Satellite companies OneWeb and Eutelsat have agreed to a $3.4 billion merger to create a global internet connectivity player competing with SpaceX’s Starlink and Amazon’s Kuiper. Combined, the two companies say they will connect low-Earth satellites that offer faster connections with less delay and geostationary satellites that have more capacity and cover larger areas, with OneWeb continuing to operate as its own brand under Eutelsat.
France-based Eutelsat provides television and internet via 36 satellites in geostationary orbits around the equator. OneWeb, which launched its first internet broadcast satellites in early 2019, currently has about 428 satellites in orbit of the 648 it plans to have as part of its constellation and has so far closed deals aimed at acting as supplier for governments and other companies like AT&T.
Amazon’s low-Earth orbit satellite Internet company Project Kuiper has booked 83 launch flights over a five-year period to deliver its planned constellation of 3,236 satellites, but has yet to launch any. By comparison, SpaceX Starlink has already launched thousands of satellites, has more than 250,000 subscribers and currently offers high-speed Internet services in dozens of countries with multiple service options. For more information on the current state of the Internet via satellite, watch our video a description of the current state of affairs and the possible impact of satellite internet services.
“Bringing our two companies together will be a global first, combining LEO constellations and GEO assets to capture significant growth opportunities in connectivity and provide our customers with solutions to their needs in an even wider range of applications,” Eutelsat President Dominique D’ Hinnin said in a press release. “This combination will accelerate the commercialization of the OneWeb fleet while increasing the attractiveness of Eutelsat’s growth profile.”
OneWeb competed with SpaceX early on to provide internet to the Arctic. In March 2021, the company launched 36 satellites into space and announced in July from last year that it had completed its “Five to 50” mission to provide coverage from the North Pole to the 50th parallel. It aimed for global coverage by June this year, but planned launches from Russia were cut after the country invaded Ukraine. While Russia held the launches in an effort to extract OneWeb’s demands, the company was forced to switch to SpaceX as it wants to complete its constellation.
OneWeb’s current shareholders will receive a 50 percent stake in Eutelsat after the merger is completed, which could happen in the first half of 2023. The approval process also involves navigating the UK National Security and Investment Act to evaluate potential threats that the merger could pose to national security.