The likeliest purchaser of the bankrupt OneWeb broadband satellite venture isn’t Amazon, but a consortium backed by the British government. That’s according to satellite industry watchers cited by Space Intel Report and The Financial Times.
Amazon, which is working on its own Project Kuiper satellite constellation, was said to be among the entities that expressed interest in bidding on OneWeb’s assets after the London-based satellite concern declared Chapter 11 bankruptcy in March. OneWeb said the market disruption caused by the coronavirus pandemic spoiled arrangements to win further financial support from SoftBank group, one of its biggest backers, forcing the move to seek financial protection.
OneWeb’s assets were put up for sale under the supervision of U.S. bankruptcy court in New York. Bids were due to be opened today for an initial round of assessment. If there’s no clear winner in the eyes of the judge and OneWeb’s creditors, an auction would be held on July 2.
The Financial Times quoted its sources as saying the British government was willing to put up about $617 million (£500 million) as part of a wider private-sector consortium bid. If the bid is successful, the government could end up owning more than 20% of OneWeb, according to The Financial Times.
One of the reported sweeteners is that global positioning systems optimized for low Earth orbit could be added to the second-generation OneWeb satellites. That would give Britain its own GPS-like satellite constellation — making up for the anticipated loss of access to the European Union’s Galileo navigation system due to Brexit.
Several Chinese ventures were said to be planning bids for OneWeb’s assets, but Space Intel Report said the U.S. government signaled that it would raise regulatory roadblocks to any Chinese purchase. The federal government has significant say over how the sale proceeds, because under international export regulations, it would have to approve any international sale involving OneWeb’s U.S. assets, such as the venture’s satellite factory in Florida.
OneWeb’s biggest creditor is Airbus, the European consortium that’s a key partner in the satellite manufacturing operation. Today Airbus issued a statement saying it supported a bid involving the British government:
“The reported support of the UK government for a bid for OneWeb looks positive to support UK’s ambition to continue to be a leading player in space. As an original investor, and the manufacturer, in OneWeb, Airbus is pleased that a way forward looks likely. Airbus is the leading space manufacturer in the UK, pioneering many leading satellite technologies.
“The OneWeb constellation could help address the UK’s future space requirements and with innovative thinking should further enhance the UK’s place at the forefront of satellite technology and applications. Airbus and the wider UK space ecosystem have the skills to build future capability and then drive export opportunities. We would look forward to supporting OneWeb in the next phase of their business and growing the UK contribution to this market changing business.”
OneWeb has already launched 74 satellites for a constellation that’s expected to number around 650 satellites. Before filing for bankruptcy, OneWeb had expected to begin offering limited broadband internet service in the Arctic as early as this year. But it will take dozens more launches and billions of dollars of additional investment to complete the constellation and move ahead with the second-generation satellites.
Several other satellite ventures are targeting the market to provide broadband internet access from low Earth orbit to the billions of people around the world who are currently underserved. SpaceX has already launched 550 satellites for its Starlink satellite network, and is getting set to launch 57 more. (Today’s launch attempt was called off to provide more time for pre-launch checkouts, SpaceX said.)
Telesat, Canada’s biggest satellite operator, is also working on deploying a broadband constellation — with Blue Origin, Amazon CEO Jeff Bezos’ space venture, tapped to provide future launches. And speaking of Amazon, the Seattle-based retail and cloud-computing giant is working to get the regulatory go-ahead for its Project Kuiper constellation.
Some had speculated that Amazon might have been able to leverage OneWeb’s assets, including its licenses, for Project Kuiper’s benefit — but the hardware and the licenses aren’t a perfect fit for Kuiper’s planned specifications.
Amazon is getting a 219,000-square-foot facility ready for the Kuiper team in Redmond, Wash., and has posted more than 100 job offerings in Washington state, Texas, California and Virginia. One of the recent job postings is looking for a senior public policy manager to deal with domestic regulatory matters.
More from GeekWire:
- British-Indian team puts in a winning $1B bid for OneWeb satellite broadband venture
- Report: Amazon joins other satellite constellation ventures in checking out bankrupt OneWeb’s assets
- OneWeb’s first satellites are launched into orbit for global internet constellation
- Amazon reportedly registers interest in bankrupt OneWeb’s broadband satellite constellation assets