We are a leading manufacturer of solutions that provide global high-speed Internet,
television, and voice services via satellite to mobile users at sea and on land.
We are also a leading provider of commercially licensed entertainment, including
news, sports, music, and movies, to commercial and leisure customers in the maritime,
hotel, and retail markets. In addition, we develop and distribute training films
and eLearning computer-based training courses to commercial maritime customers.
We are also a premier manufacturer of high-performance navigational sensors and
integrated inertial systems for defense and commercial inertial navigation applications.
Our reporting segments are as follows:
the mobile connectivity segment and
the inertial navigation segment
Through these segments, we manufacture and sell our solutions in a number of
major geographic areas, including internationally. We generate revenues from
various international locations, primarily consisting of Canada, Europe (both
inside and outside the European Union), Africa, Asia/Pacific, and the Middle
East.
The mobile connectivity segment primarily manufactures and distributes a comprehensive
family of mobile satellite antenna products and services that provide access
to television, the Internet and voice services while on the move.
In the global maritime market, we believe that there is significant demand for
mobile access to television, the Internet, voice services, entertainment content,
and operational services such as safety training, navigation chart updates,
weather services, and voyage optimization. For both maritime and onshore customers
that want to access live television while on the move, we offer a comprehensive
family of mobile satellite antenna products marketed under the TracVision brand.
For access to the Internet and voice services while on the move, which we refer
to collectively as our airtime services, we offer a family of mobile satellite
antenna products and communication services marketed under the brands TracPhone
and mini-VSAT Broadband. The network infrastructure that we have developed to
support our airtime services also supports the delivery of other value-added
services over our IP-MobileCast content delivery service for both entertainment
and operational needs.
Our mobile satellite antenna products use sophisticated robotics, stabilization
and control software, sensing technologies, transceiver integration, and advanced
antenna designs to automatically search for, identify and point directly at
the selected television and communications satellite while the vehicle or vessel
is in motion. Our antennas use gyros and inclinometers to measure the pitch,
roll and yaw of an antenna platform in relation to the earth. Microprocessors
and our proprietary stabilization and control software use that data to compute
the antenna movement necessary for the antenna’s motors to point the antenna
properly and maintain contact with the satellite. If an obstruction temporarily
blocks the satellite signal, our products continue to track the satellite’s
location according to the movement of the antenna platform in order to carry
out automatic, rapid reacquisition of the signal when a direct line of sight
to the satellite is restored.
Satellite TV. Our TracVision TV-series satellite TV antennas, are designed
with the full spectrum of vessel sizes in mind, ranging from recreational vessels
as small as 20 to 25 feet to large commercial vessels. The TV-series incorporate
an Internet Protocol (IP)-enabled control unit to allow access to system information
from any Wi-Fi device. Our family of marine TracVision products includes the
32-cm diameter TracVision TV1, 37-cm diameter TracVision TV3, 45-cm diameter
TracVision TV5, 60-cm diameter TracVision TV6, and 81-cm TracVision TV8. These
products are compatible with Ku-band HDTV programming as well as high-powered
regional satellite TV services around the globe, based on available signal strength
and antenna size requirements.
Our TracVision HD-series satellite TV antennas are designed to offer a high
definition TV experience comparable to that available to a home DIRECTV HDTV
subscriber. Our TracVision HD7 uses a 61-cm diameter satellite TV antenna to
receive signals from two DIRECTV Ka-band satellites and one DIRECTV Ku-band
satellite simultaneously. It includes an IP-enabled antenna control unit as
well as an optional antenna control unit via a free TracVision application for
use on an Apple iPhone or iPad. We believe the TracVision HD7 was the first
marine antenna to offer this combination of capabilities. Our TracVision HD11
offers a worldwide satellite TV capability through the use of a 1-meter diameter
antenna and a global low noise block (LNB) designed for use with the majority
of direct-to-home satellite TV services. As a result, it is able to receive
all Ku-band and DIRECTV Ka-band satellite television signals without changing
out hardware elements. The Ku-band also works with modern satellite television
services currently available throughout the world. The Ka-band receives DIRECTV
HDTV. Like the TracVision HD7, it features an optional application for the Apple
iPhone or iPad to provide easy control of the system.
Satellite Phone and Internet. Our mini-VSAT Broadband network offers an end-to-end
solution for offshore mobile connectivity. This unified C/Ku-band Broadband
service enables us to offer commercial, leisure, and government customers an
integrated hardware and service solution for mobile communications and seamless
region-to-region roaming. We design and manufacture the onboard TracPhone V-IP
terminals, own hub equipment installed in leased earth stations, lease the satellite
capacity, manage the network through third-party service providers, and provide
24/7/365 after-sale support. Because we manufacture the onboard hardware, we
can integrate the full rack of discrete below decks equipment typically used
on traditional VSAT systems into a single, streamlined unit that is significantly
easier to deploy than competing VSAT solutions. Our mini-VSAT Broadband network
utilizes ArcLight spread spectrum modem technology developed by ViaSat. This
spread spectrum approach reduces the broadcast power requirements and the pointing
accuracy necessary to track the C- and Ku-band satellites that carry the service.
The resulting efficiencies allowed us to develop and bring to market our TracPhone
V-IP series of terminals. Our 60-cm diameter TracPhone V7-IP Ku-band antenna
is 85% smaller by volume and 75% lighter than alternative 1-meter diameter VSAT
antennas. Our 37-cm diameter TracPhone V3-IP Ku-band antenna is practical for
use on smaller vessels as well as land vehicles. We believe that the TracPhone
V3 is the smallest maritime VSAT system currently available. Our dual-mode TracPhone
V11-IP antenna seamlessly tracks both C- and Ku-band satellites, making it the
only 1-meter diameter maritime VSAT antenna to deliver seamless global coverage
outside the far polar regions.
Land Mobile
We design, manufacture, and sell a range of TracVision satellite TV antenna
systems for use on a broad array of vehicles, including recreational vehicles,
buses, conversion vans, and automobiles.
In the RV and bus markets, we offer TracVision satellite TV products, intended
for both stationary and in-motion use. Our TracVision R1 delivers DIRECTV or
DISH network service through a small 32-cm diameter dome. Our TracVision A9
uses hybrid phased-array antenna technology to provide in-motion reception of
satellite TV programming in the continental United States using either the DIRECTV
or DISH Network services. The TracVision A9 stands approximately five inches
high and mounts either to a vehicle’s roof rack or directly to the vehicle’s
roof, making it practical for use aboard minivans, SUVs and other passenger
vehicles. The TracVision A9 includes a mobile satellite television antenna and
an IP-enabled TV hub for easy system configuration and control via Wi-Fi devices,
such as an Apple iPhone or iPad. The TracVision A9 is also suitable for tall
motor coaches and buses. Automotive customers subscribe to DIRECTV’s TOTAL
CHOICE MOBILE satellite TV programming package, which is specifically promoted
for automotive applications, or to DISH Network programming.
Airtime Services
In addition to our mobile satellite antenna hardware and software, we offer
airtime plans that enable customers to obtain Internet and voice services. We
offer a variety of rate plans that typically require an initial commitment of
one or more years with a one-year auto-renewal feature. Since October 2015,
we have offered mini-VSAT Broadband 2.0, our second generation mini-VSAT service.
The key features of the mini-VSAT Broadband 2.0 service are usage-based airtime
plans, a new network management portal and a new comprehensive global customer
support program. Our usage-based plans, which are designed around each vessels
monthly data requirements for operational and crew needs, deliver data at higher
speeds. Our network management portal, myKVH, is a secure portal that enables
a ship operator to manage network usage by vessel or by individual crew members
by allocating operational and crew data caps while receiving customized usage
alerts. For customers that want the certainty of a fixed monthly price, we offer
fixed rate plans that vary depending on data speeds and include protocol restrictions,
such as limiting streaming of video content. User speeds are also restricted
but not stopped when users reach established data use thresholds. In addition,
we offer multiple usage plans that are either billed monthly based on the data
consumed without any application or protocol blocking or based on a monthly
minimum data quota with the option to add more data for an incremental charge.
The TracPhone V3-IP requires a usage-based plan while the TracPhone V7-IP and
V11-IP can support any plan.
In April 2017, we launched a new mini-VSAT Broadband service offering, AgilePlans.
AgilePlans is our all-inclusive connectivity-as-a-service, or CaaS, usage-based
pricing model for commercial maritime customers of our mini-VSAT broadband service.
Under this CaaS model, we charge subscribers a monthly fee in exchange for which
we provide satellite communication hardware, shipping and installation, maintenance
and support, airtime and voice services, a service management portal and certain
basic content services with no minimum commitment. We offer AgilePlans customers
a variety of airtime data plans with varying data speeds and fixed data usage
levels with overage charges per megabyte, which is similar to the plans that
we offer to our other customers. Under this new model, we retain ownership of
our satellite equipment and do not sell it to subscribers, who must return the
hardware to us when they terminate our service. We anticipate that, to the extent
that customers adopt this new subscription model, our revenues from product
sales will decline, and our provision of this equipment to subscribers will
increase our capital expenditures, which over time will increase our costs of
product sales as we depreciate these assets.
The high bandwidth speeds offered by the Ku-band satellites also permits faster
data rates than those supported by Inmarsat’s L-band satellites. TracPhone
V11-IP customers may select service packages with Internet data connections
offering shore-to-ship satellite data rates as fast as 4 megabits per second,
or Mbps, and ship-to-shore satellite data rates as fast as 1 Mbps. The V7-IP
offers shore-to-ship satellite data rates as fast as 3 Mbps and ship-to-shore
data rates as fast as 512 kilobits per second, or Kbps. The TracPhone V3-IP,
due to its smaller dish diameter, offers shore-to-ship satellite data rates
as fast as 2 Mbps and ship-to-shore data rates as fast as 128 Kbps. In addition,
subscriptions include Voice over Internet Protocol (VoIP) telephone services
designed for use over satellite connections. The TracPhone V11-IP and V7-IP
can support two or more simultaneous calls while the TracPhone V3-IP can support
one call at a time.
Our mini-VSAT Broadband network currently uses a combination of 23 Ku-band transponders,
of which we own 14, and three global C-band transponders, all of which we own,
on 19 satellites to provide Ku-band coverage throughout the northern hemisphere
and around the continents in the southern hemisphere, and C-band coverage world-wide.
It is our long-term plan to continue to maintain and enhance our mini-VSAT Broadband
network. Under the terms of our revenue sharing arrangement with ViaSat, expansions
of our ViaSat network position us to earn revenue not only from the maritime
and land-based use of the mini-VSAT Broadband service but also from aeronautical
platforms that roam throughout our network.