Eutelsat is further distancing itself from the consumer broadband market as Starlink's expansion continues to impact demand for geostationary services. On February 14th, the French operator announced the repurposing of its Konnect VHTS satellite, launched in 2022, to cater to higher-paying mobility clients in various markets. This 500-gigabit-per-second satellite, initially intended for consumer broadband across Europe and Africa, will now primarily serve maritime and aviation sectors.
Eutelsat CEO Eva Berneke confirmed that key customers in Spain, Switzerland, and France are already utilizing Konnect VHTS connectivity, with only TIM (Italy) opting out of the transition. While not expecting to sell all capacity, Berneke stated, “we are developing terminals for also mobility use,” highlighting the shift towards specialized applications. This strategic move is a direct response to the growing competition from Starlink, which offers lower-latency services via its LEO network.
Berneke acknowledged Starlink's expansion beyond consumer broadband into enterprise and government sectors. Eutelsat's own transition towards connectivity began a decade ago as its video business declined. The acquisition of OneWeb in 2023, a LEO broadband operator specializing in enterprise and government, strengthens Eutelsat's position in this evolving landscape. The same year also saw the sale of Eutelsat's European retail broadband operations, focusing the company on wholesale services.
Eutelsat’s current fleet includes 35 geostationary satellites and 654 OneWeb LEO spacecraft. The GEO satellites are viewed as a key advantage over LEO-only providers like Starlink, offering redundancy and increased capacity in high-demand areas. Berneke suggested that Konnect VHTS could support OneWeb's aviation services. However, the company is carefully reviewing future GEO investments, reflecting the overall market shift towards LEO.
Capital expenditures are projected at €500-600 million for the fiscal year ending in June, €200 million lower than previous forecasts. This reduction is attributed to adjusted LEO investment timing and stricter GEO spending controls. Eutelsat plans to invest up to €2.2 billion to complete OneWeb's constellation (440 satellites), followed by the deployment of 264 satellites for the European Iris² network (around 2030). Funding for OneWeb's expansion involves collaboration with export credit agencies, following a recent order of 100 satellites from Airbus. Iris² will receive around €2 billion in investment, with significant spending planned for later project phases. The company anticipates generating at least €6.5 billion over a 12-year concession period, encompassing several hundred million euros in government-backed capacity commitments from EU members.
Currently, OneWeb remains Starlink's primary competitor, though Amazon and Telesat's LEO constellations are still under development. OneWeb faces delays in establishing global commercial services due to ground infrastructure limitations. Berneke stated, “We still have around five gateways to go in some of the complicated places like Tanzania and Senegal and Martinique,” with completion anticipated in the second half of the year. Regulatory hurdles are also impacting deployment in countries like India, where Starlink also awaits approval.
Despite Starlink's rapid market growth, Berneke emphasized the strong demand for alternative providers, citing geopolitical factors and the need for network resiliency. She mentioned a recent OneWeb contract with the Taiwanese government as an example of this trend, highlighting the importance of "non-U.S., non-Chinese alternatives." Eutelsat reported €606.2 million in total revenue for the six months ending in December, a 4.4% year-over-year increase (adjusted for exchange rates), driven by connectivity growth offsetting a decline in video sales.