getting your maritime connectivity strategy right – challenges and best practices

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DECIPHERING BROADBAND AT SEA Getting Your Maritime Connectivity Strategy Right — Challenges and Best Practices NO. 4 IN THE SERIES

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Page 1: Getting Your Maritime Connectivity Strategy Right – Challenges and Best Practices

D E C I P H E R I N GB R O A D B A N D AT S E A

Getting Your Maritime Connectivity Strategy Right — Challenges and Best Practices

NO. 4 IN THE SERIES

Page 2: Getting Your Maritime Connectivity Strategy Right – Challenges and Best Practices
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Getting Your Maritime Connectivity Strategy Right — Challenges and Best Practices

Table of Contents Intro……………………….………………………………………………….……...………..1 The Changing Environment ………………………………………………….……...………..2 Where Does the Responsibility Lie?……………………...………………………...…………3 Creating a Strategy to Suit Specific Needs …………………………………………….………4 Benefits and Applications of an Effective SATCOM Strategy…………………………...……4 Operations and Regulations ……….………………………………………...…………………4 Manning and Recruiting………………………………………………...………………………5 Crew Welfare…………………………………………………………………........……………5 Considerations for a Successful SATCOM Strategy………………………………..…………6 Speed vs. Need……………………………………………………………………….…………6 A New Model……………………………………………………………………...........………7 Transparency, Control, and Network Management………………………….......………………8 Multicasting ……………………………………………………………………............………8 Future-proofing Your Solution ..…………………………...……………………...…...........10 Questions to Ask and Things to Consider in Developing an Effective Maritime Communications Strategy....………………………………………………….………..……10 Summary.…………………………………………………………………….………………11

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A multitude of conflicting messages and competing technologies crowd the airwaves as maritime industry managers seek to establish a viable shipboard communications strategy.

SATCOM-savvy sales teams jostle for the attention of these managers, all boasting that they can provide nearly complete or total coverage in terms of geography, operational services, and communications and entertainment for crew members.

The trouble, says Adonis Violaris, chairman of the Information and Communications Technology sub-committee of the Cyprus Shipping Chamber and an expert who has studied the market and the offerings in depth, is that there are too many providers.

In addition, the costs of satisfying and balancing the many connectivity demands of the ship, its operators and its crew, are often far from clear and pack a hidden punch. This “solutions” dilemma comes at a time when the fundamental concept of ship operation is being reinvented, an evolution with the online revolution and digital connections at its core.

In a sign of how difficult it is to get the “connected ship” strategy right, many owners and managers shy away from discussing the matter and from making the tough decisions. The complexity and diversity among SATCOM offerings, together with the growing number of stakeholders relying on these services, makes it challenging to develop any sort of cohesive strategy. This is at a time when InterManager, the trade association for ship managers, and other bodies, are drawing up guidelines and blueprints for the

“paperless ship.”

Such needs include those of the master and officers requiring easy, uninterrupted contact with colleagues, harbor officials, administrators and regulators on shore, and to carry out competitively critical tasks such as least cost routing. Then there are the seafarers who have come to expect daily connectivity with family and friends ashore (access to the Internet has been classed as a human right by the United Nations) and the availability of social media, movies, news, and sports programs they consider part of civilized life.

As a result, any effective maritime SATCOM strategy must serve several masters:

• Efficiency and profitability of operations,

• Operational and regulatory compliance,

• Effective manning and retention,

• Safety at sea, and

• The needs of an increasingly “digital native” crew.

Getting Your Maritime Connectivity Strategy Right — Challenges and Best Practices

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Right off the bat, maritime managers must take into account the cost of any solution. Unlike the modest outlays needed for personal devices such as smartphones, laptops, tablets, and personal computers ashore, purchasing or leasing and then installing equipment on ships is a major investment, to the tune of $10,000 to $80,000 per terminal based on size, capabilities and service. This is all before any monthly service bills.

Once the system is installed and at sea, for the sake of those on the bridge and elsewhere on the ship, as well as everyone and everything in the ship’s environment, it is vital that the set-up works reliably without unexpected hardware, service, or network limitations or restrictions, while it supports the needs of diverse stakeholders onboard and ashore.

As in all industries, it is difficult to strike the right balance.

The Changing Environment

Until some years ago, vessels sailing more than five miles offshore had just one option for Internet access – Inmarsat.

Now, the granddaddy of maritime satellite communications finds itself competing hotly with other suppliers, and with other technologies. The most notable and fastest-growing SATCOM technology at sea is compact, Ku-band VSAT (Very Small Aperture Terminal), which is a small earth station that uses a stabilized antenna to receive and transmit real-time data via satellite at broadband speeds and typically at a far lower per MB cost than that available through Inmarsat.

However, it’s critical for maritime leaders to recognize that seemingly economical packages on the market can hide unexpected costs and deficiencies. It is clearly an issue that has received insufficient attention in maritime circles despite the huge implications, at a time when the industry as a whole is evolving and freight income continues to be precarious. In an era of fast-moving market conditions, each ship operator has to define a realistic strategy for its requirements of connectivity and content delivery by managing both supply and demand.

Mr. Violaris of the Cyprus Shipping Chamber says: “Shipping is still years behind the rest of the world with regards to technology, whether this be communications or software, and this gap cannot be easily bridged, but the demand for transferring high amounts of data to and from the vessels is growing day by day.”

What is increasingly acknowledged today is that the ship is a cog in the international trade machine. Cogs have to be visible and, above all, connected. The 2014 Technology Outlook survey from INTTRA, which bills itself as ocean shipping’s leading e-marketplace, indicated that the top technology priority of shipping professionals is “improving supply chain visibility capabilities to integrate higher quality data,” illustrating the importance they attach to easy access to timely, accurate, and complete shipping information.

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Most other businesses in the supply chain boast abundant communications bandwidth, and expect ocean shipping to be accordingly responsive, which is now practical, admittedly at a higher cost than that paid by their shore-based brethren.

New broadband services are coming on line that can help shipping companies reduce costs and command higher margins for their service by adding value for their customers – yet the maritime industry remains far from a happy ship in this area.

Where Does the Responsibility Lie?

Who is to blame for the current ragged state of affairs?

While satellite service companies may be frustrated over what they see as the shipping industry’s aversion to new technology, shipping company IT and communications (ITC) managers turn the equation round: their aversion is to the historically high cost of satellite communications service.

For example, in the eyes of some industry observers, Inmarsat’s domination of the market may have led it to become over-confident of retaining its share. Mr. Violaris said: “The Inmarsat price increase for narrowband terminals over the last two years made it almost unbearable for the ship operators to retain this technology, making the switch to a broadband terminal the only option.”

Maritime Industry Australia chief executive Teresa Lloyd is scathing in her opinion of IT suppliers, whom she has described ironically as “the worst communicators on the planet.” Ms. Lloyd told a Futurenautics Roundtable on Shipping: “You can easily end up in this spiral trying to chase your tail to find out if what you are going to get is what is going to solve your problem. It is a huge business overhead.”1

Later she spoke of her despair in trying to get IT providers to describe clearly what they are doing and take responsibility for issues that arise. “It’s an area where ‘buck passing’ is all too easy – we hear that it’s the Internet provider’s fault or the hardware is too old or you need a software upgrade...I could go on. If I ran our organization like that we’d be out of business.” Evaluating, selecting, negotiating with, and managing multiple parties for a complete satellite communications solution is one more complication that maritime managers simply don’t need. Recognizing that, companies like KVH Industries are making the move to offering a true end-to-end solution that eliminates the “buck passing” and support runaround. For KVH, it’s encapsulated by its Power of One™ approach, which provides fleets with a single-partner solution that covers:

• Rugged KVH-designed and manufactured hardware,

• A seamless global network and reliable connectivity,

• Licensed content and efficient content delivery, and

• A comprehensive and flexible set of global support services.

1 Futurenautics, “Shipping 3.0”

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Creating a Strategy to Suit Specific Needs

Despite or because of the rapid development of technology, experience has shown that a “one size fits all” approach of a speed-based, fixed price satellite service is less rational than it sounds. Each shipping company needs to get its hands on a system that will suit its specific needs and was selected through a careful and consultative evaluation.

In part, it is less a question of speed than of acquiring the most efficient suite of functions that meet clearly defined (and in some cases, critical) needs. Attempting to slash costs without regard to all the consequences – a path often taken by highly leveraged shipowners struggling to survive – can only lead to a downward spiral of poorly maintained vessels and poorly motivated crew members.

On the question of speed of transmission, Ms. Lloyd of Maritime Industry Australia comments that while this is important, “what data we are transmitting is also important. We collect a lot of data (which consumes bandwidth and costs many, many dollars) but we don’t always know why we collect it and often we do nothing with it. So understanding our data needs should be the first step – but often it is an afterthought at best.”

The Internet is usually a byword for efficiency, but the high cost of transmitting data to ships at sea via satellite quickly disrupts the economics. Speeding up Internet services often makes network congestion worse, as users take advantage of the increased data rates to consume even more content.

What look to be simple solutions can turn out to be annoyingly complicated. Hard-pressed ITC managers face the daunting prospect of working out the exact needs of everyone on a vessel for connectivity, content, and connected applications, which calls for an in-depth strategy way beyond simply connecting up the Internet onboard the ship. That means working with the service providers to set up ‘end-to-end’ solutions for a fleet.

Benefits and Applications of an Effective SATCOM Strategy

Successfully deploying such an end-to-end solution, based on an effective, well-planned strategy, offers a range of benefits to shoreside and shipboard operations, safety, and competitive positioning.

Operations & RegulationsOn the bridge, the officers need to harness their electronic resources to ensure the ship complies with constantly evolving regulations on such key matters as emissions reduction (involving the switch to more expensive fuels in designated coastal regions, and back again for the open seas) and Safety of Life at Sea (SOLAS) requirements relating to electronic charts, maritime security alerts, and other vital matters.

In addition, there is what has until now been a stack of paperwork to comply with the Standards of Training, Certification and Watchkeeping (STCW) convention on the testing, education planning, and detailed reporting of each seafarer’s individual training and competency records.

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Shifting to an e-training approach that takes advantage of digital content delivered by satellite and incorporating a training management system enables seafarers and administrators to stay up to date, comply with requirements to record and report training status, and access necessary records across the entire fleet.

Martin Kits van Heyningen, president and CEO of KVH Industries, Inc., commented during a forum at Nor-Shipping 2015 on the growth of available data and the competitive advantages it could provide maritime operators: “The maritime industry has spent the past 20 years trying to limit the amount of data going on and off vessels, while the rest of the world has been doing the opposite in adopting big data.” He later added that the availability of such data – the accumulation and processing of vast quantities of digital information – will yield voyage and financial optimization previously unavailable to the maritime industry.

Manning and RecruitingSatellite communications can also play a vital role in addressing a 21st century headache for many sectors of the maritime industry: how to attract and retain a new generation of seafarers. These are the men and women who are considered “digital natives,” who might spend weeks at sea at a stretch, and who, because of generally improved quayside turnaround times, or new port regulations that prohibit shore leave, will have little free time to ‘connect’ from shore.

Many of these relatively young men and women are highly educated and accustomed to constant contact with their families and friends through social media, apps, and the wide range of content available online. This plugged-in generation will quickly turn their backs on a career in the merchant marine unless their e-needs are served.

Crew WelfareThe Maritime Labour Convention has set new standards for the conditions under which seafarers live onboard, and includes calls for seafarers to have access to news and entertainment and affordable communications services.

Keeping crew morale high is a challenge. Use of the Internet by everyone, ashore and at sea, has increased significantly in the last 15 years, and the more popular social media outlets receive an enormous amount of traffic. However, estimates from late 2014 (and the picture has probably improved only slightly since then) indicated that 68% of ratings and 28% of officers lack access to email while at sea. The same survey found that 3% of ratings and only 14% of officers were allowed to use the Internet onboard for social media, email and web surfing. This is a big contrast to what they are used to when at home, where 4 out of every 10 ratings, and 8 out of 10 officers were said to have regular access to the Internet.2

This gross disparity of modern life onboard compared with the luxury of shore-based work is untenable. What is a progressive shipping company faced with substantial costs for providing 2 Bernhard Schulte Shipmanagement, Digital Ship Athens, November 2014

0.4 GB/person50 GB/person

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high levels of Internet access to do? To allow their employees to travel freely along what used to be called “the information super-highway” would saddle the ship managers with potentially onerous monthly expenses. However, not providing such support puts crewing and manning requirements at risk.3

Considerations for a Successful SATCOM Strategy

The high costs of Inmarsat services stemmed from the expense of setting up the first system for the United Nations. Inmarsat was later sold to private ownership in 1999, leading to the launch of its fully digital FleetBroadband service. Shipowners were caught between a rock and a hard place: they were keen to tune in to the Internet age, but the installation of connectivity using this service was the gateway mainly to…potentially massive bills.

Inmarsat has addressed the criticisms and retains business through a mixture of quality, loyalty, incentives for major users, and sometimes customer inertia.

Despite this, Inmarsat FleetBroadband has issued four price increases in as many years to try to get customers to switch to more efficient services. Despite cushioning transition costs, offering a beneficial tariff to high users, and reducing the per MB price at the cost of dramatically higher monthly package sizes and overage rates.

Stuck in the middle, ITC managers yearn for a customized service but are constrained to keep down costs. As a result, it then appears that they are thwarting the digital revolution that is sweeping through every other industry, but often they are doing their best to ensure that their company would not be hit by “bill shock,” the huge monthly airtime bills that can result from runaway data use and something that could quite likely cost them their jobs.

This quandary prompted many ITC managers to tamp down on consumption by blocking websites and file types, putting in place transmission protocols, limiting access, and installing file optimization software to reduce the amount of data transmitted. This approach protects the network but at the expense of versatility and flexibility, essentially walling off sections of the Internet from the officers and crew.

Speed vs. NeedThose in the shipping industry who wanted an alternative to Inmarsat with its owned satellite network and controlled hardware looked to the developing VSAT technology for the answer.

While Inmarsat service is generally charged on the basis of buckets of data with overage charges, VSAT providers have historically charged a flat monthly fee, which sometimes includes the hardware, for what is said to be unlimited access to the Internet with variations in price driven by the selected connection speeds.

Since 2015, KVH has made efforts to expose what it says is “the truth about ‘unlimited’ VSAT plans.” The company says that such plans are in reality capacity-constrained and designed to limit a ship’s network access in an effort to protect the network itself.

Capacity is not speed – it is bandwidth used over time and has to be carefully managed. The promised speed refers to the total bandwidth delivered to the vessel and is divided among the number of users trying to access the network. This, it is said, means that individual vessels or users do not experience anything close to expected speeds. The catch is that the amount of

3 Read the third article in the Deciphering Broadband series, “Connectivity – A Critical Element in Seafarer Recruitment and Retention,” for additional insights into these needs and the value of a connected crew.

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capacity that can be used over the course of a month, even on a relatively slow connection, can be very large if the system is in constant use. In addition, the speed for “unlimited plans” is also being divided among all users, resulting in individual performance that can be dramatically lower than the performance users might expect.

This is especially so in regard to streaming of rich formats such as video and audio conferencing, Skype, social media and other applications, which gobble up bandwidth and are likely to be blocked or curtailed. Glued to the screen, crew members used to wide open connections onshore fail to recognize that they are bringing down the network because “fair use” thresholds in the contract with the service provider will trigger the brakes.

These very activities are of course the most popular services for younger seafarers. They complain, and the next thing is that the ITC manager escalates the issue to the service provider, which insists it is keeping to the service contract.

The fair use policies are often contained in “fine print” clauses and state that service will be delivered at the promised rate until certain thresholds are reached, at which point the service may be slowed deliberately to limit consumption. Deadlock. A clampdown on usage by the crew saps morale, and all, except perhaps the vendor, live unhappily ever after. The ITC manager, who had initially won kudos for securing the cheapest, fixed price deal, now has to answer for supposedly letting his employer down by failing to ensure a high quality service.

The shipowner or manager must be careful in weighing the promise versus the performance of a “fixed rate” service solution. It might be hard to secure redress for the overall poor quality if service is acceptable for even just 1 hour in 24. In any case, just how does one measure performance?

The goal has to be that of attaining quality of connectivity independent of the size of the monthly airtime contract and with transparent pricing. It has to be accepted that there will be a need to download large files including chart databases and manuals for operational and training reasons; and commercially licensed content, including TV shows, news, sporting events, movies, and music.

A New ModelStarting in October 2015, KVH Industries offered an entirely new approach to maritime SATCOM data plans. The new “Open” and “Metered” Plans discarded the traditional

“unlimited” approach with pricing based on the speed selected and the throttling that could occur if a vessel exceeded the fair use policy limits in favor of usage-based plans that are designed around each ship’s monthly requirements for operational and crew data. Highlights of this approach include:

• Data delivered at the maximum speeds on the network (up to 4 Mbps) at every price point and regardless of which package a ship manager has selected

• No protocol or application restrictions

• New tools for data management and control

Critical to the success of this new model for SATCOM service is the addition of an unprecedented level of control as well as complete transparency with regard to data usage, all designed to ensure that shipowners, managers, and officers can eliminate the risk of monthly

“bill shock” and runaway data use.

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Transparency, Control, and Network ManagementWith that in mind, any maritime SATCOM strategy and communications provider must take into account shipowner and operator concerns about exploding data use by providing control and alert mechanisms.

Network and data management, such as that offered by KVH’s myKVH™ secure portal, is therefore a critical tool that must be provided. These versatile systems can manage data use through per day, per week, or per month allocation for categories of users such as a master, officers and ratings, or even on an individual basis, which should restrain the “binge” user.

It is better to be straight with seafarers in the first place about limits, but alongside this to offer them the ability to buy additional personal connectivity. Mr. Violaris contends “Crew members are willing to pay a reasonable price for Internet access. And this will for sure please owners as it lowers operating cost of the new services implemented.”

Nevertheless, someone is going to have to manage data use. Mr. Violaris says, “Traffic needs to be controlled based on the originating network, the application that is running, and the end user. By controlling traffic we are able to guarantee quality of service.”

There is a growing need to look beyond simple metrics focusing on the speed of an Internet connection. Instead, commercial maritime operators need to look at the suite of support services that allow enlightened ITC managers to develop a complete, managed solution to meet all of their operational needs.

Reducing bandwidth requirements – via web caching and web image compression – is, for instance, a top selling point of KVH’s network management application, the CommBox™ Ship/Shore Network Manager.

MulticastingAnother way of taking the strain off connectivity is multicasting, which can provide both operational content and personal (or more properly said, community) content to crew.

Multicasting came from the realization that groups of customers want identical or similar large files, such as movies, TV shows, music, and daily news and sports. That content can be affordably delivered in a single broadcast to multiple vessels simultaneously as opposed to being individually sent to each vessel or to multiple people on the same vessel. Content is then cached on board for easy access by smartphone, tablet, laptop, or TV at any time and without using the vessel’s monthly data plan.

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The result can be a source of valuable operations data as well as an entertainment service to meet crew members’ demands for news from their home country, coverage of sporting events, movies, TV shows and music channels licensed for commercial use on ships. Just as importantly from the shipowner’s regulatory and legal perspective, this content can be delivered in full compliance with copyright laws and requirements for commercially licensed content, thereby reducing the risk to shipowners and operators.

Added to the growing and demanding upcoming legislation, which translates into added costs for shipowners, it has just come to our attention that another problem, arising out of online media is evolving. Seems that crews on board ships are able to access the Internet and thereby able to download movies, illegally, using file share sites. A crew member of a ship at sea, downloaded a movie, illegally, and somehow the movie production company found out and took action – threatening to sue both the Internet provider and the shipowner. In turn, the Internet provider, sent a strong message to the shipowner, basically stating that they are aware of the ship’s Internet account having been used to download illegal movies, quoting the ship’s IP address, name of the movie, date, and time. They further threatened to limit or suspend the ship owner’s Internet services on all the vessels.4

In 2014, KVH launched IP-MobileCast,TM the first maritime multicasting content delivery service. Every month, IP-MobileCast sends 500 gigabytes of electronic charts, weather forecasts, daily news, sporting events, movies, music, and training courses to subscribing vessels, all without impacting the quality of the vessel’s normal mini-VSAT BroadbandSM service or its airtime bill. Due to the large data files involved, much of this data and services could previously only be delivered physically in the form of CDs and DVDs when a ship called into port.

The multicast facility is also about more than enabling well deserved rest and recreation. Services like weather data can be delivered via multicast, which enables better route planning, route optimization to save fuel, more precise scheduling of port arrival, avoidance of parametric roll, analysis of ship performance, and other benefits. While meteorological parameters are calculated at shore stations and transmitted to seagoing ships, officers who know the specifics of their ship and its voyage plan can run calculations themselves, putting their input into the mix.

Robert Hopkins, director of IP-MobileCast services at KVH, emphasizes the importance of delivering content to vessels in a way that takes the pressure off the megabyte-based monthly airtime plans.

“We think that using a standard data connection for operations and entertainment purposes is very expensive, wasteful, and not very satisfactory to the end-user over a satellite link. So our strategy has been to deliver the content in another way, by ‘multicasting’ that content once to all subscribing vessels and stored onboard.

“”

4 Shipping HK Forum, “Online Piracy on the High Seas? Owners to Pay for Social Media Burden?”

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“This allows latency-free access to the content for all users on the vessel, without consuming precious satellite bandwidth. Instead of 100 users sending and receiving individual requests to view a sports highlight, news story or video clip, the content is delivered to the vessel’s network once, to be viewed by every user at his or her leisure.”

Future-proofing Your Solution

Some owners and managers might be wary of signing a communications contract because, given the rapid advance of technology, what they are buying might be out of date within months or weeks.

There are certainly fascinating developments under way in the field of Mobile Satellite Services (MSS), which use very small terminals to provide two-way voice and data communications with per-minute or per-megabyte service fees. These and other providers aim to compete toe-to-toe with VSAT, while the VSAT providers are themselves far from standing still and are regularly increasing coverage. High-throughput satellites (HTS) will be the next step in the advancement of maritime VSAT services.

The owner or manager who invests in a future-proof communications solution after prudently thinking through and stress testing, as best they are able, all the options, will be able to live with it for many years without being too rudely disrupted by something radically different that bursts upon the market.

Questions to Ask and Things to Consider in Developing an Effective Maritime Communications Strategy

1. Survey the needs of your stakeholders – operations, IT, fleet managers, officers, crews, engineers, security and safety teams, and more – so that you understand the absolute “must haves” when it comes to broadband needs as well as the wish list. Understanding these parameters will enable you to gauge your true SATCOM requirements and deliver the functions and capacity necessary for success.

2. Ensure that your prospective service providers offer an end-to-end solution that takes into account hardware, airtime plans, network management, service and support, and content. Doing so will stop the “buck passing” and provide you with full transparency with regard to your data speeds, data usage, costs, and more while providing that single point of contact for all of your maritime SATCOM needs.

3. Make certain that your SATCOM solution offers secure, flexible, and fully transparent data and network management tools, including, at a minimum, data usage alerts that can be sent via SMS text or email to anyone designated, comprehensive data allocation capabilities to manage data use down to the individual onboard, system and service performance reports, and more.

4. Consider the advantages of multicast delivery of content to reduce the load on and data usage by your monthly service plan and to deliver a wide range of operations and entertainment content for use by officers and crew.

5. Protect your investment and ensure that your selected solution is capable of not only supporting your needs now but also in the future as new satellites, service options, and capabilities are rolled out.

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Summary

“It is obvious that the future will be VSAT for the majority of the vessels, but it is up to the needs of each shipowner to decide which system to go for,” advises Mr. Violaris.

Making the decision that supports your fleet requires the time and effort to assess your critical needs, your expectations for growth, and what factors will offer the greatest competitive advantage in an increasingly competitive industry. Taking these into account will help you overcome the challenges and get your “connected” strategy right.

About the Series“Deciphering Broadband at Sea” is published by KVH as an aid to smarter decision-making around global satellite communications. With its “Power of One” communications solution, KVH is dedicated to making life at sea more profitable for the shipowner-manager, more efficient for the ship operator, and better for the seafarer. If you have suggestions for topics for future installments in the series or questions on any article, please send them to [email protected].

www.kvh.com

To subscribe to the “Deciphering Broadband at Sea” series, or to view the other articles in the series, visit: www.kvh.com/decipher4

©2016, KVH Industries, Inc. DecipherBAS4 3.16 KVH, CommBox, IP-MobileCast, myKVH, and Power of One are trademarks of KVH Industries, Inc.

All other trademarks property of their respective companies. mini-VSAT Broadband is a service mark of KVH Industries, Inc.