Today, the satellite companies Eutelsat and OneWeb are pushing the benefits of a proposed merger whereby the shareholders of each company would hold 50% of the Eutelsat shares. The companies first proposed merging in July 2022.
They say that combined they could focus on the broadband satellite connectivity market by offering the first global combined GEO/LEO infrastructure.
The companies first began collaborating together in April 2021 when Eutelsat announced a $550 million investment in OneWeb for a 24% equity stake. Since then, they’ve worked together on commercial distribution partnerships and joint technical initiatives. Their technical work has included collaborations on common workstreams for hybrid GEO/LEO infrastructure, bringing together OneWeb’s LEO constellation with Eutelsat’s GEO fleet.
OneWeb already has its Gen 1 LEO broadband constellation in service. It's delivering average global one-way latency of 70 ms, download speeds of up to 195 Mbps, user terminals adapted for each market and a suite of fully managed connectivity services. OneWeb’s Gen 1 has already been fully funded.
OneWeb says it has over $600 million in total contracted revenues and a pipeline of up to $1.9 billion spread across its four key verticals of Enterprise, Government, Aviation and Maritime, underpinned by distribution partnerships with major players in each segment and over 150 customer trials underway.
If the merger between OneWeb and Eutelsat is allowed, the companies say they will begin working together on the design of OneWeb’s Gen 2 LEO constellation.
They say that jointly they can save capex. As a follow-on constellation, Gen 2 will benefit from the re-use of existing ground infrastructure, the know-how developed with Gen 1, and already secured priority filings, while also being designed as part of a broader GEO/LEO structure rather than a standalone entity.
Eutelsat and OneWeb say they have a clear roadmap for the integration of their respective in-orbit and on-ground assets, culminating in a fully integrated GEO/LEO network with the entry into service of OneWeb’s Gen 2 by early 2028.
Eva Berneke, CEO of Eutelsat, and Neil Masterson, CEO of OneWeb, stated: “The proposed combination between Eutelsat and OneWeb represents a decisive leap forward for satellite connectivity. Eutelsat’s initial investment in OneWeb was underpinned by a strong belief that the future growth in connectivity will be driven by both GEO and LEO capacity.”
Satellite connectivity has recently taken on new excitement in the telecom sphere because of announcements between SpaceX and T-Mobile and between Apple and Globalstar. These companies are working on technology where satellites connect directly to existing mobile phones.