US satcom provider Viasat has declared it will appeal a British tribunal ruling that rival European operator Inmarsat had not breached its licence by becoming part of an EU-wide satellite broadband network.
Not only did Ofcom in October 2017 brush aside the American firm's challenge against Inmarsat's use of its 2GHz spectrum for the EU Aviation Network but on Friday (7th December) the Competition Appeal Tribunal (CAT) upheld Ofcom’s initial decision.
Viasat first aimed a legal kick at Inmarsat after the latter won an EU contract in early 2017, the European Aviation Network (EAN), to set up a ground-and-satellite broadband network intended to compete with existing in-flight Wi-Fi products.
While Inmarsat was authorised by Ofcom in the UK to operate a mobile satellite system using its 2GHz spectrum, the US firm argued that the EAN equipment for an airliner did not fall within the EU legal definition of a mobile satellite system, which would have made Ofcom’s authorisation to Inmarsat against the law.
Viasat boss Rick Baldridge (previously a veep, now the firm’s prez and COO) told The Register last year:
“Inmarsat was not compliant with its licence,” and dismissed our suggestion to him that this was just commercial sour grapes by saying: “If I have to adhere to regulations and another does not, we don't know how to play in that area… What was presented and what transpired were two different things."
Had Viasat known an EAN-style system was on offer, they would have snapped up a slice of the spectrum and built their own competing product, the company said.
Although Ofcom initially ruled against Viasat at the start of this year, in reality the UK comms regulator had no choice but to rule in Inmarsat's favour thanks to the EU regulations and decisions which created the EAN. These mean that because the EAN is an EU creation, only EU bodies really have the power to hear challenges against it, the idea being to prevent fragmentation of the EAN through local decisions.
The CAT itself noted: “The structure of the authorisation scheme is designed to prevent a fragmentation of approach to matters affecting the scheme as a whole.”
At its simplest, the proposed EAN network consists of ground-based LTE base stations provided by Deutsche Telekom integrated with coverage from an Inmarsat satellite to provide more-or-less seamless Internet connectivity, with the satellite providing coverage for areas the ground towers do not reach. Airliners are fitted with two aerials, one on their upper surfaces and one underneath, respectively talking to the satellite and the ground stations.
Viasat’s other legal arguments – that Ofcom’s decision broke various EU laws as well as authorised Inmarsat to do something it had no power to authorise – were also dismissed by the CAT in a 72-page ruling published on Friday afternoon, which noted in passing: “Viasat cannot invoke the doctrines relied on in the manner which it seeks to deploy.”
An Ofcom spokesperson told The Register: “We are pleased that the Competition Appeal Tribunal has rejected Viasat’s appeal on all grounds and upheld Ofcom’s decision. This is a good outcome for consumers, enabling Inmarsat to continue working with airlines to provide on-line services to their passengers.”
Viasat vowed to appeal, saying: “We will take all necessary steps to appeal this decision. The Court’s interpretation of the law, and in particular its conclusion that a mobile satellite system can rely on ‘complementary ground components’ to provide over 99 per cent of the service’s bandwidth, is wrong and runs directly contrary to both the law’s intent and plain meaning.”
Fly-high broadband satellite won’t be very good… on its own
The tribunal also said that, from the evidence it heard, the EAN satellite’s “maximum capacity is 42.1Mbits/s or 19 Gbytes/hr and the ground cells’ aggregate capacity was 34,268 Mbits/s or 15,421Gbytes/hr.”
It added, after hearing figures from experts: “What we can say is that those figures demonstrate that the satellite by itself can service no more (and probably less) than 2 aircraft on the high load scenario, and something like 20 aircraft on the low load scenario.” The high load scenario was expressed as 50 per cent of passengers aboard an airliner “streaming, browsing and using social media”. The low load scenario's details were redacted from the judgment because it revealed commercially sensitive information.
Given the design intent of the EAN, the airliners under discussion are likely to be Boeing 737 or Airbus A320-type airliners capable of carrying around 180 people at a time. No specifics were given in the judgment, though it noted that “there are on average 550 shorthaul planes flying above Europe at any one time”.
Nonetheless, only around eight per cent of European flights (“44 aircraft”), according to the evidence shown to the tribunal, are expected to need the satellite instead of the ground stations. The CAT said: “If only half of those were fitted with EAN then the low load scenario would be capable of being fulfilled in respect of practically all those planes,” while adding that these projections may not “necessarily reflect the real world operation of the system.”
One airline had reportedly expressed interest in adopting only the ground components of the EAN. ®