OneWeb has inked a deal with BT to provide low-orbit satellite connectivity across BT Group, with the first live trials due to start early 2022.

The new distribution partner agreement represents "an important step" towards harnessing space's potential for BT customers, said BT Group CEO Philip Jansen. Satellites will now "be an important part of our plans to expand connectivity throughout the UK and globally," he added.

Figure 1: Take off: OneWeb has inked a deal with BT to provide low-orbit satellite connectivity across BT Group, with the first live trials due to start early 2022.
(Source: Roscosmos, Space-Center-Vostochny and TsENKi)

While you might think BT represents a prize customer for OneWeb, it actually was Jansen's company this morning lauding the deal as a "landmark agreement" and "industry-first global partnership," in its statement.

As the pas de deux kicks off, BT's Bristol lab will be testing capabilities to show how low-Earth orbit services can integrate with the group's existing terrestrial ones. These initial trials will focus mainly on satellites' role as a supplementary, low-latency backhaul when additional capacity or a backup solution is needed for resilience purposes.

This is in view of the current capacity levels of the OneWeb constellation – with the company aiming to deliver North Pole-to-50th parallel coverage, including the United Kingdom, by later this year, and global coverage by next June.

But tests on internet of things and rural fixed wireless access may also fit in the mix, too, as the OneWeb constellation's capacity grows.

And with UK government ministers taking the lead alongside India's Bharti Group to rescue the satellite company in November 2020, after the deal the government backslapping in Westminster was "audible from space", quipped telecoms journalist Nick Wood.

The UK's business secretary Kwasi Kwarteng waxed rhapsodic, saying the rescue was "a crucial part of our plans to cement our status as a global science and technology superpower."

OneWeb, One Life

Still, altogether it has been a good year so far for OneWeb.

Neil Masterson's satellite company received a $400 million investment in January from SoftBank and Hughes Network Group. This was then followed up in April by Eutselsat taking a quarter stake.

And as opposed to Elon Musk's Starlink, OneWeb isn't targeting consumers, but governments and telecoms companies instead.

With some luck, it looks like. OneWeb has also announced this week a $200 million joint venture with Saudi Arabia, to provide the connectivity for a planned new "smart city" in the country's northwest, backed by the country's sovereign wealth fund.

Another new tie-up is to offer low-Earth orbit connectivity to the US Department of Defense, together with the defense contractor Leonardo DRS. (Leonardo is based in Arlington, Virginia, but was bought by Italian owners in 2008.)

This deal will benefit just about everything the US military touches, according to the companies: "DoD naval and maritime systems, ground combat mission command and network computing, global satellite communications and network infrastructure, avionics systems, and intelligence and security solutions," according to their statement.

BT prepares a bundle for Thursday's earnings

BT meanwhile announced its cost-cutting plans were ahead of schedule, with £1 billion trimmed from the group's expenses well in advance of its March 2023 target. This cost-cutting likely will involve adding to the 13,000 jobs the company already has said it would cut.

The announcement led to speculation that BT is circling its wagons against a takeover attempt by France's telecoms tycoon Patrick Drahi.

BT's share price has been on a downward slope since the middle of the year. And whether sensing a bargain or perhaps a base for something more, Drahi purchased a 12% stake in BT in June for £2 billion.

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Jansen's group meanwhile has been looking for an outside investor for a joint venture with Openreach, as it vows to "build like fury" in its plans to spend £15 billion to upgrade 25 million homes and businesses to fiber broadband by the end of 2026.

But at least as it readies itself for investors' hard stare when it releases its earnings on Thursday, BT now has one area stored up where its fortunes are currently sky high.

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— Pádraig Belton, contributing editor special to Light Reading