EC Opens Investigation of Viasat - Inmarsat Deal

The European Commission has opened an in-depth investigation to assess the proposed acquisition of Inmarsat by Viasat. EC is concerned that the transaction may allow Viasat to reduce competition in the market for the supply of broadband in-flight connectivity (‘IFC') services to commercial airlines.

Viasat owns and operates four geostationary earth orbit (‘GEO') satellites and Inmarsat owns and operates fifteen. Both companies are close competitors and rely on capacity from their GEO satellites to provide services in the nascent market for the supply of broadband IFC services to commercial airlines in the European Economic Area and globally.

There are currently few alternative suppliers, and the markets are characterized by relatively high barriers to entry, such as regulatory and technological. The satellite market is undergoing a transition with operators of non-geostationary satellites having entered or planning to enter the IFC market. EC plans to further investigate whether those new players are likely to exert sufficient competitive pressure on the merged entity in the near future.

At this stage, the EC is concerned that by acquiring Inmarsat, Viasat may reduce competition in the supply of broadband IFC services to commercial airlines in the EEA and/or globally. The proposed transaction was arranged on 9 January 2023. The EC now has 90 working days, until 29 June 2023, to take a decision. The opening of an in-depth inquiry does not prejudge the outcome of the investigation.