 100 space industry executives during the Washington Space Business Roundtable luncheon Oct. 16.

One of the main lessons learned as the satellite communications industry grew in the 1970s and 1980s was that the satellite network can only augment the terrestrial network, it cannot replace it, Mattingly said. MSS companies can only grow by working with terrestrial wireless companies.

"All three [MSS companies] have business relationships with terrestrial wireless, and it’s not the classic satellite-only scenario,”he said. "There’s a whole new twist in the way the evolution takes place. If you look at how we’re valued by the stock market analysts, it’s not because we’re a great MSS company, it’s because our spectrum is valuable for eventual deployment of forth generation terrestrial networks.”

Mattingly points to the early years of the satellite industry, when there were many more satellite operators in the field.

"During the 1970s and 1980s, nine U.S. fixed satellite operators were competing with each other and the ever-evolving terrestrial wire line network deployment of long-haul fiber,” he said. Then all the companies had to redo their business after the terrestrial companies all switched to fiber-optic cable, creating a glut of excess capacity.

Mattingly took those lessons learned while working for American Satellite from 1982 to 1994 and has applied them to MSV, though the current period of growth is not comparable to the mid-90s, which he calls a “period of gross speculation and over exuberance in the satellite industry.”

"I think that people who say this is just a repeat of 1995 — all these companies are building these networks just like 1995 are completely off,” Mattingly said. “This is not like Iridium and the others. The fact is it all comes down to financial discipline. I think what’s happening is as long as companies are on the right path they’ll get support. But you’re not going to be able to get way off track like you did in the 90s.”

One of the biggest problems facing the satellite industry is recruiting new talent. Workers in this generation don’t have the "pizzazz" of the Apollo program to bring them into the space industry, Mattingly said. Plus, many workers who were involved in the satellite industry in the early 1990s were scared off by the boom-and-bust cycle.

This generation "is a lot more focused on the latest gadget as opposed to space,”he said. "To compete for their attention as they become young adults and mature in their careers, you have to provide a solid career opportunity. You don’t get the automatic, ‘Wow, I’d really like to be there because it’s wonderful.’They’re saying, ‘It’s all corporate stuff, and yeah, it might be interesting, but I might like to work for Google.’”