OneWeb Is Out of Bankruptcy but Not Out of the Woods
OneWeb, which declared bankruptcy in May, has reorganized and emerged from bankruptcy. Bharti Global, an Indian telecommunication conglomerate, and the British government each own 42.2% of the new company, and most of the rest is owned by previous investors SoftBank and Hughes Network Systems.
Hughes will continue work on ground infrastructure and marketing and the original joint venture with Ai
rbus, which designs and manufactures OneWeb satellites, was re-activated and the production lines brought back into service.
The company has new top management. Neil Masterson, who was COO at Thomson Reuters, will be the new CEO at OneWeb and Sunil Bharti Mittal, Founder and Chairman of Bharti, will be the Executive Chairman. The previous CEO, Adrian Steckel, has been appointed Adviser to the Board. Notably, OneWeb founder and previous Executive Chairman Greg Wyler was not mentioned so may not be involved perhaps that is related to the shift from the end-user market to government, enterprise, maritime, aviation and other markets that may be less price-sensitive and not require low-cost terminals. (The first million terminals may be costing SpaceX as much as $2,400 each).
OneWeb has permission from the FCC to operate 2,000 satellites 720 in low-Earth orbit (LEO) at 1,200 km and 1,280 in medium-Earth orbits at 8,500 km and a 45 inclination. They currently have 74 LEO satellites in near-polar orbit and recently shipped 36 to Russia’s Vostochny Cosmodrome for a December 17th launch on a Soyuz rocket. (While they have permission to launch 720 LEO satellites, they seem to be only planning to launch 648).
OneWeb’s first priority is building out its first-generation broadband network and providing coverage down to about 50 degrees latitude next year and to complete the full constellation the following year. The plan is to begin commercial services starting at the end of 2021 to the UK, Alaska, Canada, Northern Europe, Greenland, Iceland, and the Arctic Seas.
The company is seeking landing rights in India and Mittal said they plan to begin testing Internet service there in 6-8 months. (Those will be test satellites with intermittent connectivity). The plan is to offer service in India in May/June 2022.
OneWeb is starting over with new partners, assets that had cost the previous company $3.3 billion, and priority spectrum rights, but they are not yet out of the woods.
For a start, they’ve booked sixteen launches with Arianespace but will need about $2-2.5 billion to complete the constellation.
They have also lost time. They had initially hoped to begin Alaskan service in 2019 and serve the entire state by the end of 2020, and are now far behind that schedule. In the meantime, Telesat, their stiffest competitor for Alaska and the polar region, has made steady progress.
While Bharti’s participation gives OneWeb an advantage in terms of distribution and business and government relationships in developing nations in Asia and Africa, they will face stiff Chinese competition in the “Digital Silk Road” nations.
They are also under time pressure to manufacture and launch satellites in order to retain their ITU spectrum rights 360 satellites by June 2023 and 720 by June 226. While OneWeb has maintained it’s manufacturing joint venture with Airbus, the BBC reports that “components exist for a further three batches of satellites, and the new owners have been busy in recent weeks re-establishing old supply chains to fully ramp up production to pre-bankruptcy levels.”
Other than Hughes and Airbus, I don’t know which of their prior contracts, MOUs, and relationships are still in force. For example,they had agreements for distribution and cooperation in Alaska, Hawaii, Russia, Armenia, Georgia, Kazakhstan, and surely others I am unaware of.
Finally, there has been discussion of the possibility of OneWeb generating revenue by modifying their satellites to double as a high-precision global navigation satellite system (GNSS) that is difficult to jam or spoof. Mittal told BBC News: “For Generation 2, we will of course have full-scale precise, navigation and timing. And if the UK government wants some other payloads critical to the needs of security, we will do whatever is required.” By the time they are ready to launch the next-generation satellites, they may face competition from Xona Space Systems’s forthcoming 300-satellite GNSS as well as the possibility of similar offerings by SpaceX.
I hope OneWeb survives and thrives billions of people live in unserved areas and competition is good for all. Written by Larry Press, Professor of Information Systems at California State UniversityFollow CircleID on TwitterMore under: Access Providers, Broadband, Telecom, Wireless
Author: Larry Press
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