OneWeb Satellite Broadband Effort Gets $500M

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OneWeb, intent on building a 900 satellite Low-Earth-Orbit (LEO) broadband network encompassing the globe, released a flurry of information today.  The company announced it secured $500 million in A-round funding, with participants including Airbus Group, Bharti Enterprises, Hughes Network Systems, (Hughes), a subsidiary of EchoStar Corp., Intelsat, Qualcomm Incorporated, The Coca-Cola Company, the Virgin Group, and Totalplay, a Mexican broadband provider.   It also signed contracts for a whopping 21 launches through Arianespace and 39 LauncherOne missions from Virgin Galactic.

About the only thing OneWeb founder and CEO Greg Wyler could have done to finish the announcements is to ‘drop the mic’ at the company's London press conference and walk away.  If everything lives up to expectations, OneWeb has changed the playing field for the space industry through economies of scale and partnerships.

Last week, OneWeb  announced a joint venture with Airbus to build 900 satellites, delivering more than 10 Terabits per second of new capacity in the sky when the constellation is finished. The first 10 pilot satellites are to be built in France, with the rest built in the United States at a purpose-built factory. 

Each satellite weighs around 330 pounds and would provide high-speed broadband to low-cost ground stations using Ku-band frequencies at around 50 Mbps.  The first 10 pilot satellites are expected to be launched in a single Soyuz mission out of French Guyana in 2017, followed by a combination of Soyuz launches from Guyana, Baikonur in Kazakhstan, and additional launch pads in Russia to have a full constellation deployment by the end of 2019.

OneWeb's LEO constellation provides high speed access for voice, video and other real-time communications needs, with signals relayed from satellite to satellite in an Internet-style network, rather than having to travel 22,500 miles up and back as with traditional geosynchronous earth orbit (GEO) networks. Iridium is the only comparable LEO network currently in operation, using L-band and 66 satellites in LEO to deliver voice and data up to 1.5 Mbps.

Image via Shutterstock

The OneWeb launch commitment to ArianeSpace, the largest contract for commercial launch vehicles in history, includes an initial twenty one (21) Soyuz launches, plus options for 5 additional Soyuz and three Ariane 6 launches.  Such a commitment no doubt makes both ArianeSpace and the Russian builders of Soyuz very happy.  Elon Musk, CEO of SpaceX and working on a 4,000 satellite LEO communications network of his own is probably annoyed.

It isn't clear how European industrial policy has aided OneWeb in the background, but don't be surprised if French export money appears given the large commitments to Airbus and ArianeSpace.   OneWeb estimates that it will take around $2 billion to complete the first phase of its network.

No surprise that Virgin Galactic has a commitment in hand for 39 LauncherOne missions.  Since Virgin Group is a sponsor of OneWeb, LauncherOne gets a quid pro quo and anchor customer.  This commitment starts the clock when LauncherOne is available; the air-launched rocket has yet to be tested, let alone flown a paying customer.

But the real deal making here is in the announcement of established communications providers involved, both services and hardware.   Bharti Enterprises of India had revenues of $16.5 billion and includes the third largest mobile operator in the world, with a presence in 20 countries.  Totalplay operates a combination of broadband across Mexico, so OneWeb will provide a wireless option that can be deployed both within the country and throughout Latin America. 

Intelsat has established a "strategic alliance" by investing $25 million in OneWeb, enabling it to help develop hybrid access terminals that would work both with OneWeb's LEO network and Intelsat GEO satellites.  The OneWeb network would complement Intelsat coverage, which doesn't exist over the Earth's poles and has trouble in city "urban canyons" full of high-rises.  Intelsat will have an exclusive for OneWeb service distribution into aeronautical and maritime verticals, "certain" U.S. government and oil and gas applications, plus "certain exclusive" distribution rights for connected car and rail applications.

Hughes, a division of Echostar, gets to design, develop, and manufacture the ground system, as well as to market service to its global base of customers and distribution partners.  Presumably Hughes will be a large manufacturer of ground terminals, so this could be a big win if OneWeb manages to meet expectations on price and services.

Finally, stop and think about this:  The Coca-Cola company is underwriting satellite broadband to unserved areas.

Coke hasn't said how much it is putting into OneWeb, but it is already promoting business development around the world through efforts such as its EKOCENTER women's entrepreneur program.  One of EKCOCENTER's features is to deliver Internet access; OneWeb would slot right into its technology and business model. 



Contributing Editor

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