The UK’s Competition and Markets Authority (CMA) said this morning that a merged company “will likely face significant competition from both emerging and established players as the sector expands”.
The CMA specifically looked at the market for providing connectivity to passenger aircraft, and its latest study followed an earlier enquiry that identified competition concerns.
In a joint statement, Inmarsat and Viasat welcomed the publication of the second report. “This is an important milestone in the regulatory process that acknowledges the strong evidence of the highly competitive nature of the global market for satellite communications which includes numerous providers, including well-established companies and well-funded new entrants,” the companies said.
“The combination of the two companies’ complementary technology and assets will create a better business that will offer greater capabilities to UK consumers and government customers alike. It will also play a critical role in creating new jobs and delivering the goals of the UK’s National Space Strategy.”
But the story is not over yet – either within the CMA or among wider regulators.
The CMA said it “will now consult on its findings and listen to any further views before reaching a final decision”. It wants responses within three weeks – by 21 March – and has scheduled its final report, due by 30 March.
And Inmarsat and Viasat said: “We will continue to engage with regulators in Europe and the US on remaining regulatory approvals and will update the market as they progress.”
The European Commission said last month that it has started an in-depth investigation of the proposed merger on in-flight connectivity.
Margrethe Vestager, executive VP of the European Union in charge of competition policy, said in February: “In-flight connectivity is a nascent and growing market in Europe. Viasat and Inmarsat are two leading suppliers of connectivity services during flights and they compete head to head to serve European airlines. With our in-depth investigation, we aim to ensure that the acquisition of Inmarsat by Viasat does not lead to higher prices and lesser quality for in-flight connectivity services on flights in Europe.”
The European Commission will take its decision by 29 June.
In the US, the Federal Communications Commission (FCC) is also investigating the proposed merger, and is considering complaints from SpaceX. Viasat said last year: “We continue to believe that the transaction will serve the public interest and remain confident that the FCC will reach that same conclusion after reviewing the complete record.”
