JSAT, the Japanese fixed satellite services (FSS) operator, is targeting the mobile satellite services (MSS) market in Japan, because with little room for growth in its traditional business market, it believes it can boost revenues and profits through the MSS sector.
JSAT announced in August it was teaming up with Stratos Global to form JSAT Mobile Communications Inc., which will bring Stratos’ portfolio of mobile satellite services including Inmarsat and Iridium services, to the Japanese market. JSAT Mobile CEO Kei Shibuya discussed the move with Via Satellite Associated Editor Mark Holmes.

Via Satellite: What does JSAT find attractive about the MSS market?

Shibuya: We see it as a good market to expand the JSAT satellite business. We are aiming to expand the business. Inmarsat is a champion of the MSS business. The FSS business is very much a mature business in Japan. I think there will be little room for growth here in Japan. That is why we have tried to enter into the MSS field. This is very important for JSAT.

Via Satellite: Has the Japanese market demonstrated a need for more MSS services?

Shibuya: I don’t think the Japanese market has really reached its potential due to the fact KDDI has had a monopoly. I think there will be a lot of room to introduce these services in the Japanese market. I think mainly shipping companies will use these services.

Via Satellite: Why did you have to find a partner for this initiative?

Shibuya: We have specialized in FSS. We have strong experience here. We need to gather experience in MSS. We need very big help here, so that is why we have partnered with Stratos. Stratos is a number one distributor of Inmarsat services. We need their know-how. At the same time, to grow any satellite service, we need a telecoms license from the telecoms authority in Japan. JSAT has a lot of experience in this field. We think we can very easily gain a license from the telecoms authority. It is a combination of acquiring the license and gaining the know-how.

Via Satellite: When do you expect to launch services?

Shibuya: In the Japanese market, we need to gain the license to start the service. You can start the business overseas, but we are a Japanese company, so we need a license to sell our services to the home market. It will take about six months to gain the license. We expect to gain the license in either February or March.

Via Satellite: What sectors will you focus on specifically?

Shibuya: JSAT’s main markets are maritime and government. JSAT has very strong connections in terms of the Japanese government such as the coast guard and the national police agencies, as they use our Ku-band services. We have to set up these sales forces. Another challenge is to penetrate the new ship owners market. We need very strong strategic partners here. We will start conversations with Japanese government offices in order to respond to their demand.

Via Satellite: What are your financial expectations?

Shibuya: The Japanese MSS market targeted by Inmarsat services is expected be worth 18.8 billion yen ($188 million) in 2013. JSAT Mobile will be profitable from 2010 onwards.