Intelsat & OneWeb Announce LEO Ku Sat Venture
Intelsat S.A. (NYSE: I), the world’s leading provider of satellite services, today announced that it has entered into a commercial agreement with OneWeb, the venture planning to build, deploy and operate a low earth orbit (“LEO”) Ku-band satellite constellation. Under the agreement, Intelsat will partner with OneWeb to use OneWeb’s LEO platform, once established, to complement Intelsat’s geostationary orbit (“GEO”) satellite services, resulting in the first and only fully global, pole-to-pole high throughput satellite system.
Complementing their commercial agreement, Intelsat announced that it will make a minority share investment of $25 million in OneWeb. The companies will also collaborate to develop hybrid LEO/GEO end-user access terminals, furthering Intelsat’s vision to lower the cost and accessibility of satellite-based broadband and unlock new markets for satellite broadband.
“As the world’s first and largest provider of commercial satellite services, Intelsat believes that the opportunity for space-based communications is at a new inflection point, especially as broadband connectivity has become an essential input to economic growth for individuals, businesses and communities,” said Intelsat CEO, Stephen Spengler. “In this context, we are accessing new technologies and leveraging sector innovations to the benefit of our customers and our network.
“Through this partnership with OneWeb, we will further differentiate our own GEO infrastructure, including our next generation Intelsat EpicNG high performance satellites that will begin to launch in the first quarter of 2016,” Spengler continued. “By complementing our GEO services with LEO services, we will be able to provide connectivity over the Earth’s poles and in urban canyons, coverage that is important for certain mobility applications, including automotive services. In collaborating on Ku-band access hardware, we will develop technologies with additional scale that will simplify access, reduce costs and open new addressable markets.”
“Intelsat’s endorsement of our technology and solution is key to driving our venture to the next phase of development. Our mission is to enable affordable Internet access for everyone,” said Greg Wyler, CEO and Founder of OneWeb. “While the primary goal is to bridge the digital divide for rural areas, we recognize the potential for a seamless Ku-band infrastructure to support other applications as well. The OneWeb and Intelsat alliance allows each company to leverage the strength of the other. We believe that access to Intelsat’s global service and technology footprint, and collaboration on solutions which combine the benefits of LEO and GEO, will advance our mission.”
Pursuant to the commercial agreement with Intelsat, OneWeb will develop its platform to provide seamless network interoperability with Intelsat’s global EpicNG GEO infrastructure and service offerings. This will enable OneWeb to coordinate the provision of services over the equatorial regions, where GEO services have spectral priority, overcoming a major operational hurdle to LEO platforms.
The agreement will also include a firm service commitment from Intelsat for OneWeb services upon commencement of operations, which is currently estimated for 2019. Intelsat’s service commitment is in exchange for exclusivity granted to Intelsat for distributing OneWeb’s services within the aeronautical and maritime sector verticals, and for certain U.S. government and oil and gas customer applications. The agreement also includes granting to Intelsat certain exclusive distribution rights for connected car and rail customer applications.
Industry consultant NSR forecasts over $7 billion of incremental revenue industry-wide through 2024 from demand for satellite-based broadband connectivity services for aircraft, ships, connected devices, cars and remote villages. These applications are currently, or planned to be, served by Intelsat’s global fleet of approximately 50 C-band and Ku-band GEO satellites. By combining GEO and LEO capabilities, Intelsat will be able to address specific requirements within the above applications. For example, the combination will allow Intelsat to extend its broadband mobility offerings to the polar cap regions, important to some aeronautical and maritime routes. In addition, Intelsat will be able to complement highly efficient GEO broadcast capabilities with the high elevation angle solutions of LEO services for situations where GEO signals might be blocked, such as in mobility applications in cityscapes. This would result in unmatched ubiquity for enabling software downloads to vehicles for the automotive industry. Development of mass market end-user hardware will further Intelsat’s strategy to deliver high performance, cost effective and simple access for customers, growing satellite’s share in the global telecommunications infrastructure. When fully deployed, OneWeb’s initial constellation of more than 600 LEO satellites will be the largest satellite constellation in orbit, providing approximately 10 terabits per second of low-latency, high-speed broadband to consumers around the globe.