Peter B. de Selding
April 18, 2016
PARIS — Start-up Internet satellite constellation operator OneWeb LLC will build most of its 900-satellite constellation in a new factory in Exploration Park, Florida, following a co-funding agreement with the state of Florida, industry officials said.
The long-expected announcement was to be confirmed April 19 at a ceremony attended by OneWeb officials and Florida Gov. Rick Scott, officials said.
The creation of the Florida manufacturing plant adds another piece to the OneWeb puzzle, but at least two more-important decisions are expected from the company this year.
The first is fundraising beyond the $500 million in mainly supplier-provided equity announced in June 2015.
Just as crucial, industry observers have said, will be OneWeb’s selection of user-terminal builders. Terminal design and cost issues have stymied Internet satellite constellations in the past. OneWeb’s target market, in less-developed countries, makes it even more important that the user hardware be inexpensive, easy to install and rugged.
Along the way, OneWeb will confront the laborious task of securing landing rights in countries such as India and China, where regulatory issues have slowed other broadband projects.
OneWeb officials have said the Florida locale, near the Kennedy Space Center, benefits from the presence of a half-dozen other aerospace companies with manufacturing operations in the vicinity, creating a pool of technical talent.
Space Florida, which is Florida’s aerospace economic development agency, in January agreed to back an unidentified project, which industry officials confirmed was in fact OneWeb Satellites, a 50-50 joint venture between OneWeb LLC and Airbus.
Under the plan agreed to by Space Florida, the company will invest about $80 million in its manufacturing facility, including $36 million in the plant itself. The plant will qualify for $17.5 million in matching funds from the Florida Department of Transportation for the construction phase.
OneWeb Satellites has said it expects around 250 jobs to be created at the peak production run for the OneWeb constellation. The company is building about 900 satellites, including spares. The orbital constellation consists of 720 satellites – 40 spacecraft in each of the 18 orbital plans, all at 1,100 kilometers in altitude.
OneWeb and Airbus have said their partnership aims at producing each 150-kilogram OneWeb spacecraft for $500,000 or less once the facility is a full production cadence.
For OneWeb Satellites and for the state of Florida, the long-term success of the facility will hinge on whether the company is able to sustain a business by building satellites for other companies beyond OneWeb.
OneWeb LLC, based in Britain’s Channel Islands, in June 2015 raised $500 million from a group of investors including OneWeb satellite prime contractor Airbus Defence and Space, ground hardware component providers Hughes Network Systems and Qualcomm and satellite fleet operator Intelsat.
Two prospective customers — Bharti Enterprises of India and Grupo Salinas’s Totalplay Telecommunications of Mexico — also invested in OneWeb equity.
For the moment, OneWeb is lacking financial investors. OneWeb also has yet to announce agreements with the French export-credit agency, Coface, for low-cost, government-guaranteed financing.
The first 10 OneWeb satellites will be built at Airbus’s Toulouse, France, facility. Most of the constellation will be launched aboard Russian Soyuz rockets, with the launch operations managed by Arianespace of Evry, France. The first 10-satellite launch is scheduled for late 2017 or early 2018, with the full constellation in orbit by the end of 2019.
OneWeb and Arianespace in June 2015 signed what Arianespace has described as a firm, fixed-price contract valued at more than $1 billion for 21 Soyuz launches. The contract includes options for five additional Soyuz campaigns and three launches aboard Europe’s Ariane 6 rocket, set to debut operations in 2020.
OneWeb has also contracted with Virgin Galactic of Long Beach, California, to launch replacement satellites aboard Virgin Galactic’s LauncherOne rocket.
How much of OneWeb’s capital investment could be guaranteed by Coface has been a subject of debate in France and may depend on how much French content is installed on OneWeb satellite beyond the contribution of Airbus as prime contractor.
Whether backing from Coface’s U.S. counterpart, the U.S. Export-Import Bank, will be available to OneWeb is unclear. The bank has been awaiting confirmation of a new director for several months. Until the position is filled, the bank is unable to approve large-scale commitments.