Four of Europe's largest telecoms groups are exploring launching their own satellite mobile services to challenge the dominance of Elon Musk's Starlink, potentially inflaming transatlantic tensions over communications technology. Deutsche Telekom, Orange, Telefónica and Vodafone signed a letter of intent on Monday to explore a potential joint bid for radio wave spectrum enabling "direct-to-device" satellite mobile services in Europe. The move comes amid an intensifying geopolitical dispute over satellite telecommunications.
In May, the European Commission proposed reserving the part of its spectrum band that allows smartphones to connect directly to satellites for European players. The so-called 2 GHz frequency band is currently used by two American companies, Viasat and Echo Star, whose licences expire next year. The proposal has become a transatlantic tension point.
Last week, the US ambassador to the EU told the FT that European companies would face "devastating" retaliation if the bloc did not change its proposal, which would be prejudicial against US companies such as Starlink. Space X warned the move risked poorer connectivity in Ukraine where Starlink has been critical to civilian and military communications since Russia's full-scale invasion. Starlink has been at the centre of controversy this month after its services were disrupted in Ukraine amid tensions between US President Donald Trump and Ukrainian counterpart Volodymyr Zelenskyy.
The EU is pushing to reduce Europe's heavy reliance on core digital infrastructure provided by suppliers outside the bloc. The initiative would mean companies establishing the necessary ground infrastructure, or base stations, needed for satellite connectivity. Instead of developing their own satellite constellation, they would partner with an existing provider, which is yet to be selected.
French satellite operator Eutelsat has developed a large-scale constellation but is far behind Starlink, which has more than 11,000 satellites in orbit. Goldman Sachs analyst Andrew Lee said the move was a "reassuring reminder to investors that European operators see satellite as a companion technology to their domestic networks and that European authorities wish to carve out satellite-ready spectrum for European players".
Source: Financial Times Companies · Summarized by HeadlinesBriefing