KVH and the rough seas ahead for maritime satellite internet

If the big fear among satellite services providers is Starlink capsizing their traditional business models, one such business model is taking on water.

Longtime maritime connectivity provider KVH announced Feb. 13 that it is shutting down its antenna manufacturing business and laying off 20% of employees after experiencing eight straight quarters of revenue declines and five consecutive quarters of negative product margins. The proximate cause – Starlink.

With the shutdown, KVH will exit both its TracVision TV receive-only antennas (winner of 26 consecutive NMEA awards) and its TracPhone VSAT product line that the company long-claimed as a key advantage over competitors like Inmarsat, Marlink and Speedcast. Now, like its peers, KVH will now be dependent on third-party VSAT antennas.

Competitors, including Speedcast, began offering Starlink service a year earlier, but KVH waited until September 2023 to begin offering the service. KVH originally intended to offer Starlink only as a bundled service (Starlink+KVH), but was quickly forced to abandon this strategy when customers balked at shelling out ~$10,000 for KVH’s least-expensive VSAT antenna.

KVH just finished an upgrade of its VSAT network using Ku-band capacity from Intelsat and SKY Perfect JSAT to support 7,000 vessels. But now that every major maritime connectivity provider is offering Starlink, will VSAT become the new L-band of the high seas?

SOURCE: https://ir.kvh.com/news-releases/news-release-details/kvh-announces-transformative-initiatives