Iridium Communications Inc. (NASDAQ:IRDM) Q2 2020 Earnings Conference Call - Final Transcript

Jul 28, 2020 • 08:30 am ET

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Iridium Communications Inc. (NASDAQ:IRDM) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] And our first question today comes from Ric Prentiss from Raymond James. Please go ahead with your question.

Analyst
Ric Prentiss

Thanks. Good morning guys. Glad to hear everybody's doing okay in these crazy times.

Executive
Matthew J. Desch

Hey, Ric.

Analyst
Ric Prentiss

Hey, a couple of questions; one, let's start at the 30,000 foot view or 2,000 kilometer view. Matt, we get a lot of questions about the new LEOs, right? The SpaceX in the marketplace raising some money; OneWeb maybe coming out of bankruptcy with the British government and Bharti and others supporting it. As you think about your business and these new LEOs, what do they mean competitively to the new areas of your business, the Certus broadband, but also the legacy areas of your business voice and data, IoT and even the government?

Executive
Matthew J. Desch

Yes, Ric. I mean, I really don't think they are direct competitors in any way. Perhaps, around the edge, long, long term. But really for the most part, we see all those new LEO players as potential partners and we're offering commodity broadband services that are complementary to the much more mobile safety oriented services that we provide. So, we've had discussions with all of them. They all see it the same way. They see us as someone that could possibly be integrated into their services to supply a better service to their customers.

I think, I've talked about this before, the way our whole services are architected or structured is very, very different from theirs. Their whole vision of all of those players is to try to provide the most bandwidth to a specific customer as possible to every customer as possible. Our whole system is architected and structured to provide the most mobility. We provide as much data as possible in the smallest possible package and those are two totally different sort of design philosophies. And really, they're not -- you can't really change one to the other and back and forth. So they really can't scale down to the levels we're at, they could never offer, say, a small device that operates in the palm of your hand and integrated into a mobile phone or onto a very -- a consumer device and frankly our system doesn't scale up to offer 50 megabits per second, which is what they all are looking to try to offer almost as a minimum.

So, the two services worked very well. It's demonstrated today in the fixed satellite service players, who our terminals are put right next to theirs on ships as a companion VSAT offering and really those small new -- I mean, those new LEO players really are more focused on competing for that commodity broadband segment, which has been around for 20 years, and for which we've been very complementary to all along. Than in any way to doing something that we have been doing or plan to do in the future.

Analyst
Ric Prentiss

And any thoughts of what it might