VSAT: Value for your business, not just an antenna.
The first satellite networks were geared towards improving the safety of the seafarers and their vessels. As technology advances, the need to transfer data between vessels and their shore offices has increased to enable them to perform their tasks more efficiently and much faster than the old traditional methods.
The well known L-Band services have been the dominant technology used on board many vessels; however, these services can jack up your monthly bill if the services were used extensively due to the per-megabyte price structure, especially if you exceed your monthly package. The VSAT network has always been available as an alternative option for satellite connectivity. However, the high cost of the Single Channel Per Carrier (SCPC) technology used to dedicate and manage bandwidth on board the vessels made the VSAT solution a lot more expensive than the L-Band counterpart. The introduction of Time Division Multiple Access (TDMA) VSAT network has helped slashing the high pricing level and make it comparable to the L-Band services. With the new VSAT technology, segmenting and controlling the bandwidth across the vessels were made very easy and very affordable to every marine client nowadays. The VSAT networks are surpassing the L-Band services in terms of speed, always-on and a flat price structure. Having said that, the new VSAT network has become more popular and affordable to many marine clients and the preference to switch from the L-Band to the VSAT Ku-Band (upgradable to Ka-Band) is becoming the new trend. Why? Simply because of the so many values that the VSAT technology is offering to the marine clients including values directly related to the crew welfare.
VSAT networks enable the marine client to build an advanced network on-board the vessel that can deliver strategic business values to their end users and offer solutions for the complex demands and challenges that both ship owners and operators face. Moreover, the VSAT technology has included the crew in its new development and also offers them many different ways to stay in touch with their beloved ones on shore.
So VSAT: What’s in it for me?
It is usually the senior level management that takes the decisions on implementing solutions such as enterprise resource planning (ERP), CRM, ORACLE, ECDIS and any other regulatory technology to ensure compliance with IMO or SOLAS requirements and so forth. In order to deploy all these applications, you will need a solution that is very fast, always on and offers fixed rate IP connectivity. Accordingly, all the investments in various technologies that are geared towards improving business operations and processes are in jeopardy if these solutions don’t have a solid communications backbone to help support them. VSAT offers the speed that you need for your business. A smooth running operation requires speed and bandwidth. VPN will require a good chunk of bandwidth as well, which also translates to speed.
The VSAT flat rate data bundle is offered through different speed packages rather than data volume packages, as in the L-Band services for example. So once the speed rate is selected, then the ship will get unlimited data at that particular speed. By doing this, the VSAT offers the convenience of consolidating your bills without having to worry about tracking data for financial reasons such as crew accounting, expense tracking and so forth. All your communications rely on one monthly fixed bill when it comes to the data package selected without worrying about going over your package limit.
Another benefit that VSAT can offer you is the bandwidth management. As a ship owner or operator, you will be able to control the bandwidth to serve your operations more effectively. You will have many scenarios of customizations to choose from such as dedicating part of the bandwidth to the senior officers on board to do their commercial activities, and you can also dedicate a pool of data to be shared with your crew. So the first value that VSAT offers to businesses in improving efficiency and develop your business processes.
Another interesting value that VSAT offers is directly related to crew welfare. When you have a VSAT fitted on board your ship, you will be able to use the bandwidth manager to provide the crew with internet and VOIP telephony so they can get in touch with their loved ones on shore. Most of the crew members have more than one smart device on board with them. Whether it is a smart phone, a laptop or a tablet, the need to get online triples at this point. It is known in the marine industry that crew will jump ships once they find internet availability on board another ship. So extending the VSAT connectivity to your crew members will make them happy and will result in a better crew retention rate for the ship operators.
The high speed VSAT connectivity can offer the ship operator a way to reduce their monthly communication cost by using the crew calling technology available with the VSAT setup. The crew calling platform provides the ship operator the ability to sell pre-paid PINs to the crew members. This way, the ship owner can reduce the communication monthly cost by selling pre-paid PINs to the crew. So in a sense, the crew will be paying some of communication cost rather than having the ship owner or operator bear the entire cost. Of course this policy is different from one company to another. Some companies are happy by providing free internet access to their crew. In either scenarios, the VSAT technology can offer this setup for your crew.
There is no doubt that the VSAT technology is a necessity when it comes to upgrading the business processes and systems. People invest in technology to improve their current situations and make them more efficient. Whatever applications or programs out there that are designed to automate businesses and increase their efficiency are technically useless if they don’t work properly. So having a cheaper solution like the L-Band services will result in paying way too much and working on a much slower speed. The L-Band price structure is based on the pay-per-megabyte and the maximum speed that the L-Band offer is 456k (shared). On the other hand, VSAT can offer “ALL YOU CAN EAT DATA” package with speed that can go up to 8MB (shared) and up to 2MB (dedicated channel).
The immediate benefits and values that the VSAT will bring to the business are not comparable to any other services and that’s why VSAT is gaining so much popularity in the maritime sector nowadays.
Drivers and barriers to fitting VSAT onboard
Even though VSAT is gaining popularity, some ship owners and operators haven’t fully comprehended the opportunity of a much faster internet connectivity and what that means to their business.
In the vast majority of cases, the senior management’s involvement in the decision making process in regard to Sat Com connections comes at the final stage. Ship operators clearly lack a robust approach to quantifying the values, benefits and cost savings of the potential VSAT network across all business departments and the operation as a whole. In most cases, senior managers are presented with a business case study conducted by the IT department or Fleet managers who are comparing prices of the VSAT and their existing communications on board.
Neither IT personnel, nor fleet managers have the responsibility of managing the business or even invest time in understanding the value that VSAT can offer to the companies they are working for. Their primary job is to work around an assigned budget and think within the parameters of their departments only. Accordingly, most of the time the VSAT proposals turns to a pure price comparison rather than value comparison.
Another obstacle is the IT department’s lack of understanding of satellite connectivity. There are many IT people who think that the terrestrial internet works exactly the same way as satellite internet. Not considering mobility, latency and how the technology is priced often result in demanding solution by the IT department that works perfectly on land and they have no clue how it works or costs in the sea. Most of the IT people live ashore, so their exposure to internet is heavily based on terrestrial internet. It is not common to meet IT people who specialize in satellite internet and work on board the vessel as opposed to offices on the shore. Hence, the IT department itself can be an obstacle towards fitting a VSAT because most of the time they look at the proposal from a pure cost point of view rather than a value proposal. Ironically, the IT department understands the value of ORACLE, for example, and is also willing to pay big bucks for it, but when it comes to the communication backbone for it, they chose a cheap solutions that will definitely suffocate ORACLE due to lower speed of the L-Band services or the selection of the slowest speed VSAT package because it is “cheapest” among other speed packages. So the investment goes on the application, but not on how to make it work more efficiently.
VSAT might be three times more expensive than the L-Band counterpart; however, the business values that are offered to any marine client are unmatched by any other existing technologies. Nowadays, many companies are investing heavily in technology in order to increase their efficiencies and develop their existing processes. It makes no sense to pay top dollar for up-to-date solutions without having any solid means to deliver their benefits across all the business’ departments. Otherwise, you have a dead investment.
So How do I choose what is good for me?
Ship operators usually have a long list of demanding and complex requirements, a need to access education and various trainings. Investing in technology is becoming the number one sought after business strategy that will enable ship operators to improve their business processes. When it comes to choosing the right technology for a ship operator, they will need to evaluate the purpose of technology needed. In most scenarios, ship operators may not have a comprehensive understanding of satellite communication or how it works. For example, many ship operators don’t know the difference between L-Band and Ku/Ka Band services or any other equivalent services out there like C-Band..etc. This fact may result in a costly solution for the ship owners and/or operators and pay a lot more for what they wanted to achieve by choosing the wrong services for the sake of getting internet onboard. So how should you approach that decision?
- As a ship owner and/or operator, have a clear understanding of what you want to have on board your vessels and for what purpose. Communication is the engine that drives business development and offers the ability to scale and grow your business. If you are investing in technology by deploying advanced systems, like ORACLE, ERP, CRM..etc, then satellite communications should be treated as an integral component of the technology bundle that you want to bring into your business.
- Communications cost constitutes up to roughly 2% – 2.5% of the entire operational cost of the vessel. The average VSAT monthly data package is about USD $3500. So what VALUES does this monthly payment is bringing to your business? Does it offer the speed needed to have onboard to maximize the utilization of other technologies you have invested in? Did it reduce other indirectly related costs in other departments? Did it help automate your business and its processes? If you are going to have satellite internet on board your ship, then the values that you want to bring to your business through internet connectivity will dictate the size and the speed of the data package needed to operate your business more efficiently.
- Choosing a provider for your connectivity needs is a lot more than just a quotation offered to you. Your provider should be your communications “partner” as opposed to merely a “supplier”. The provider’s local presence in either the same country or the same region of vessels’ operations is a big value for your business in terms of your connectivity support and troubleshooting issues. Engineers’ attendance can be costly sometimes. So if the engineers are present locally or have the ability to be present in a short notice, then support will be a lot less costly in the long run. It actually saves you money. You should consider the engineer’s flights and accommodation in case the provider doesn’t have a local presence in your region of operation.
- Choose a provider that not only does understand your operation, but also has the right tools to support you better. Try to AVOID providers that:
- Are acting merely as the “middle-man” between you and the Satellite owner/operator and don’t have proper “control” over the services they provide or have the ability to accommodate your needs, like billing structure, bandwidth management ..etc. Those middle-men simply receive the invoice from the satellite owner/operator, tag on their profit margin and bill you directly. All support issues can be delayed due to the lack of a proper support setup. Engineers’ availability, after sales support and a way for you to be in control of your data subscription are key factors that you should examine while choosing the right provider.
- Lack the ownership of a Network Operating Center (NOC). The NOC is where the monitoring and the maintenance of the connectivity you are receiving takes place. If your local provider has a NOC then you will be able to get more value added services to your business that will enhance your experience of having onboard satellite internet connectivity.
- Hire trained technicians as opposed to certified engineers. Satellite antennas and the Below Deck Equipment (BDE) are not cheap. Service them well and protect your investment. Ask the provider if the engineers are certified to operate on the equipment you will be purchasing for maintenance purposes.
- Don’t have or don’t develop their own products that can provide extra value added services to your business. A provider that participates in the IT development race gives you an indication of how healthy their level of expertise is and it should make you more confident about their support level that you will be getting from them.
Of course you will run into scenarios where the provider might have the NOC but many not be developing their own solutions or any other scenario. The above is just a guide to show you the important angels of the satellite internet project that need to be covered before you make a decision.
- If you are looking to establish a network between your office and your vessel and treat the vessel as an “extension” of your office, then you will probably need to setup a VPN to serve that purpose. VSAT, in this scenario, is your right choice for sure.
- If you are looking for streaming, video conferencing, bandwidth management and crew services all under one technology, then you should go with VSAT as well.
- If you are looking for just e-mail service with minimal browsing, then L-Band services might be suitable for you.
- The region where the vessels trade is also important when it comes to making a decision. How does the satellite coverage work for you? You should always ask for the coverage footprint in order to know where you are at and how well you are covered during your operation.
- Try to homogenize your fleet. When you have the same internet setup across your vessels, then training the officers and the IT personnel on board to troubleshoot the connectivity problems will be easier. The network setup will be more efficient. By having your provider involved in your network setup, the officers on board will have an “on the spot” training on how to operate on the network and help them troubleshoot it. By having the first layer of support on the vessels (i.e. vessel’s officers and the IT department), then you will minimize the downtime and the cost of getting any issue rectified.
- Educate yourself about satellite connectivity, how it’s priced and how it works. Satellite connectivity is not that cheap in its nature. It’s good to understand all that to help manage your investment better. Consult an expert to save many potential costs. It is always advised to work with an expert or a consultant to be used as a resource when you need it. A satellite communication specialist can help direct you to the right path. However, you should always keep the above in mind when discussing your needs for your satellite internet connectivity.
As you can see, satellite connectivity is not as simple as getting internet on board a vessel. It is all about what it will do for you more than what you will pay for it. Technology advances in a much faster rate than what it used to be. So the high costs will eventually come down and new technologies will come out. The point is to choose what will help maximize your business and support its growth. That’s how you should be looking at VSAT, not the price.