On April 2, 2024, the European Commission published, in full, its May 2023 decision unconditionally approving the acquisition of Inmarsat by Viasat[1] (the “Transaction”), following an in-depth Phase II investigation.  The UK Competition and Markets Authority (“CMA”) had also unconditionally cleared the acquisition on May 9, 2023.[2]  The Transaction was approved in the context of a trend toward broader consolidation in an increasingly challenged European satellite operations market, with SES announcing its intention to acquire Intelsat just a week before the Commission published its Viasat decision.[3]


Viasat and Inmarsat are both vertically integrated Satellite Network Operators (“SNO”) and Satellite Service Providers (“SSP”).[4] Both offer global two-way satellite-based communication services[5] across a broad array of sectors, including commercial and business aviation, government, energy, and maritime.  They operate four and 15 geostationary earth orbit (“GEO”) satellites respectively, orbiting at altitudes of 35,000 km above Earth, following the Earth’s rotation.  They differ from non-geostationary orbit satellites (“NGSO”) (including Low Earth Orbit (“LEO”) and Mid-Earth Orbit (“MEO”) Satellites) which orbit lower (in some cases at altitudes below 1000 km) and do not remain stationary over one spot on Earth. 

In November 2021, Viasat announced its intention to acquire sole control of Inmarsat.  The Spanish National Competition Authority, whose merger control thresholds were triggered by the Transaction, referred the proposal to the Commission under Article 22(1) of the EEU Merger Regulation.[6]  Twelve other Member States then joined the referral.   

The Commission upon receiving the referral, on February 13, 2023, opened an in-depth investigation[7] to assess whether the Transaction might reduce competition in the offerings of broadband in flight connectivity (“IFC”) services[8] to commercial airlines both at EEA and global level.  The CMA at that point had already referred the acquisition to a Phase 2 investigation on October 14, 2022.[9] 

Relevant markets

The Commission identified three relevant markets for its analysis.

Supply of satellite capacity.[10]  Within a market for the supply of satellite capacity, the Commission considered a range of possible market segmentations, including splits by: (i) broadband and narrowband satellite capacity; (ii) industry segments; (iii) GEO and NGSO/LEO satellite capacity; (iv) HTS[11] and non-HTS (broadband) capacity; and, (v) Ka-band and Ku-band[12] satellite capacity. The Commission ultimately left the market definition for satellite capacity supply open, but acknowledged that a number of market participants had consistently identified differences in product characteristics between GEO and NGSO/LEO satellite capacity, as well as the lack of substitutability between HTS and non-HTS, and between Ka-band and Ku-band capacity for certain applications.

Supply of broadband IFC services to commercial aviation customers.[13]  The Commission had previously defined a commercial two-way satellite communications market that was separate from the commercial one-way satellite communication market.[14]  In the decision at hand, it explored a number of sub-segmentation options for this market[15] and indeed found the existence of a narrower market for the supply of broadband IFC services to commercial aviation customers (separate to business aviation customers), while leaving the ultimate market definition with regard to other potential sub-segments of the commercial two-way satcom space open.  The CMA similarly defined a market for the supply of broadband IFC services to commercial aviation customers, after exploring various market splits.

Supply of IFC services to business aviation customers.[16] The Commission separately considered the market for IFC services to business aviation customers.  It had not previously segmented this market any further, but it did leave open future potential segmentation based on the type of service provided and the aircraft type and size.  The CMA, in contrast, defined a narrower market of IFC services provided to large vs. small business aircraft. 

Competitive assessment

Neither the Commission nor the CMA found that the Transaction would significantly impede competition on any of the relevant overlap markets. 

As a starting point, the combined market shares of the parties were deemed moderate,[17] i.e., around 20% in the supply of satellite capacity, 30-40% in the supply of broadband IFC services to commercial aviation customers, and 20-30% in the supply of IFC services to business aviation customers.[18]  The increment accounted for by Inmarsat was also considered limited, i.e., 0-5% and 0-10% in the satellite capacity and commercial aviation IFC markets respectively.  The Commission concluded that, even though the merged entity’s market power was expected to increase in the near future in the supply of satellite capacity, its market power would not ultimately be significant,[19] given that:

  • Broadband satellite capacity is a homogeneous good, which is interchangeable across various industry segments and creates a platform for close competition;
  • The parties use most of their capacity captively, while leasing only around 20% of their capacity downstream; and,  
  • There is over 40% of spare/unused capacity in the market.

The Commission’s investigation further established that, there are a sufficient number of credible competitors in the markets for the supply of IFC services, including Intelsat, Panasonic, and Anuvu, all of whom have an established and strong presence in the market, and SpaceX, who, while a new market entrant, has already begun exerting material competitive pressure on the parties.[20]  Indeed, the Commission’s market investigation  revealed that SpaceX is already one of the top competitors in the space when it comes to latency and innovation.  It competes closely with Viasat today, and could easily and rapidly expand should the Transaction result in a price increase.  While SpaceX claimed that it does not yet have the required licenses to compete across the board with the parties, it seemed to the Commission to be capable of overcoming those barriers, considering that it had already secured several tenders in the market.

The Commission also considered there to be a nascent and evolving EU market for the supply of IFC services, which has allowed existing competitors and aspiring entrants to find considerable openings.[21]  Specifically, the Commission noted that LEO  investments and further satellite launches by GEO operators were expected,[22] while partnerships for the hybrid supply of IFC services have also been announced in the EU.[23]

While such a Transaction in tendering markets (including the market for commercial IFC services) might theoretically lead to less aggressive bidding between the reduced number of players post-Transaction,[24] the Commission and the CMA both considered that customer contracts in the relevant tendering markets had sufficiently long terms to ensure that they would not be affected by the Transaction and that customers still retained the option of switching to sufficiently credible competitors with “similar (or even stronger, depending on the tender criteria) offerings.”[25]

No commitments required

The Transaction was one of the few examples of cases in recent years where the Commission and CMA unconditionally approved a transaction following a Phase II investigation (only around 17% of the Commission’s Phase II investigations lead to approval without remedies).[26]  Along with other recent transactions cleared in Phase II without remedies (see, e.g., the CMA’s clearance of Arcelik/Whirlpool notwithstanding high shares in certain segments[27]), the Transaction provides continued hope that a Phase II investigation does not need to be the death knell of a deal or a path to certain remedies, but rather that both the Commission and the CMA do keep an open mind and carefully assess the strength of the Parties arguments (including on recent market entry) before drawing any conclusions on the outcome of their review.  It remains to be seen whether these arguments will be enough to ensure a similar outcome for the SES/Intelsat deal which will likely get close scrutiny as well.

[1] Viasat/Inmarsat (Case COMP/M.10807), Commission decision of May 23, 2023 (“the Commission Decision”), available here. See also, Cleary Antitrust Watch, “CMA and European Commission cleared Viasat/Inmarsat transaction after in-depth investigations,” June 13, 2023, available here.

[2] Decision of the UK Competition and Markets Authority on Viasat/Inmarsat merger inquiry, May 9, 2023 (“the CMA decision”), available here.

[3] Intelsat Press Release, “SES to Acquire Intelsat in Compelling Transaction Focused on the Future,” April 30, 2024, available here.

[4] Commission Decision, supra.,fn 1, paras. 18(a) and (b): Satellite Network Operators (SNO) own and manage their own satellite fleets. Satellite Service Providers (SSP) assemble packages of satellite connectivity solutions consisting of satellite capacity and related services and equipment, which they sell to resellers or end-customers.

[5] Commission Decision, supra.,fn 1: Two-way communication satellite networks provide point-to-point connectivity, meaning information can be transferred to and from the same ground stations via the same satellite.

[6] Article 22 serves as a referral mechanism under the EU Merger Regulation, allowing Member States to request that the European Commission examine any merger that, while lacking an EU dimension, impacts inter-state trade and threatens to significantly affect competition within the requesting Member State’s territory.

[7] See Commission Press Release IP/23/768, “Mergers: Commission opens in-depth investigation into the proposed acquisition of Inmarsat by Viasat,” February 13, 2023, available here.

[8] Broadband inflight connectivity (IFC) services are onboard technology using an internet connection.

[9] See CMA Press Release ME/6895/22, “Anticipated Acquisition by Viasat, Inc. of Connect TopCo Limited: Decision to Refer,” October 14, 2022, available here.

[10] Commission Decision, supra., fn 1, paras. 54–81.

[11] High throughput satellites (HTS) provide 10 or more times higher transmission capacity.

[12] Higher frequency bands. Ku-band refers to12-18 GHz and K a-band to 26.5–40 GHz frequencies.

[13] Commission Decision, supra., fn 1, paras. 82–134; and CMA Decision, paras. 7.17–7.20.

[14] Astrium Holding/Vizada Group (Case COMP/M.6393), Commission decision of November 30, 2011; and Apax Partners/Telenor Satellite Services (Case COMP/M.4709), Commission decision of August 20, 2007.

[15] Specifically between (i) broadband and narrowband connectivity, (ii) commercial and business aviation, (iii) short-haul and long-haul flights, (iv) Ku- and Ka-band capacity, (v) GEO- and LEO-based IFC solutions, (vi) satellite technology and ATG or hybrid technology.

[16] Commission Decision, supra., fn 1, paras. 135–153; and CMA Decision, supra., fn 2, paras. 7.21–7.25.

[17] Commission Decision, supra., fn 1, paras. 170–187, 200–203, 249–262, and 314–316

[18] The CMA, however, found that market shares are of decreased evidentiary value in the Transaction, as there are differentiations between the offerings and the market is characterized by tendering. See CMA Decision, supra., fn 2, para. 8.116.

[19] Commission Decision, supra., fn 1, paras. 204–214.

[20] See Commission Decision, supra., fn 1, paras. 263–300.

[21] Viasat explains that most of the European aircraft are not supplied with IFC, whereas, for example, for short haul flights, the penetration rate in the US is almost 73%. See the Commission Decision, supra., fn 1, para. 303; and the CMA Decision, supra., fn 2, para 2.37.

[22] Commission Decision, supra., fn 1, para. 289: “SpaceX has submitted request for regulatory approval to operate a constellation of 30,000 more LEO satellites.”

[23] Commission Decision, supra., fn 1, paras. 305(a) and (b). Intelsat and One Web distribution partnership for the offer of new multi-orbit IFC services, as well as One Web and Panasonic distribution partnership for hybrid IFC services.  See Intelsat Press Release, “Intelsat and OneWeb partnership brings multi-orbit connectivity to airlines worldwide,” August 11, 2022, available here; and Eutelsat Group Press Release, “OneWeb and Panasonic Avionics Corporation to deliver low Earth orbit (LEO) connectivity to airlines worldwide,” October 17, 2022, available here.

[24] General Electric/Alstom (Case Comp/M.7278), Commission decision of September 8, 2015.  See Commission Decision, supra., fn 1, paras. 264–265; and CMA Decision, supra., fn 2, paras. 8.132–8.154.

[25] Commission Decision, supra., fn 1, para. 265.

[26] Assessment completed by Cleary Gottlieb based on publicly available resources, in respect of the period January 1, 2018, to December 31, 2023.

[27] In March 2024, following a Phase 2 investigation, the CMA cleared the acquisition of Whirlpool by Arçelik because of changes in the competitive landscape, despite high market shares of the merging parties in the identified markets.  The CMA attempted to balance the decreasing market power of Whirlpool with other suppliers’ growth and intention to expand (See Arçelik / Whirlpool EMEA (Case ME/7044/23), CMA decision of March 7, 2024). Similarly, in October 2023, the Commission cleared the transaction without an in-depth investigation, given the presence of alternative suppliers in the EEA countries where both parties are active (See Arçelik / Whirlpool EMEA MDA (Case COMP/ M.11086), Commission decision of October 23, 2023).