TAMPA, Fla. — A shrinking broadcast business led to a different drop in revenues for Eutelsat because the French satellite operator edges closer to merging with OneWeb, the low Earth orbit (LEO) constellation set to spice up its shift into connectivity services.
Eutelsat posted 272 million euros ($295 million) in total revenues for the three months ended March 31, down 7.5% year-on-year when adjusted for currency changes on a like-for-like basis.
Broadcast sales fell 10.6% to 157 million euros as sanctions against Russian and Iranian channels added more challenges in a step by step declining satellite TV market.
Revenues for its smaller government services business also fell 13.4% to 31 million euros, which Eutelsat said was partly as a consequence of a decline in U.S. Department of Defense contract renewals that it expects to enhance later this yr.
Nonetheless, fixed broadband and mobile connectivity sales climbed 7.3% and 23% to 18.5 million euros and 26.9 million euros, respectively, sustaining positive momentum ahead of two recent high throughput geostationary satellites set to enter service within the second half of 2023.
OneWeb update
Eutelsat has been investing heavily in connectivity services as a part of a growth strategy that saw it announce plans last yr to merge its geostationary network with U.K.-based OneWeb’s LEO constellation.
The merger is on target to finish this summer, Eutelsat CEO Eva Berneke said during a May 11 earnings call with analysts, pending regulatory approvals and a shareholder vote.
The business arm of India’s space agency launched the ultimate batch of satellites OneWeb needs to supply business broadband services globally in March, which Berneke said fully de-risked the project.
She said 22 ground network portals had been for the constellation, and one other 18 are on target to be installed by the tip of this yr to enable global business services by January 2024.
OneWeb’s network currently represents around 450 gigabits per second (Gbps) of capability, mainly limited to the upper region of the northern hemisphere, and is slated to achieve 1,300 Gbps after bringing global coverage online.
While Eutelsat expects OneWeb to have generated only $50 million in revenues for the 12 months to June 30, Berneke said the LEO operator has an order backlog of $900 million — up $300 million from October.
OneWeb has signed deals with 53 distributor partners up to now and is looking for to expand this to 75 this yr.
In accordance with Berneke, the LEO operator could also help Eutelsat play a job in IRIS², Europe’s proposed multi-orbit broadband constellation also generally known as Infrastructure for Resilience, Interconnectivity and Security by Satellite.
Eutelsat announced May 2 it had partnered with other established space firms to jointly bid to develop the 6 billion euro ($6.6 billion) project.
The British government will proceed to carry priority voting rights in OneWeb following the Eutelsat merger, complicating its plan to hitch Europe’s sovereign network post-Brexit.
Nonetheless, Berneke said their merger deal features a clause enabling Eutelsat to carve British government control out of an element of OneWeb’s second-generation constellation.
Work is about to start next yr on OneWeb Gen 2, which Berneke said would have three to 5 times more capability than Gen 1 and use fewer but bulkier satellites.
By leveraging the French operator’s geostationary network in high-demand areas, Eutelsat expects Gen 2 can be a constellation of around 300 satellites, greater than half the variety of 150-kilogram satellites in OneWeb’s Gen 1 system.