With the recent ruling by the Federal Communications Commission reaffirming its decision to allow satellite operators to integrate ancillary terrestrial components (ATC) to existing Mobile Satellite Service (MSS) systems (SN, Feb. 14), the next challenge for the MSS sector will be to deploy ATC and applications that take advantage of this terrestrial component to expand the reach of MSS, particularly in urban areas.

At a March 15 brown bag lunch hosted by the Mid-Atlantic Chapter of the Society of Satellite Professionals International, Jennifer Manner, vice president of regulatory affairs at Mobile Satellite Ventures (MSV), offered some hints as to where MSV is looking to take ATC.

In particular, she noted that within four years, it could be possible to see consumer devices as small as a Blackberry that would offer true ubiquity in terms of coverage. She added that MSV’s first generation ATC system could be deployed in the next 18 months.

Manner touted some of the features of an ATC system that will enable it to compete not only in the consumer space, but in other markets as well, such as public safety. In particular, she said the ATC component would provide not only for communications access in areas such as urban canyons where satellites currently have some difficulty reaching, but in-building penetration as well.

Manner also noted that ATC could play a significant role in the future for extending the reach of broadband services and could become “a third competitor to the home” alongside cable and DSL services. Manner, who prior to joining MSV, served as senior counsel to FCC Commissioner Kathleen Abernathy. She said that ATC was a part of the FCC’s broadband policy goals.

Edward Berger, vice president at Inmarsat, also voiced his support for ATC and noted that with the opportunities that ATC opens up, demand for ATC services cold drive down equipment costs and application development costs, making an integrated MSS/ATC network a more cost-effective option for those who need that kind of ubiquitous coverage.

Who Will Pay For It?

While there did not seem to be questions from a competitive perspective regarding what ATC means in terms of providing MSS access to sectors that it may not be able to compete in currently, a bigger question that may be looming for MSS companies looking to rollout ATC networks is the cost.

Edward Berger quantified ATC deployment as “a multi-billion dollar rollout that would require a wide collaboration of partners.”

And with a rollout estimate that high, it creates a “chicken and egg” scenario for those looking to deploy services that take advantage of ATC. The network would have to be there before an MSS provider could obtain the critical mass necessary to drive down the costs, but potential subscribers may not be willing to pay for service and equipment on a widespread basis if the network is not deployed in a wide-enough fashion to elevate MSS out of the niche market realm that it currently resides, into a more widely accepted alternative to either terrestrial wired or wireless communications.

Berger added that the cost of the service is going to be a key factor for adoption. He pointed to the direct-to-home (DTH) satellite television market as an example of how MSS/ATC services need to be priced if there is going to be widespread consumer adoption, noting that DTH services are priced comparatively with current terrestrial cable offerings.

Iridium To Wait And See

While MSV and Inmarsat are looking closely at ATC as part of their respective business plans going forward, Iridium Satellite LLC is not jumping into the ATC pool just yet. Globalstar, which was not represented during the lunch, announced earlier this month that it filed for ATC authority with the FCC.

“It depends on where the market moves,” said Donna Murphy, vice president of regulatory engineering at Iridium. She noted that Iridium’s major markets–maritime, aviation and government–are served without a terrestrial component.

–Gregory Twachtman