Eutelsat and OneWeb to join forces across orbits in $3.4b merger
- Reference: 1658837815
- News link: https://www.theregister.co.uk/2022/07/26/eutelsat_oneweb/
- Source link:
Unlike rival Starlink, which has thousands of satellites in Low Earth Orbit (LEO), the [1]combined company would operate satellites both in Geostationary Orbit (GEO) via the Eutelsat's 36-strong fleet and LEO – via OneWeb's constellation, which currently stands at 428 satellites.
There are pros and cons to satellite locations: a GEO satellite has better coverage over a specific region while LEO satellites carry the promise of lower latency and are generally cheaper to build and launch, although more are needed. Combining the two should, in theory, deliver a best-of-both-worlds system depending on the challenges of integration and customer requirements.
[2]
As for how the deal will work, the transaction values OneWeb at $3.4 billion (implying a value of €12 per Eutelsat share) and Eutelsat shareholders and OneWeb shareholders would each hold 50 percent of Eutelsat shares. Effectively, Eutelsat ends up owning 100 percent of OneWeb (excluding the UK government's share.)
[3]
[4]
The UK government's stake is significant, since £500 million (c $600 million) of UK taxpayer cash was spent on [5]OneWeb two years ago .
Eutelsat itself has also invested heavily in OneWeb, and made an initial investment of $550 million in April 2021, and then [6]spent another $165 million in October last year, taking its shareholding from 17.6 percent to 22.9 percent [PDF].
[7]
The UK's Department for Business, Energy & Industrial Strategy [8]said : "The UK government will retain the special share and its exclusive rights over OneWeb – securing the company's future at the centre of the combined group's global LEO business, national security controls over the network, and first-preference rights over domestic industrial opportunities."
The latter point is significant. As well as national security needs, the UK is to be the "preferred" location for launches as well as procurement for commercial manufacturing. Unfortunately for UK businesses, this also means that the country will be competing against other states for OneWeb work, "as usual for major European space projects," [9]observed Dr Bleddyn Bowen, Associate Professor in International Relations at the University of Leicester.
[10]SpaceX and OneWeb bury the satellite constellation hatchet
[11]No BS*: BT is hooking up with OneWeb to tackle UK notspots
[12]Amazon books rocket flights for its Kuiper broadband internet satellites
[13]We're not getting back with Galileo, UK govt tells The Reg, as question marks sprout above its BS*
The merger, which is expected to be complete by the first half of 2023 (subject to regulatory approvals and a nod from Eutelsat's shareholders), is expected to generate combined revenues of €1.2 billion (c $1.22 billion). While OneWeb will continue to operate the LEO business and remain headquartered in the UK, France-based Eutelsat will continue to be listed on Euronext Paris and apply for admission to London Stock Exchange.
And who knows, by the time that 2023 completion rolls around, OneWeb might finally have got some more of its proposed constellation off the ground. The last batch of satellites never left Baikonur after Russia's invasion of Ukraine, and OneWeb has since signed up several alternative launch operators, including SpaceX, to launch the remainder of its satellites.
That's assuming SpaceX can find time in between launches to build the Starlink satellite constellation. The company [14]launched another 53 of the satellites into orbit on July 24, SpaceX's sixth mission of the month. ®
Get our [15]Tech Resources
[1] https://www.eutelsat.com/en/news/press.html#/pressreleases/eutelsat-and-oneweb-to-combine-a-leap-forward-in-satellite-connectivity-3195697
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/science&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YuAPnyvBOkh8NL83lzVtggAAAA4&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/science&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YuAPnyvBOkh8NL83lzVtggAAAA4&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/science&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YuAPnyvBOkh8NL83lzVtggAAAA4&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2021/03/25/uk_pm_johnson_relucant_to/
[6] https://www.eutelsat.com/files/PDF/investors/2021-22/PR_2130_OneWeb.pdf
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/science&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YuAPnyvBOkh8NL83lzVtggAAAA4&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[8] https://www.gov.uk/government/news/oneweb-merger-with-eutelsat
[9] https://twitter.com/bleddb/status/1551875800663744512
[10] https://www.theregister.com/2022/06/15/spacex_oneweb/
[11] https://www.theregister.com/2021/06/28/bt_oneweb_deal/
[12] https://www.theregister.com/2022/04/05/kuiper/
[13] https://www.theregister.com/2020/09/21/no_galileo_uk/
[14] https://twitter.com/SpaceX/status/1551204106471030784
[15] https://whitepapers.theregister.com/
Given the hoo-hah about the great UK venture into satellite comms that was announced when HMG bought into OneWeb I doubt there'll be any great bragging about this one. At most it'll be passed off as a merger which is the Beeb version although it looks more like a takeover by Eutelsat. It's probably the best they could have hoped for.
It is indeed a takeover. OneWeb has been looking for more money for a while, even after the UK government investment, and they seem to have found it in Eutelsat.
That shouldn't hinder any coverage. When ARM was sold to the Japanese in September 2016, a few months after the controversial referendum, it was hailed as "A sign of confidence in Britain that a Japanese company was investing in the UK!".
If EutelSat does end up with 100% then all those commitments to the UK will be null and void as the French courts will be happy to confirm.
Though I think this is largely going to end up as a transfer of assets and not lots of new money as problems relating to LEO wheezes mount up.
WTF
Why the fuck are the brexshitters joining their shitty NOT gps alternative to "europe"?
Sounds like treason to me.
nervermind I'm sure some of Borshits mates have made plenty from it. they'll be able to buy him some new tacky gold wallpaper after the move.
Compatibility?
I guess that Eutelsat and OneWeb did not develop their satellites to be compatible with each other, e.g. the GEO bird serving as a relay for LEO birds.
So, getting anything out of the "best of both worlds" bucket is most probably merely an aspiration for some distant future, and not something that magically materializes post-merger.
Re: Compatibility?
It's indeed quite unlikely that the sats are already compatible. Though perhaps they could do something with combining it in the consumer equipment.
The benefits of GEO are its massive footprint, a single satellite can cover half a continent. The downsides of GEO for internet are the latencies because the sats are so far away.
The benefits of LEO are the low latencies because they are quite close to earth. The downsides of LEO are the enormous amounts of sats needed for decent coverage. [1]Apparently OneWeb has a roadmap for 648 LEO sats at this stage .
I remember they used to pull stunts such as sending the uplink (and thus the request) from consumer to server over a copper cable to keep the latency low and then send the download over the GEO sat because of its enormous (for the time) bandwidth.
If Eutelsat consumer premises equipment can receive from the GEO sats but send to the LEO sats you might be able to pull something similar off. You could have fast, low latency, internet in your remote Alpine hut.
[1] https://tech.eu/2022/07/26/combined-space-eutelsat-and-oneweb-sign-merger-valued-at-3-4-billion
All about the Benjamins
Like all mergers we'll hear the standard PR twaddle about compatibility and synergy.
Like all mergers it will result in layoffs and cost cutting.
All beancounters measure success by this quarter's bottom line while the suits look to their yacht maintenance.
SpaceX and OneWeb seem to be getting friendly recently
https://www.theregister.com/2022/06/15/spacex_oneweb/
And prior to that, SpaceX already agreed to launch OneWeb sats.
https://oneweb.net/resources/oneweb-resume-satellite-launches-through-agreement-spacex
Not sure if this new deal with Eutelsat will make any changes on the above.
And SpaceX has launched EutelSat's birds at least once before.
https://www.space.com/33171-spacex-eutelsat-abs-satellites-launch-rocket-landing.html
So can't say what the future holds after this.