In the new race for space, Europe has fallen far behind, trailing Starlink in satellite-based communications. Recent disruptions to Starlink services in Ukraine highlight the urgency for Europe to catch up, requiring more than large cheques. Currently, Eutelsat's One Web is the main alternative, but it lags with 600 low Earth orbit satellites compared to Starlink's 10,000, positioned further from Earth, making it less suitable for battlefield combat.
Europe is scrambling for alternatives, including the IRIS² constellation led by SES, Eutelsat and Hispasat, with first launches expected in 2029 and a fleet of 348 satellites. Meanwhile, telecom giants Vodafone, Telefónica, Orange and Deutsche Telekom are exploring acquiring spectrum for mobile satellite coverage. While satellite broadband for rural communities is valuable, replicating defence capabilities demands huge subsidies.
A recent €15.6bn IRIS² budget suggests a satellite cost exceeding €40mn, versus Starlink's $1.3mn. Furthermore, European rocket-launching technology lags, with only 7 per cent of satellites launching on European rockets. SES is highly indebted, and Eutelsat lacks sufficient cash flow.
Fragmented space capabilities among countries and contractors hinder progress. To compete with the US, Europe may need to loosen regulatory reins and offer bigger subsidies. Goldman Sachs estimates large government orders could provide SES with €500mn in incremental revenue from 2030-2035.
Fast-tracking competition approval for Airbus, Thales and Leonardo's combination, and allowing telecom mergers, are underway. However, tight telco regulations may stifle innovation. Consumers may face higher costs to bring European tech closer to Silicon Valley's spirit.
The situation in Ukraine underscores the stakes.
Fonte: Financial Times Companies · Resumido por HeadlinesBriefing