What: Shares of Globalstar (NYSEMKT:GSAT) surged 10.4% Tuesday after the mobile satellite voice and data services provider announced a new partnership with Avidyne, a leading provider of integrated avionics and automatic dependent surveillance-broadcast (ADS-B) systems for general aviation aircraft.
So what: According to Globalstar's press release today, it will work together with Avidyne to "develop and certify satellite-based Internet and voice communications products for the aviation market." These products will leverage Globalstar's second-gen satellite network, and be exclusively provided by Avidyne to aircraft manufacturers through its worldwide dealer network.
This means that aircraft owners and operators will have affordable Internet access products and services with much higher data speeds via Globalstar's new network for light and medium aircraft. In addition, Globalstar says the new products will include effective backup communication systems for larger business aircraft equipped with high-bandwidth satcom, or air-to-ground communications systems.
"We are laser-focused on continuing to make Globalstar the market leader for the growing data communications needs around the world, added Globalstar CEO Jay Monroe. "This partnership represents another step forward in that endeavor as we find ways to adapt our technology to the needs of the aviation sector."
Now what: Avidyne CEO Dan Schwinn elaborated that, in addition to Globalstar's second-gen satellite network, the new products and services will also rely on new ground infrastructure upgrades set to go live during the next few months. Meanwhile, Globalstar promises more specific details are "forthcoming" for new certified Wi-Fi-enabled products and services.
Though it remains unclear exactly how much incremental revenue this partnership could mean for Globalstar at this point, with shares down more than 50% during the past year, and the company on the cusp of sustained profitability, it's hard to blame the market for celebrating any good news.