07-09-2004 - Inmarsat today announced the December 2006 withdrawal of its Inmarsat EPIRB service and committed to new generation safety service on its I-4 satellites
Inmarsat, the Total Communications Network via satellite, today announced the December 2006 withdrawal of its Inmarsat EPIRB service and committed to new generation safety service on its I-4 satellites. In almost eight years since its global introduction, the service has less than 1300 users worldwide of which less than 100 are within the merchant marine fleet for which it was designed.
Comments Brian Mullan, Head of Maritime and Aeronautical Safety Services at Inmarsat: "Inmarsat has provided Global Maritime Distress and Safety Service (GMDSS) since its inception, assisting in the preservation of life at sea. We remain fully focused on this task".
Almost 100,000 GMDSS Inmarsat terminals are today used on board ships worldwide, of which more than 66,000 are Inmarsat C. Indeed, the success of Inmarsat C has seen it become known as the cornerstone of the GMDSS.
Inmarsat, as part of its commitment to improving safety of life at sea, invested in the development of an emergency position indicating radio beacon (EPIRB) service during the late 1980s and early 1990s. The European Space Agency also invested in the development of the service. This L-Band EPIRB service became known as Inmarsat E and has been in full, global operation since 30 January 1997.
However, after nearly eight years, there are still less than 100 L-Band EPIRBs fitted to GMDSS ships. At the end of August, there were less than 1300 L-Band EPIRBs fitted worldwide - with more than 60% being fitted to leisure craft.
Retail costs of the L-Band EPIRBs are significantly higher than for the near-equivalent 406MHz EPIRBs with GPS capability. This has been a major contributory factor in the small population and slow growth rate. It has therefore never been possible to increase numbers to a level where volume production efficiencies could make prices more competitive. This situation is not expected to change significantly in the foreseeable future.
Continues Mullan: "The digital receiver processors (DRPs) in the L-Band ground infrastructure equipment are ageing and must be replaced in their global entirety before the end of 2006. The current maintenance contracts expire at the end of 2006 and the maintenance contractors advised recently that these will not be renewed due to anticipated unavailability of spares after that time".
Because of the significantly high costs of continuing to maintain a system that has not been widely adopted as a core element of the GMDSS, Inmarsat has involved its independent oversight body, the International Mobile Satellite Organisation (IMSO) and has advised the Maritime Safety Committee of the International Maritime Organisation (IMO) that the L-Band EPIRB system will be withdrawn from 1 December 2006.
Andrew Sukawaty, Chairman and CEO of Inmarsat adds: "We remain committed to the safety of our customers. Perhaps uniquely for a commercial business, Inmarsat will provide, free of charge, a 406MHz EPIRB with GPS and of equivalent capability, to every existing user of the L-Band EPIRB system".
This programme of replacement will be carried out during 2006, with every existing user being contacted by letter. Meantime, Inmarsat's planned programme of replacement will ensure that every existing user will be offered a replacement EPIRB cover in good time.
Inmarsat has already begun a significant programme of focussed investment in safety of life at sea. This follows the recent and successful investment programme that led to the introduction of Inmarsat Fleet F77 as a new element of the GMDSS. New equipment that will take Inmarsat safety services into the future is planned and is expected to enter service within the next decade. Because of the importance of equipment for the GMDSS, this will require a high degree of human resource and capital investment on Inmarsat's part.
Meantime, Inmarsat and its manufacturing partners have already instigated a programme of support for the IMO International Search and Rescue (SAR) Fund. Inmarsat has already committed $10,000 for the next five years from 2005, to support the IMO International SAR Fund. Two Inmarsat manufacturers will provide, free of charge, a significant amount of safety communications equipment. This includes four Inmarsat Fleet F77s and two Inmarsat mini-Cs, which will be used at new rescue coordination centres in sub-Saharan Africa.
Inmarsat also places maritime safety education high in its aim of supporting safety of life at sea and has therefore already committed $100,000 per year, for 2004 and 2005, to the World Maritime University.
Inmarsat remains fully committed to its public services obligations in providing safety services and will continue to focus its efforts and its investment in those areas that will make the greatest contribution to safety of life at sea.
Forward-looking Statements
Certain statements in this announcement constitute "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those projected in the forward-looking statements. These factors include: general economic and business conditions; changes in technology; timing or delay in signing, commencement, implementation and performance of programmes, or the delivery of products or services under them; structural change in the satellite industry; relationships with customers; competition; and ability to attract personnel. You are cautioned not to rely on these forward-looking statements, which speak only as of the date of this announcement. We undertake no obligation to update or revise any forward-looking statement to reflect any change in our expectations or any change in events, conditions or circumstances.
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