China’s rapidly growing aviation industry presents a huge opportunity for in-flight connectivity providers and satellite companies alike, but its complex regulatory environment and restrictions on Internet access make it a challenging market to enter. Stakeholders agree that the best way to compete for business in China is through local partnerships, but even this approach does not mean an easy ride.
“China is a massive market and it’s growing at a spectacular rate,” says Inmarsat Aviation Asia-Pacific regional director Bill Peltola, who notes that the satellite company has had “a significant presence in China, going back to the late 1970s”.
Inmarsat’s SwiftBroadband (SBB) service, provided by the company’s Chinese partner MCN, was used on the first Chinese airline flight to be equipped with passenger wi-fi – an Air China Airbus A330 operating from Beijing to Chengdu in 2014. Inmarsat has since agreed to form a joint venture with MCN to provide aircraft cabin and cockpit connectivity solutions in the country. MCN built the ground station for SBB and is a value-added reseller for Inmarsat’s new Global Xpress (GX) Ka-band solution.
“There is lots of potential and we’re in lots of joint discussions with airlines, including Air China,” says Peltola. The Chinese flag carrier “is doing a GX trial next year”, he adds. Nevertheless, the regulatory environment remains “challenging” in China, and companies need to operate flexibly in order to work around the “complex situation” caused by restricted Internet access in the country and its airspace – widely known as "the great firewall of China".
“There are requirements for screening and barring of certain websites, but our infrastructure and having a station in China gives us the capability to do that quite easily on a per-aircraft basis,” says Peltola.
Panasonic Avionics in July extended a Ku-band in-flight connectivity trial with its Chinese partner, China Telecom Satellite (CTS), by one year. Under the agreement, Panasonic says that over 20 foreign airlines with more than 1,000 aircraft are expected to begin operating connected flights over Chinese airspace. In addition, it adds, Panasonic’s Chinese airline customers – which include China Eastern Airlines, China Southern Airlines, Hainan Airlines and Xiamen Air – are preparing to offer connectivity services across their global networks.
“Under the Chinese regulatory structure you need to have a licensed telecom partner, and there are only three,” says David Bruner, vice-president of Panasonic’s Global Communications Services division. The agreement with CTS is a “reciprocal relationship”, whereby the Chinese partner is the license holder.
“We recently renewed the trial for another year so the regulator can couch the nuances for how they want the service to be delivered for China-registered aircraft,” says Bruner.
In-flight Internet access is governed by the country in which an aircraft is registered, therefore foreign airlines are not bound by the same rules as Chinese carriers when operating in its national airspace.
“This makes it an interesting network challenge, but we were able to present a solution… that allowed us to go forward and keep everybody happy,” says Bruner. It is a “full-time effort for us to keep track of the regulations”, he adds.
Source: Flight International
