Another consumer-grade, Low-Earth Orbit (LEO) satellite constellation designed to connect billions of unconnected people has slipped through our fingers. This time, it wasn’t a scrappy underdog story, or a brilliant concept on paper, or a garage-stored prototype.
After building a shack and mounting an antenna on it in less than 12 minutes on stage at SATELLITE 2015, Greg Wyler launched OneWeb into our industry’s consciousness. In what seemed like a matter of minutes, he raised close to $3 billion from a consortium led by SoftBank and including big brand names like Airbus, Coca-Cola, Qualcomm and Intelsat. Today, OneWeb is floating on just enough SoftBank cash to carry it through an asset sale this summer.
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Did the coronavirus singlehandedly bring down OneWeb? No, but it provided adequate cover. At a second glance in hindsight, the red flags start to become a little clearer.
The most vocal critics of the constellation business model base their argument around the very simple fact that it costs too much money to make money. OneWeb seemed to have the money in place to overcome half of these challenges, but some of the technological and business-related challenges required partnerships. OneWeb landed a solid space systems manufacturing partner with Airbus, yet struggled to find the same kind of relationship with a ground systems partner.
Another warning sign may have been the rocky relationship with Intelsat. The two companies lived through their own dramatic trilogy. Intelsat put up $25 million as part of the original consortium. Not long after, Intelsat bondholders prevented a merger that could have been worth $13 billion. This eventually led to lawsuits.
One could also question OneWeb’s leadership and whether or not the operator could have benefited from Greg Wyler’s sustained presence. After the initial investment consortium was announced, Wyler seemed to slowly fade into the background.
Last, but certainly not least – signs of trouble at SoftBank started to become quite clear when investors raised alarm about losses in its Vision Fund.
I feel a genuine sense of excitement whenever these constellations leap from blueprint to launch-pad. I was genuinely excited for OneWeb, and the accomplishments of its incredibly talented staff. I hope that whoever acquires the remains of OneWeb will be able to put both the existing satellites and the people who spent their workweeks trying to realize Greg Wyler’s vision back to work. VS
