OneWeb’s bankruptcy follows the demise of LeoSat, creating more fodder for debate on the topic of building successful business models around Low-Earth Orbit (LEO) constellations.
Via Satellite spoke to Tom Choi, executive chairman of Airspace Internet Exchange and former Satellite Executive of the Year winner about his thoughts on the fate of OneWeb. Choi coins a new term — NOOBS: New Opportunities in Old Bad Space.
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VIA SATELLITE: What is your reaction to the OneWeb news?
Choi: I am surprised. OneWeb was backed by Softbank one of the most successful investors in the internet and telecommunications sector. I believe there is an interesting twist to this story however and I don’t believe we have seen the last chapter on OneWeb.
VIA SATELLITE: What does this say about the current state of the satellite industry?
Choi: I have been the most vocal opponent of OneWeb since the original announcement. My opposition was based on technical, regulatory, and logistical reasons. LEO broadband is extremely difficult to implement. Since 2009 there have been over $20 billion in new investments into New Space. History is indeed repeating and once again we see that managing lots of money doesn’t give you any extra IQ points.
LEO broadband is a bad idea whose time came and went over 20 years ago. Today you can build affordable GEO (High Throughput Satellites) HTS at one-tenth the capacity cost vs. LEO broadband. Just what problem are they solving?
VIA SATELLITE: Do you think there is any chance a buyer emerges for OneWeb?
Choi: Perhaps OneWeb might be gone but will its replacement re-emerge as SoftbankWeb? Only time will tell.
VIA SATELLITE: What are your final thoughts on the OneWeb news?
Choi: OneWeb’s failure will be very negative for the NewSpace industry. It will drive away many VC investors and LPs that are supporting them. If a project that raised close to $3 billion and was supported by one of the savviest and richest investors in the world cannot succeed, how will others?
In all seriousness, it will also negatively affect GEO FSS because investors are not experts so they may lump all the ‘space’ investments as duds. Immediately after Teledesic, Iridium, Globalstar, ICO, and others went under 20 years ago, there was almost no appetite or investor interest in new satellite projects.
Just like our nimble and smart ancestors that emerged out of the destruction of the dinosaurs, I boldly predict a new era will emerge — projects that are not rehash of old bad ideas. I can’t wait until the coming dawn of “Smart Space.” VS
