Al Yah Satellite Communications, better known as Yahsat, bought a minority stake in eSat Global, an Internet of Things connectivity solutions provider, as it seeks to expand operations in the fast-growing IoT sector.
The move will bring a “new disruptive, low-cost, low latency, direct-to-satellite IoT service to the market”, Yahsat said in a statement on Tuesday to the Abu Dhabi Securities Exchange, where its shares are traded.
The acquisition of eSat will enable Yahsat to expand in the “fast-growing” IoT sector, that is still “significantly underpenetrated” and is in line with the company's strategy of prioritising growth sectors, it said.
Details about the investment and the size of the stake were not disclosed.
Yahsat’s mobility business Thuraya also signed a commercial agreement with eSat to develop a next-generation IoT platform that will provide customers with IoT portfolio access on a global scale.
It will provide Thuraya with “secure and long-term access to an end-to-end, low power wide area network (LPWAN) IoT system and portfolio”, Yahsat said.
The companies are planning to launch the IoT system and portfolio, and commence commercial activities by the fourth quarter of 2023.
“Yahsat’s investment in eSat, combined with Thuraya’s commercial agreement, is aligned with our belief in the outsized impact of the IoT sector for the satellite and space industry today, and in the years to come,” said Yahsat Group chief executive Ali Al Hashemi.
“Through this partnership, we will be able to serve our customers even more effectively by offering smart, reliable and customisable solutions that will unlock new and exciting opportunities across a range of sectors.”
The overall IoT market is projected to grow at a compound annual rate of 22 per cent over the next five years to $525 billion and the satellite IoT business is forecast to generate a cumulative revenue of $6bn over the same period, according to Yahsat.
The satellite operator, founded in 2007, currently offers multi-mission satellite services in more than 150 countries across Europe, the Middle East, Africa, South America, Asia and Australasia.
It has a fleet of five satellites that extend its reach to more than 80 per cent of the world’s population.
The company expects its IoT business to be a key driver of its commercial mobility business, chief commercial officer Sulaiman Al Ali told The National in August.
The partnership with eSat will enable Thuraya’s service partners to address critical IoT requirements in key segments, including smart agriculture, environmental monitoring, digital maritime and cold-chain tracking, Yahsat said.
The new platform will enable “millions of devices to be serviced simultaneously and efficiently in a cost-effective way”, it said.
Devices equipped with the new eSat communication module will be able to communicate with satellites using very low transmit power anywhere within Thuraya’s footprint.
The new platform has been designed with 5G considerations, has ubiquitous coverage and will also integrate capabilities to support low-cost texting services to enable constant connectivity for smartphone users, particularly in emergency situations.
“We look forward to building on our partnership with Yahsat to deliver LPWAN connectivity to Yahsat’s existing customers and many more new users for whom satellite-enabled connectivity has not previously been an option,” said Rick Somerton, chief executive and president of eSat Global.