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Satellite services struggle to reach escape velocity


FORT LAUDERDALE, Fla. -- The government has been using low Earth orbit satellites to track manatees, caribou herds and storm systems for nearly 20 years. But Ralph de Palma and Margaret Jordan have bigger game in mind.

They want to use them to track 20- and 40-foot cargo containers filled with bananas, mangoes and melons through the Caribbean.

The two are partners in Caribbean Satellite Services, an 18-month-old company that is pioneering commercial uses for low Earth orbit, or LEO, satellites from its office overlooking the Port of Miami.

"The boom is coming and we are on the bow wave of it," said Mr. De Palma, who spent much of his career as an engineer for Eastern Airlines and Lockheed Space. Ms. Jordan, a former consultant with Booz Allen & Hamilton, joined the venture last year after Mr. De Palma asked her to draw up a business plan for the venture.

Whether the duo can ride the wave all the way to shore is another question. A host of major corporations are expected to enter the LEO business in the next few years, and Caribbean Satellite is having a hard time persuading the maritime industry to adopt the new technology.

The company is one of about a dozen now trying to resell time on government-owned LEO satellites to the transportation industry, according to Stephen Morgan, business development manager for Starsys. The Lanham, Md., company is licensed to sell time on Argos, an LEO satellite system owned by the U.S. and French governments.

These small, entrepreneurial companies are trying to persuade companies with large fleets to install transceivers on their equipment that can transmit location, temperature and even humidity levels to LEO satellites.

Caribbean Satellite is focusing on helping steamship lines track and monitor refrigerated containers, the chassis they sit on and the $14,000 generator sets used to power them. It is trying to convince steamship lines that for as little as $1.50 per container per day, they can be alerted to break-ins any where in the Caribbean Basin or make sure the fresh produce in a container does not spoil.

The company has dubbed its service Smart Container, because the transceiver interacts with microprocessors installed in most modern refrigerated containers.

Mr. De Palma and others say such services will revolutionize the steamship industry by allowing cargo lines to keep daily inventories of their huge container fleets for the first time. On any given day, a cargo line could have thousands of containers strewn across dozens of ports and ships in the Caribbean Basin.

"It's such a laborious process, right now it's only done very infrequently," said Mr. De Palma. "Now it can be done once a week."

Confronted with an array of technologies, most major steamship lines are probably inclined to favor less costly and exotic technologies, said Kip Hinkel, general manager for refrigerated operations for the giant Maersk Lines of the Netherlands.

None feels any pressing need for satellite monitoring.

"That's a misconception all these satellite guys have," said Mr. Hinkel. "They envision some big space-age facility with a big map with dots all over it. They understand technology, but they don't understand the steamship business."

With 500,000 containers worldwide, Maersk has one of the world's largest container fleets and has successfully tested Smart Container. But at $1.50 per day, Maersk would have to spend nearly $11 million to equip its fleet of 20,000 refrigerated containers for LEO satellite tracking, he said.

"We know if we put a container on a vessel in New York, it will be in port in Le Havre [France]," Mr. Hinkel said. "Why spend the money to find out where that is, when we know it's on the vessel?"

Maersk is considering testing Smart Container service again to see if it can help the company track whether truckers are using their chassis to haul third-party cargo.

And Mr. Hinkel thinks Smart Container might be a good solution for smaller, less sophisticated steamship lines plying the Caribbean.

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