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Viasat to Offer Ka-Band Connectivity Solution to G280 Jets

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Viasat Inc. (VSAT - Free Report) recently announced that it has been selected as the in-flight connectivity solution provider for the Gulfstream G280 mid-sized business jet airframe. Notably, the G280 aircraft will be equipped with the company’s high-speed Ka-band inflight connectivity solution. Apart from being available as a line-fit option, the Viasat in-flight connectivity system will also serve as a retrofit solution for in-service aircraft.

Viasat's high-capacity Ka-band inflight connectivity service will provide non-stop business communication and high-speed in-flight connectivity experience to fliers.  In fact, the company's high-speed Ka-band inflight connectivity service enables passengers to stream more Internet content and allows flight crews to remain connected for enhanced passenger service. Notably, this marks an excellent opportunity for Viasat to extend the offering of high-speed Ka-band in-flight service to business jet passengers.

As a matter of fact, this move will allow new G280 aircraft to be equipped with Viasat’s Ka-band connectivity system during production. Notably, speeds of 16 Mbps are expected to be offered in the initial phase. However, as the company is likely to add more capacity online, these speeds are likely to increase, going forward. Further, its offering of a live streaming feature will enable the passengers to watch TV, content and entertainment on their electronic devices.

Moreover, the Viasat Global Aero Terminal 5510 will enable broadband in-flight connectivity services on high-capacity satellite platforms of ViaSat-1, ViaSat-2 and European Ka-band. This will enable new G280 aircraft to be compatible with Viasat's broadband communications platform — ViaSat-3. Notably, the ViaSat-3 platform will help to form a global broadband network with sufficient network capacity to allow better consumer choices with an affordable, high-quality, high-speed Internet and video streaming service.

Our Take

Viasat’s in-flight Internet services are on a roll with commercial flights increasingly adopting them, and this has been driving significant revenue growth over the past few quarters. The commercial in-flight Wi-Fi business continues to make steady gains. With the surging popularity of high-engagement in-flight connectivity and high passenger engagement, leading airline companies are scouting for new ways to utilize Viasat’s high capacity satellite solutions to maximize passenger satisfaction.

Also, the company’s impressive bandwidth productivity sets it apart from conventional and lower-yield satellites providers that run on incumbent business models. Also, as ViaSat has a competitive advantage in bandwidth economics, global coverage, flexibility and bandwidth allocation, it believes that mobile broadband will act as a profit churner. Moreover, the momentous market traction of the company’s ViaSat-1 and ViaSat-2 satellites, coupled with strategically planned ViaSat 3 satellites, are expected to provide it with a solid competitive edge over its peers, thereby bolstering growth in long run.

However, Viasat expects a huge rise in R&D activities related to the launch of ViaSat-3 satellites that can materially impact its margins and bottom line, going forward. Also, strong competition from various market players like AT&T Inc. (T - Free Report) , CenturyLink, Inc. (CTL - Free Report) and Comtech Telecommunications Corp. (CMTL - Free Report) remains a threat to Viasat’s profitability.

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