The battle lines are drawn – but who really wins?

Next week sees the DigitalShip conference bandwagon land in Hamburg and the scene is set for another confrontation in the ongoing battle between Inmarsat, shipowners and competing vendors on the issue of price rises on its PAYG and E&E services.

I should declare an interest immediately and say that DigitalShip has invited me to chair day two of the conference so I expect to picking up some body parts. But apart from packing my thermals to prepare me for the bitter winds that apparently blow through the Magnushall, what else should we expect?

Well, we know that Inmarsat Maritime CEO Frank Coles will be there but his nemesis Alan Gottleib will not be, though it would be foolish to write off some interventions from his mischief-making comrades at KVH.

And for anyone who still doubts it, we will hear again that Inmarsat is a (very) commercial provider of satcoms to maritime, aero and land mobile markets. Its decision to raise prices on E&E and PAYG services represents a desire to improve earnings and so reward shareholders for whom shipping is another commodity business among many.

It may piss people off – and it has – but anyone that calls Inmarsat a monopoly in this era of choice and competition is missing the point. Inmarsat has been called many things: the biggest player in the market, certainly; the best-looking girl at the dance, perhaps; but the fact is that it operates a network that enables users to connect globally and at prices which are readily and transparently available from their re-sellers.

Is it throttling smaller customers? So its detractors claim. But the fact is that DPs and SPs (and not just Stratos) continue to offer small MB packages for owners that prefer to work that way. What confuses me (and perhaps owners too) is that Inmarsat is accused of removing small data plans by the same people who also want to upsell them to large data bundles.

Are Inmarsat’s motives hidden? Does it plan to corner both the airtime market and that for applications as has been suggested elsewhere this week? It’s possible, but I think doubtful. If nothing else, Inmarsat understands its place in the satcoms universe.

It could even be said that the amount of attention Frank Coles has drawn to the spoutings of KVH and others on LinkedIn overstates their importance. Preaching to the choir, like picking one’s nose, generates limited returns.

And besides, there are too many competing options to allow for complacency.

When I covered Inmarsat for Lloyd’s List in the 2000s, just as VSAT was starting to nibble away at the edges of L-Band, Inmarsat was a more timid beast, fearful of being assertive and risk backlash and censure. The competition liked that because it gave them room for manoeuvre.

What we have now is the opposite – a confident company with a strategy which is less focussed on chasing road warriors than it is serving a core maritime demographic. Does that piss off the competition and its consultants? Of course.

So what to expect next week? A bullish defence from Inmarsat for sure, but will we see an insurrection from users? The evidence suggests not. As the saying goes, you get what you pay for and that doesn’t mean that prices stay the same for ever.

In a couple of weeks hence, Coles meets Gottleib at the rather more commercial ACI satcoms event and perhaps there we will see (self-styled) David take on Goliath.

But I still wonder what the core takeaway message will be from both events. I think it is this. Users do have choice and they also have dollars, if fewer to spare than once they did. To focus on cost above value without any reference to the bigger picture is to miss a gaping opportunity.

But there is change already apparent.

After all, at DS Athens, it was the IT departments who came forward to say that they needed to work more closely with the ops and chartering department, to break out of their silos and upsell the opportunity that better communications presents.

It seems to me that regardless of the channel they use, grasping the opportunity to save costs and drive efficiencies is more profitable than simply comparing competing offers. Quality of service, reliability and coverage should be the determining factors.

And from a quick glance at the programme for next week it becomes clear that the industry is already grasping the opportunities that better communications presents. Airtime providers should do themselves a favour and focus on their customers rather than each other.