Good morning, and welcome to the Iridium Communications Fourth Quarter Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Ken Levy, Vice President, Investor Relations. Please go ahead, sir.

Thanks Colt. Good morning, and welcome to Iridium's fourth quarter 2018 earnings call. Joining me on this morning’s call are our CEO, Matt Desch; and our CFO, Tom Fitzpatrick. Today's call will begin with a discussion of our fourth quarter results, followed by Q&A. I trust you've had an opportunity to review this morning's earnings release, which is available on the Investor Relations section of Iridium's website. Before I turn things over to Matt, I'd like to caution all participants that our call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts and include statements about our future expectations, plans and prospects. Such forward-looking statements are based upon our current beliefs and expectations and are subject to risks which could cause actual results to differ from forward-looking statements. Such risks are more fully discussed in our filings with the Securities and Exchange Commission. Our remarks today should be considered in light of such risks. Any forward-looking statements represent our views only as of today, and while we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views or expectations change. During the call, we'll also be referring to certain non-GAAP financial measures. These non-GAAP financial measures are not prepared in accordance with Generally Accepted Accounting Principles. Please refer to today's earnings release in the Investor Relations section of our website for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures. With that, let me turn things over to Matt.

Thanks, Ken and good morning, everyone. So by my count, this is the 37th quarterly earnings call we’ve held since going public in 2009 and it’s certainly one of our most satisfying in terms of results and achieving our long-term goals. As I am sure you saw in our press release, 2018 was an outstanding year for Iridium in terms of subscriber growth, financial performance and business execution. Our subscriber base rose 16% to over 1.1 million active users, top-line revenue grew 17%, our highest rate of growth as a public company and operational EBITDA rose 14%, our best in seven years. And of course, shortly into the year, we realized our crowning achievements the completion of Iridium NEXT. As a result, we entered 2019 with tremendous business momentum. We enjoy our best competitive position in corporate history and are now able to fully leverage our brand new powerful network platform. On February 5, the final Iridium NEXT satellite went operational completing our network of 66 new satellites. This historic event completes the decade-long design, construction and launch program retires a lot of execution risk, and allows Iridium to move from a period of capital investments to a new exciting era of free cash flow. As I reflect on this milestone, I am reminded that nothing in space comes easily and this journey has not been without its fair share of challenges. In completing the Iridium NEXT, we had to react to changes in technical plans, schedules and financial events along the way, always keeping in mind our objective. Some would say we also caught a few brakes along the way like the incredible resiliency of our original network. I would respond however that we made most of our own brakes, thanks in large part to the immensely capable and…

Thanks, Matt, and good morning, everyone. For nine years, Matt and I have been predicting a financial transformation for Iridium at the completion of the Iridium NEXT Capital Campaign. That day has now come and the transformation is underway. From this quarterly conference call forward, we expect to continue to talk about Iridium’s EBITDA growth, but we’ll also add new commentary on Iridium’s levered free cash flow. With the completion of Iridium NEXT, Iridium has become a rare company, one that is characterized by robust EBITDA growth and material levered free cash flow. In a few minutes, I’ll introduce some measures of Iridium’s levered free cash flow, we think our investors should consider moving forward. Let me start however by summarizing Iridium’s key financial metrics for the full year and provide some color on our fourth quarter results. I’ll then walk through the 2019 financial targets we updated this morning and review our leverage, liquidity position and suggested levered free cash flow metrics. 2018 was a record year for Iridium. Total service revenue grew 16%, our best rate as a public company and full year operational EBITDA totaled $302 million. This strong performance was driven by continued momentum in our commercial business and a meaningful ramp in hosted payload revenue associated with the deployment of Iridium NEXT. In the fourth quarter, Iridium reported total revenue of $132.2 million, which was up 14% from last year’s comparable period. This growth was attributable to incremental hosting fee and data service revenue in conjunction with strong trends in commercial voice and continued growth in commercial IoT. In the fourth quarter, operational EBITDA rose 19% from the prior year’s quarter to $75.5 million. The commercial side of our business remains strong in the fourth quarter generating record revenue of $85.3 million. This was a…

[Operator Instructions] And the first question comes from

We are ready for our first question.

And the first question comes from Ric Prentiss with Raymond James. Please go ahead.

Thanks, good morning guys.

Hey, Ric.

Hi, Ric.

Hey, obviously exciting times with the operational fully functional. So it’s a good news. A couple questions on the guidance side. Previously, the operational EBITDA excluded the revenues and recurring cost associated with NEXT. Can you also update us like in your 2019 guidance are you expecting that that adjustment will go away starting 1/1? Or is it go away starting in 2Q? Just what should we think about what’s baked into the guidance as far as that NEXT adjustment?

Sure, Ric. Substantially, all of the NEXT expenses in 2019 relate to the in-orbit piece of our launch insurance under GAAP. That needs to be amortized over the twelve months following launch, because that’s the coverage period. So, our launch is from 2018. The insurance associated with the in-orbit coverage get amortized into 2019 and since our last launch took place in January of 2019, we’ll have about less than $0.5 million that will also leak into 2020. That’s substantially all of the NEXT expenses and that’s about around $10 million bucks that will be excluded.

Okay. We also appreciate the update on the government contract. Has there been any impact from the government shutdown? And I guess, you said it’s moved toward the air forces and doing the negotiations. Just wondering, should we expect the April date is going to hold?

Yes, the April date is a sort of a firm ending that was – there is date in April that have to be completed by – it’s unlikely there would be an extension, but there actually – I am assuming they could ask for one, but it would have to be a appropriate new contract or some sort that would be appropriate for that sort of thing. But as far as like the shutdown effect for Iridium, I would say, generally not. Especially, since most of our interactions were with agencies that really weren’t affected by that. I didn’t really see any kind of necessarily business slowdown or anything from that perspective. So, we were sort of immune to that I guess.

That’s good. And the final one from me. Tom, you kind of touched on it obviously the balance sheet you mentioned debt refinancing in the short-term, are there any provisions, call provisions, any penalty points and how certain should we think that you might be able to go into the marketplace and obviously the pricing looks more attractive than maybe it would have been couple of quarters ago?

So, we are paying close attention to the market, Ric and the market backed up in December and it appears to be coming back. We are – so I would just characterize those as looking very closely at it. And couldn’t rule out something happened as early as mid-year.

Okay.

And, by the way, Ric, that will be the topic obviously for March 7 as well, I mean and I hopefully will be able to discuss that a bit more fully then to.

Great. Thanks a lot guys.

Thanks, Ric.

And our next question comes from Greg Burns with Sidoti and Company. Please go ahead with your question.

Yes. Hi. Just about Aireon, I guess the market opportunity there. You’ve been talking about a $750 million TAM. I was just wondering, based on the contracts you have in hand, how penetrated are they and I guess, we could start there. How penetrated are they into that opportunity based on the contracts we’ve already signed?

They have contracts in hand valued in the hundreds of millions of dollars, Greg. They are well down the road.

It’s still early days. So, I would say, it’s certainly probably less than a quarter or the opportunity so far yet even though it’s substantial. That $750 million is computed by sort of taking the way that they price their service by flight region and sort of multiplying it based upon each of those flight regions that’s sort of a 100% covered in the world and might not even include completely the whole all the commercial opportunities that are sort of a spin-out of having all those data available, things like what they do with Flight Aware and other kinds of services. So, it’s not an unreasonable expectation to see that the whole role someday will be, but it won’t happen for quite a few years. But given their fairly low costs in general, those are – that’s very, very high margin revenues. So very high profits overall in terms of what it’s able to support.

I think that the implications of them closing in a few hundred million dollar credit facility should – investors should reflect on that in terms of that this is a pre-revenue company that was able to close a loan like that. And use the proceeds to pay Iridium $35 million, that is a very strong indication of a robust operating model that that was able to secure that type of a financing.

Okay. And in terms of the $2 billion in capital you expect to return to shareholders through 2025, is that a reflection of your outlook for operational cash flow? Or is that also include maybe some dividends from Aireon? How do you get to that $2 billion number?

Sure. So, the building blocks are new disclosure around taxes. No cash taxes through 2023 and let me say the statutory rate is probably 24%, 25%. It takes us years to get to that level. So, cash taxes sub – after 2023 weather in very gradually and think of 2024 and 2025 as being low-single-digit kind of rate. So that the tax is an important component. We see leverage between 2.5 and 3.5 times in terms of net leverage we have on the company. And yes, we do expect a lot of things from Aireon, right. We expect the remainder of our hosting fees to be paid. We expect interest on that hosting fee. We expect dividends and we expect them to buy back the stock for a $120 million. Those are all components to our $2 billion expectation of capacity. So we say for shareholder returns obviously should a strategic opportunity present itself, that we think would be more beneficial to our shareholders. We would proceed accordingly but that $2 billion is a capacity number and the operating assumptions around that are – reflected on this business. Since we came public, we got a CAGR of about an EBITDA of about 9.5%. We’ve got some significant new revenue opportunities in the area of Certus that if Certus is what we think it is, we think we are on a path to putting up the same kind of results through 2025. I would say though, one doesn’t have to believe a 9.5% CAGR in EBITDA to get to $2 billion when you consider things like Aireon dividends and that sort of thing. So, that’s why we feel comfortable with the $2 billion number as the capacity.

Okay, great. Thanks.

And our next question comes from Hamed Khorsand with BWS Financial. Please go ahead.

Hi, good morning. So first off, could you just talk about the inventory of equipment at the retail channel and how much of that is old stock versus new stock? And how are you going about as far as commercializing the Certus service to minimize the amount of people on the old legacy service as you go forward?

Yes, I mean, if you just specifically talk about the, say the maritime opportunity that we have now, of course we’ve had a product in the market called open port for a number of years here and it still continues to do well even as we move into this year. It isn’t suddenly fallen off. It’s actually still being put on ships because it works so well and it’s reliable and a lot of people are comfortable with it. There is probably still quite a bit of inventory out there of open port. It’s hard to tell exactly how much. But we get the impression that there is still a fair amount of inventory and I expect that that will continue to be deployed even going on through this year and perhaps into next year as well. At the same time, you have these new Certus terminals are also now shipping from our primary suppliers of Cobham and Thales and we see – we can kind of get visibility to the number of transceivers we sent to them and how many they tell us that they’ve been shipping that a fair amount of those are now going into the roughly 38 partners that are out there distributing them to their distributors and those are starting to get into the channels now. And so, again, we’ve seen some pretty good activations even over the first months as that product starts to ramp into the market. So, I think we are going to see both products continue to go for a while. But, in the long run, I think, Certus, given its performance, value and everything else is going to be the predominant product. Assuming you are mostly talking about broadband as opposed to handsets and IoT services because those are – that’s all new stock out there in the market, if you will.

Are you doing like a mandatory push to Certus service? I mean, how are you going about as far as managing the conversion and just getting people to convert the new service?

So, I would say that this isn’t about conversion. Well, it is about conversion. It’s conversion of our competitors’ products into our service, because they’ve been the one for the last 20 years that have been the sole one to offer a service. And so, there is a lot of interest in our regard of taking of converting those customers to our customers with a better product that has a higher value and longer-term dynamics. We are not managing a conversion per se. Our partners naturally want to deploy that product because it’s competitively superior. They like the idea that we are not a competitor to them. They see its performance and that it operates more globally than other products. The antennas are smaller and lighter and easier to operate, et cetera. So, it naturally is going to go into the market. As we said, we are trying to measure our own expectations about how fast that is. But, based on everything we’ve seen and talked about it makes us comfortable with sort of the guidance we’ve given on the next three years of deployment for it. But we are really not trying to convert our existing 9,000 to 10,000 open port subscribers. I am expecting that over time that those will be upgraded and in fact, given the fact that the speed and other things are faster, I would expect ARPUs might even increase on the ships when those get converted. But I’d really rather more focus on converting my competitors’ products than our own.

Okay. Thank you.

Thanks, Hamed.

And our next question comes from Chris Quilty with Quilty Analytics. Please go ahead with your question.

Thanks. Tom, just a clarification on the guidance. The service revenue number you provided includes or excludes the – any hosting fees? And can you also give us a break down of how the hosting fees would look in 2019 with the component pieces?

Sure. So, yes. The service revenue guide has always included the hosting fees and the hosting fees – think of it in the way this way, Chris, they ramp to a steady state full ramp of $47 million. This year, we think we’ll be somewhere in the $35 million to $40 million range. Given effect to all the hosting revenues the only component that bridges from the $35 million to $40 million to the $47 million if full ramp is – as to the Aireon data fee, there is a customer contract – sort of concentration milestone that takes that from $13 million annually up to $23 million and we are expecting that that will occur in the second half of 2019. Such that, 2020, if you will, would be a full $47 million up from the $35 million to $40 million we expect this year.

Gotcha. And the other component of that, if I remember correctly, the Aireon hosting fee is around $16 million.

That’s right. And I think of Aireon at $16 million, $23 million and $16 million $23 million in data, $16 million in hosting at full ramp and Harris about $8 million. So that’s how you get the $47 million.

Okay. Good. With the equipment, you mentioned also, equipment down. Is that down a little or down hard? I mean, as you begin to shift to more of an outsourced model on pushing those – put in revenues out to your partners, how quickly does that come down and is that driven primarily by the adopting of Certus? Or are there other factors at play?

No, it’s nothing to do with that, because just handsets were very strong this year. If you looked at a three year trend, the 2018 handset shipments and sales jumps off the page. We’ve seen that softening to more historical levels and our guide of down reflects what we are seeing. I would say, it’s going to be down. We wouldn’t bring it up. It would be down not immaterially. But that’s the degree of the decline is fully anticipated in our EBITDA guidance.

Gotcha. And there seem to be a step-down in the government voice business in Q4. Was that just kind of end of year housecleaning on their part?

No, no. You mean, the service revenue is at $22 million. I mean, that’s contractual.

No, no. Number of subs.

Number of subs?

There was a clean-up. Actually, there was good growth in the quarter. But there was one service that sort of had an optimization thing that was going on and they over a period of just a week or two, sort of cleaned out a number of subs that were – they didn’t think were really active or we are in the field or anything like that just to optimize their sort of service number. So, it was just a one-time sort of clean-up from one place that I guess affected sort of and made it look like it’s flat even though there were still growth in other areas.

And actually, now that I think about it. Are we still dealing mostly with the old 9055 handset? Or has the new certified handsets been approved and shipping out to the market?

Yes, the – what we would call, the 9575A which is the secure device, I think went into service early in the year. It was actually – it was shipping quite well and quite a few of them went out in 2018, it’s proven, it’s looks like a very popular device. We actually had a gap for a while I think going back in 2017 when we ran out of the old 9505s that used to use a secure devices. But now it’s back into full operation with the 9575A. It’s continued to be a popular service, but, I mean, remember they are also now doing tactical radios, a lot of IoT business and we are already starting to see some Certus revenues from the government, particularly in the Land Mobile side they are driving a lot of the initial sales, as they put things on certain vehicles and that sort of things to provide broadband services.

So, how are they paying for Certus. Do you have an – if I recall, that contract for Certus service is going to be separate from the EMSS contract that you are negotiating obviously neither of those are in place. So I am assuming this is more special operation using their funny money?

Well, it is true that variable rate services are clearly with higher speed data is always going to be a separate sort of contracts in revenue stream from our fixed costs narrow-band services. So Certus is new revenues. They are going to ultimately – today, those are I think flowing really primarily through our commercial business as opposed to the government line until the government’s gateway gets fully in operation which they are moving towards right now that and that will give them a complete secure capability. But because they have so much interest, they have been deploying some initial product using going through our commercial gateway and through our commercial revenue line. But those will be based upon how much service they deploy. What speeds they operate? How much data is flown – flows through it? And that will be independent of our EMSS contract.

Okay. And sticking with the voice theme, an update on push-to-talk, is that starting to gain traction either government or commercial/industrial?

We have had nice pick-ups lately. I would say that we are really excited about a new terminal coming in the second quarter. Many of you heard that a partner Icom, Japanese supplier is very – making very good products, really impressed with the initial device that I’ve seen going through certification right now. It’s on track to probably deliver in the next few months and we think it’s going to really, really make our push-to-talk service even more attractive. Our previous handset which was built on our 9575 handset was good, but it really wasn’t built to be a push-to-talk device and I think once we have a purpose-built device for that, that’s really going to help convert a lot of the opportunities we still see around the world. Still lot of interest and we are getting new customers every month for that. I’d say overall, it’s still small compared to our – the rest of our business, but we still feel very positive about the future and potential of that business.

And one final question shifting back to the commercial IoT business. Good numbers in Q4. But in terms of subs, on the consumer side, presumably, things were shipping for the Christmas season. They really don’t show up as subs until the first quarter. Are you getting any good indication of consumer uptake for some of your devices and notably that be the Garmin inReach which seem to get some good coverage from them and their earnings call.

Yes, I mean, that’s a little forward leaning here in terms of sort of not hitting the 2018 results as you said. But I can tell you we continue to see really robust IoT subscriber growth and have really good expectations for broad based growth. Garmin in particular, really continues to execute extremely well. Just very impressed with them as a partner as they both expand their product lines and their distribution around the world, we clearly see in our results, I think you are going to continue to see it in the coming years in our results. We are continuing to look to diversify even beyond that. But right now, I am pretty excited about future products that they have as well. It’s clearly this is, I think they have seen positive results from sort of connected devices in their channels as well. And I think that that’s going to be a great partner in the coming years.

Great. Thank you.

Thank you.

And our next question comes from Anthony Klarman with Deutsche Bank. Please go ahead with your question.

Hi, thanks. Just a couple of questions. First, I apologize if this came out in the text of the commentary and I missed it. But I wanted to just understand on the 2019 outlook. What that assumes in terms of the runrate for the government contracts and to the extent it was the government contract at current rate, would you envision providing us clarity on sort of what the new contract looks like when that is signed by revised guidance or sort of giving us what the incremental runrate might be?

Hey, our guide assumes what we expect to be the increase effective April 19th. That would be a stub period. So that we’ve put – we’ve included what we expect the increase to do. We haven’t disclosed that. And certainly, the government contract would be material that it’s terms would be disclosed and if it’s materially different than our guidance, we would update accordingly. But, we have factored in what we think the increase is going to be in our guide.

Got it. So it’s essentially why that be the current runrate for 1Q, the stub period for 2Q and then the new runrate for the full period for the back half of the year?

That’s right.

And then, I guess, if I look at that and then I look at the guidance around the $75 million in incremental broadband opportunity, can you just talk about what the path of that or what the rhythm of those numbers look like as they pace out? Because I guess, if I just pull the current runrate of the business forward and I layer in some incremental broadband opportunity plus, some modest presumed step-up in government, the guidance certainly looks like it is on the conservative side. Can you help us just think about maybe if there are other one-timers or puts and takes in there that we should consider? Or how the ramp of the EBITDA progresses throughout the year?

Yes, so there is a one-timer there and I did talk about in my commentary, which is on our satellite time and location, we had a $4.5 million true-up there. We – the Telus is a start-up operation in the contract with them that gets us should come into revenue at $5.1 million a year notwithstanding the fact that the payments are not leveled or back-ended as you’d expect with the start-up. And so, in the early years, we could have recognized $5.1 million, but given the fact that the collection of that was not probable. We only collected what we’ve got in cash. There were developments there this year that caused the certainty of the collection to cause the probable line and so that’s – so we basically brought in the revenue that we chose not to recognize in prior periods. And that was a benefit to 2018 that implicitly decrements the year-over-year growth in 2019. So, pro forma for that, the 2018 revenue growth looks like 16% of it come down to 15% and the 2019 growth would not be 8%, it would be more like 9.4%. So that’s the answer your question in terms of the one-timers. As we think about the growth, if you take the kind of pro forma 9% growth into 2019, there is very little Certus in there. And so, if you model a ramp to $100 million, you see the Certus revenues into 2020 and 2021 to get to a $100 million exit rate, there is material growth there that takes that 9.4%, 2019 pro forma growth well into the double-digit.

Understood. Thanks. And then, I know we’ve covered this previously. But I was wondering if you could maybe remind us, you mentioned Aireon’s remaining hosting fee become payable to Iridium. Can you just remind us if there are any milestones that still need to be achieved that would trigger additional payments from Aireon to Iridium? Or whether it’s just sort of the commencement of commercial operations on there and that will change the revenue rec? And then a reminder on what the timing is on the equity repurchase agreement?

So, the facility that they just closed contemplates an additional payment to Iridium of $15 million pending them signing up some contracts that they are looking to do. What we have said is that, we expect there is that payment and still it could be expended, but we expect it to be fully paid by 2021 as to the hosting fee. And then the buyback of the stock would be subsequent to that hosting fee payment in 2021.

Got it. Okay. And then, Tom, just finally on the refinancing comment you made, I was wondering if – when you talk about the refinancing, you are talking about just the BPI piece or if you are all talking about more of a holistic refinancing in light of I think you’ve sort of mentioned that the refinancing could cause shape out of the quarter turn with respect to the net leverage target that you have?

Right. So, we think about as a two-step process. With the first step would be to refinance the BPI facility and then, we have our eyes on the high-yield bond when it becomes economical kind of in the April, May timeframe of 2020.

Got it. So, you would imagine that the high-yield bond probably stretches out somewhere close to the first call date?

Yes, we have our eye on the first call date. Yes, we have our eye on the first call date there.

So, I guess, I am not aware of – then, I guess, in mentioning the quarter turn impact to net leverage, I guess, other than just sort of normal fees and expenses, I am wondering what the breakage costs are on the BPI? Is there a call protection on that facility or is it pre-payable and what would lead to that quarter turn and incremental leverage?

Yes, there are – it’s not that it is. We’ve assumed as there are things going both ways. There is money that’s due back to us and there is swap fees that they can make claim to. In our quarter of turn, we are just purely dealing with the fees to put in at a range of $1.5 billion credit facility. So, we model the exit cost, if you will, from the BPI facility it’s kind of neutral and we think we are being kind of conservative there. And so, our quarter turn of leverage is just because we have a former guide out there of 4.5 times. We would be remised if we didn’t say, hey look, we are also thinking about refinancing that could make that go wide by about a quarter of turn should we do it.

Got it. And when you say, exit cost, I guess, my presumption was that, you could probably refinance BPI into a normal way first lean credit facility at an all-in rate that’s below PCI. But are you assuming for modeling purposes that you should think about it as maybe flat?

No, it’s not. It will be – the cost will be up, because that’s 5% money. So we’d be – we fully anticipate that our interest cost will go up. But it’s the right thing to do for the business. We need the flexibility of a regular way financing to run our business that was – the BPI facility was a wonderful instrument to use during the construction period, but we need to run a business at this point and are focused on paying dividends and buying back shares now which we can do with that facility.

Yes, understood. Thank you.

[Operator Instructions] And our next question comes from Louie DiPalma with William Blair. Please go ahead.

Good morning, Matt, Tom, and Ken.

Good morning, Louie.

For the EMSS contract, do you expect it’s gradually increased from year one to year five similar to the existing contract?

It’s a little too early to give that kind of guidance to be honest with you. We are still in discussions that could go – I think that’s the most likely approach. But we wanted much flexibility as possible here. Overall, the total value should go up because the usage and cost per user have come down dramatically and the expectations of future usage are really strong right now given all the different projects that the government has going to deploy the technology on, but exactly how that will be profiled over the next number of years, I can only say broadly that’s probably just a general expectation. But we’ll know in a month or two.

Okay. And also on the defense side, you mentioned, or I think you mentioned a new Department of Defense Certus Gateway. Is that a separate gateway from their VOIP gateway in Hawaii?

No, it’s additional equipment that would be built and installed at that location. So that they can take and deliver basically Certus service through the same sort of approach of secure global service. But that’s actually been under development now for a while. They have committed to deploying it and there is a plan right now to do that over the next year or two to deploy that technology.

Okay. And I am assuming it’s necessary for that gateway to be completed before they establish a Certus contract with your partner COMSAT?

No, I mean, they could have that. I mean, the revenues would maybe flow through COMSAT through the commercial our commercial broadband lines if you will and we’ll account for it through the commercial service. So they can deploy service and COMSAT can be involved. They just won’t go through our government’s line, if you will, and to the government gate.

Gotcha. And lastly, your competitor Inmarsat, they are beginning to announce vendor contracts for their new sixth generation I-6 L-band constellation. Are you confident that your Certus services with Iridium NEXT will be able to achieve similar levels of performance relative to their future constellations?

I believe very confidently in our business projections around what Certus will do for many years. I – Inmarsat or anyone else here deploying their service, it’s not again about speed. Add another megabits per second might be interesting, but again it’s more about cost, size, coverage, competitive dynamics, et cetera. By any measure, we should never have been able to sell an open port device over the last ten years because there is a fraction of the speed that supposedly the headline speed of what Inmarsat did and of course, we did quite well with that. I think, Certus is going to carve out – and by the way not just exactly identical services to what they do, but I think it’s going to expand the market. For example, they really can’t do effectively what we can do with our MissionLINK Land Mobile business right now, because we are providing a highly mobile service, broadband-on-the move instead of what you could call broadband on the pause, where you really have to kind of set up or have an extremely expensive antenna to do that. Those kind of advantages are going to remain well into the future and someone might come up with a higher headline rate than their megabit or so that we are doing. But just having a 2 megabit terminal or a megabit-and-a-half or whatever they want to call isn’t really what it’s completely about, because it’s not just speed that really is going to be I think the competitive dynamic for in the coming years. So, I am really confident with the – really potential that we have for Iridium service – Certus well into the future and you could also see that how excited we are at our area that I don’t know that anyone can compete against this, which I call the 100 kilobit per second and below using low-cost model antennas. That’s going to be a whole brand new market that I don’t think anyone can touch us on and no one looks like they’re even designing anything to go after that market.

Sounds good. I look forward to hearing more about the 9770 on March 7th.

We will be good to see you Louie and I think that will be a great chance for us to really expand and tell our story a bit more broadly. So, I hope everybody tunes in for that to if you are not with us.

And this will conclude our question and answer session. I would like to turn the conference back over to management for any closing remarks.

Well, obviously it was a great year and it’s exciting to have a brand new network in service. I know you’ve been following us. As I said for a number of times, I think March 7th is going to give us an opportunity to really flush out the story, our strategy going forward and how people should be looking at us and it’s going to be an exciting year. So, thanks everybody for joining us again.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.