Inmarsat scents China opportunity

Satellite firm set to invest more into wide-area communications

The very first goods Chinese traders brought to the United Kingdom via the ancient Silk Road were Chinese silk, tea and porcelain.

Today, the government's Belt and Road Initiative, with goals to strengthen connectivity between Asian, European and African countries, is likely to create greater opportunities for UK companies but in ways we may have never foreseen.

Inmarsat Plc, a leading UK provider of global mobile satellite communication services, said the initiative, which is expected to see increasing reliance on wide-area communications, will create new opportunities for the London-based company.

"The Chinese government, enterprises and even consumers would want to access broadband communication services on the move on land, at sea and in the air, globally," Rupert Pearce, chief executive officer of Inmarsat, told China Daily.

Citing China's State-owned broadcaster China Central Television, Inmarsat's biggest client in the nation's media industry, as an example, he said CCTV uses the company's services in many cities around the world to transmit its news programs to Chinese audiences.

Europe, the Middle East and Africa accounted for most of Inmarsat's $1.29 billion revenue in 2014. But Pearce is excited about its growth potential in China.

"Our business in the Far East is not the largest yet but it is the fastest growing region, and among all the areas in the region, China is the fastest-growing country. So we are very excited about the prospects and we will continue to put a lot of resources in the Chinese market," he said.

The company, which set up its first office in China in August last year, has seen double-digit growth in the Chinese market over the past year, which is extraordinary compared with the company's growth of about 2 percent in revenue in 2014.

Pearce said he expected to see even more bullish growth in the China market as the firm has just launched its third satellite in the transformational Global Xpress, which is expected to deliver mobile broadband connections to even the remotest and most inaccessible parts of the world with high speed and at low costs.

The customer base in China is rapidly growing and expanding internationally, which needs a strong communication platform to support growth outside China, he said, adding this new service will not only help existing customers but also take the company to new markets like the energy industry.

"Looking forward, one area that has explosive growth potential is passenger connectivity in aircraft," he said. Inmarsat is working with several major airlines in China but mainly for operational communication. "But elsewhere in the world, we see extraordinary interest from major airlines to connect their passengers in the air," he said.

Three major Chinese airlines, including China Eastern Airlines, China Southern Airlines and Air China, got permissions in June to provide in-flight Wi-Fi services. According to media reports, around 390 million Chinese passengers took domestic flights and spent 1 billion hours in the air in 2014.