Profile: Iridium Communications Inc (IRDM.OQ)

IRDM.OQ on NASDAQ Stock Exchange Global Select Market

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Iridium Communications Inc., incorporated on November 2, 2007, is a provider of mobile voice and data communications services via satellite. The Company provides voice and data communications services to businesses, the United Sates and foreign governments, non-governmental organizations and consumers via its constellation of 66 in-orbit satellites, in-orbit spares and related ground infrastructure. The Company sells its products and services to customers through a wholesale distribution network of approximately 70 service providers, 175 value-added resellers (VARs) and 50 value-added manufacturers (VAMs). As of December 31, 2012, it had approximately 611,000 billable subscribers worldwide.

The Company’s commercial end-user base includes markets, such as emergency services, maritime, government, utilities, oil and gas, mining, recreation, forestry, construction and transportation. Ship crews and passengers use its services for ship-to-shore calling, as well as to send and receive e-mail and data files, and to receive electronic media, weather reports, emergency bulletins and electronic charts. Shipping operators use its services to manage operations on board ships and to transmit data, such as course, speed and fuel stock. Aviation-based end-users use the Company’s services for air-to-ground telephony and data communications for position reporting, emergency tracking, weather information, electronic flight bag updates and fleet information.

The Company’s services are mobile satellite services, including mobile voice and data services, machine-to-machine (M2M) services and data. Sales of it commercial services collectively accounted for approximately 55% of its total revenue, during the year ended December 31, 2012. The Company also sells related voice and data equipment to its customers, which accounted for approximately 25% of its total revenue, in 2012. In addition, it offers services to the United Sates government customers, including the United Sates Department of Defense (DoD). The United Sates government services accounted for approximately 20% of its total revenue, during 2012.Its commercial services include postpaid mobile voice and data satellite communications services, prepaid mobile voice satellite communications services, broadband data services, machine-to-machine services and other services.

The Company sells its mobile voice and data services to service providers and VARs who in turn offer such services to end-users, either directly or indirectly through dealers, using various packaged solutions, such as monthly plans with differing price levels that vary depending upon expected usage. Iridium AxcessPoint is a portable wireless fidelity (Wi-Fi) hotspot accessory that connects smartphones or laptops to the Iridium network using an Iridium Extreme or Iridium 9555 satellite handset. The Company also offers mobile voice services to service providers and VARs through prepaid plans. Its distributors offers its prepaid voice services through fixed devices to subscribers in rural villages, at remote industrial, commercial and residential sites and on ships at sea, among other places. Its broadband data maritime service, Iridium OpenPort, offers maritime end-users speeds of up to 128 kilobytes per second (kbps) and up to three independent voice lines. In conjunction with its distributors, it offers additional services that permit service providers and VARs to offer integrated solutions for ship-to-shore crew calling, e-mail and Internet protocol (IP)-based data communications. In January 2012, KVH Industries, Inc., one of its distribution partners, began offering a product that integrates Iridium OpenPort with its mini-VSATS broadband service to provide backup service.

The Company’s M2M services are designed to address the market need for a solution for sending and receiving data, such as location, from fixed and mobile assets in remote locations to a central monitoring station. This service operates through a two-way short-burst data transmission between its network and a telemetry unit. It sells its M2M services to its distributors who in turn offer such services to end-users, such as various the United Sates and international governmental agencies, including National Oceanographic and Atmospheric Administration (NOAA), as well as commercial and other entities, such as Schlumberger Limited and ConocoPhillips. In addition to access and usage fees, the Company generates revenue from several ancillary services related to its core service offerings, such as inbound connections from the public switched telephone network (PSTN), short message services (SMS), subscriber identity module (SIM), activation, customer reactivation and other peripheral services. The Company also provides research and development services to assist customers in developing new technologies. It charges its distributors fees for these services.

The Company provides the United Sates government customers access to its services, including voice, netted voice, data, messaging and paging services. The Company also provides maintenance services for the DoD gateway through a separate contract managed by Defense Information Systems Agency (DISA), the Gateway Maintenance and Support Services (GMSS), contract. The Company’s principal handset offerings are the Iridium 9555 and Iridium Extreme satellite handset phones. The Iridium 9555 provides voice, SMS and data connectivity.

The Company also offers a combined voice transceiver and data modem, which its distributors integrate into a variety of communications solutions that are deployed in different applications around the world. Its principal offering in this space is the Iridium 9522B L-Band transceiver. Its Iridium Pilot terminal provides up to three independent voice lines and an Ethernet data port configurable for data speeds from 9.6 to 128 kbps over its Iridium OpenPort service. Its M2M device is the Iridium 9602 and 9603 full-duplex short-burst data transceivers. Principal customers for its Iridium 9602 data modems are VARs and VAMs. In May 2012, the Company introduced the Iridium 9603.

The Company competes with Inmarsat plc, Globalstar, Inc., ORBCOMM Inc, Thuraya Telecommunications Co., TerreStar Corporation and DISH Network Corp.

Company Address

Iridium Communications Inc

Suite 1400, 1750 Tysons Boulevar
MC LEAN   VA   22102
P: +1703.2877400
F: +1703.2877450

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