Satellite Internet: Eutelsat buys Oneweb

The satellite Internet market is becoming increasingly interesting for many companies. So far, however, it has been mainly U.S. companies such as Amazon and Starlink that have been able to use satellites to provide Internet access even in remote regions of the world. Now, Eutelsat seems to be taking up a position as a European counterpart. The purchase of Oneweb is expected to create the first European satellite Internet.

Competition for Starlink and Amazon Project Kuiper

When one thinks of satellite Internet, the first thing that jumps to many people’s minds is Starlink, the offering from tech visionary Elon Musk. But Amazon, with its Project Kuiper, also wants to send 3300 Internet satellites into orbit soon. Despite their market power, however, the two providers by no means hold sway over the satellite Internet industry. In Europe in particular, it is apparently difficult for U.S. providers to gain a foothold. This is made clear, among other things, by a court ruling in France that stopped Starlink in that country for the time being.

Things could be different with European companies. Eutelsat also seems to be aware of this. With faith in the future of satellite Internet, the French telecommunications expert now apparently has merger intentions with Oneweb. Within the framework of a share swap, Eutelsat is to gain market power and thus be able to arm itself against the renowned competition from the USA. That Eutelsat has a merger interest in British company Oneweb emerges from a report by news portal Reuters.

Oneweb was on the verge of insolvency

If the merger between Eutelsat and Oneweb works out, it would be a real success story. This is true not only for European satellite Internet, but even more so for Oneweb. After all, the company, which was founded in India, was still on the verge of insolvency in 2020. Then the UK government decided to take over the satellite company. Now, two years later, Oneweb has an enterprise value of $3.4 billion. The fact that Oneweb is by no means a stranger to Eutelsat becomes clear just by looking at its shares. The French company already holds about a quarter of the shares in Oneweb. Eutelsat bought these a good year ago at a price of $550 million.

Eutelsat is not only active in Europe with satellite Internet

With purchase of Oneweb, however, Eutelsat does not enter the business of satellite Internet. Quite the opposite. Already, the company has a total of 36 satellites in operation, providing Internet not only to European countries. Areas in Africa and the Middle East are also supplied with European satellite Internet. Given the sheer mass of Starlink and Amazon’s Project Kuiper, however, that’s just peanuts. With the 430 satellites that Oneweb currently operates in orbit, however, the number on Eutelsat’s side is likely to increase substantially. Oneweb’s satellite fleet is expected to grow to 650 in the near future, which would make the total number at Eutelsat skyrocket.