Rail traffic IoT/M2M is one market where high-speed/frequency, low-latency Iridium and a lower-cost/frequency service like Magnitude Space’s could share a customer. Iridium would get the engine, with Magnitude handling the cargo. Credit: IOT M2M Council

PARIS — Mobile satellite services provider Iridium Communications has signed an MoU with a startup Dutch company planning a constellation of low-cost, narrowband satellites for IoT/M2M applications, whose first satellite is scheduled for launch in early 2018.

For now, Iridium’s relationship with Magnitude Space BV is full of good intentions without any commitment by either party.

But Magnitude CEO Ernst Peter Hovinga said Iridium’s L-band IoT business, catering to higher-volume, low-latency applications, matches up well with Magnitude’s low-volume, high-latency UHF-band network.

Hovinga said Magnitude has already lined up initial customers for its first two satellites and is fully financed through 2018. It has begun manufacturing its postage-stamp sized user modems, designed to be integrated into a wide variety of remote assets with battery autonomy of up to 10 years, depending on data throughput rates.

“Lower-power initiatives are a key aspect of Iridium’s IoT business strategy,” Iridium IoT General Manager Tim Last said in a Sept. 7 statement. “Magnitude Space has a solid business proposition with a collaborative approach, which is ideal for this exploratory phase of our relationship. We can now discuss ways to best leverage both our network and their offerings to expand our portfolio.”

M2M/IoT is already the fast-growing segment of Iridium’s business and accounted for 29% of the company’s commercial service revenue for the three months ending June 30. Iridium’s IoT subscriber count grew 20% in the 12 months ending June 30.

Iridium’s competition at the low-bandwidth, high-latency market

But Iridium risked being outflanked on the lower-volume end of this business by the host of startup companies aiming at this section of the market with low-cost systems using cubesat technology. One of Iridium’s direct competitors in the voice/data communications space, Thuraya Telecommunications Co., announced a similar move in April by establishing a relationship with startup ELSE/Astrocast of the United States and Switzerland.

Not a month goes by without a new company announcing initial funding and a business plan that resembles Magnitude’s.

Hovinga said Magnitude’s unique selling proposition is that it will be first to market — commercial service by mid-2018 even with just one or two satellites — and the price and autonomy of its modem.

Hovinga said the company’s business plan includes generating revenue with each satellite and expanding the Low-Power Global Area Network (LPGAN) constellation only as customer demand allows.

Magnitude received initial funding through the European Space Agency’s ARTES telecommunications technology development program. The company’s satellite payloads are being developed by Hyperion Technologies, also of The Netherlands.

The satellites’ platform, integration and launch services for the 6.5-kilogram spacecraft are being arranged by Integrated Solutions in Space, also of The Netherlands. The Netherlands Space Office is also providing support, and RPC Telecommunications of Britain has provided expertise in satellite frequency registration at the International Telecommunication Union.

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Peter B. de Selding
Peter B. de Selding

Peter de Selding is a Co-Founder and editor for SpaceIntelReport.com. He started SpaceIntelReport in 2017 after 26 years as the Paris Bureau Chief for SpaceNews where he covered the commercial satellite, launch and the international space businesses. He is widely considered the preeminent reporter in the space industry and is a must read for space executives. Follow Peter @pbdes

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