UK-government backed OneWeb and US-based Intelsat are joining forces to offer inflight connectivity services to airlines, combining the former's low Earth orbit (LEO) satellite service with the latter's geo-stationary (GEO) satellites to "harness the power of multi-orbit capabilities."

The companies said they expect the multi-orbit solution to be in service by 2024. Inflight connectivity is certainly an increasingly crowded field, with companies such as Inmarsat, Eutelsat, SES and Viasat also engaged in the market. Intelsat itself has already acquired Gogo Commercial Aviation, which provides commercial inflight broadband and entertainment services.

Ben Griffin, OneWeb vice president, Mobility Services, hailed the announcement with Intelsat as a "watershed moment for the inflight connectivity market."

Figure 1: The two satellite companies will combine LEO and GEO services to offer service to airlines by 2024.
(Source: Roscosmos, Space-Center-Vostochny and TsENKi)

Jeff Sare, president of Intelsat's Commercial Aviation, opined that the hybrid service offering "further allows the global airline community to plan their suite of next-generation onboard services with confidence – not only ensuring a future-proofed passenger inflight connectivity experience, but also the implementation of a connected airline digitalization strategy."

Merger frenzy

Intelsat and OneWeb have previous history: in 2015, Intelsat engaged in a $500 million round of funding in the then satellite communications startup. Much has changed since that time, with both satellite providers subsequently filing for bankruptcy. OneWeb emerged from Chapter 11 bankruptcy in 2020, while Intelsat only formally emerged from its bankruptcy earlier in 2022.

In the meantime, the two partners are also apparently pursuing mergers with other companies.

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In July, OneWeb signed a Memorandum of Understanding with French satellite company Eutelsat to merge. The arrangement, billed as a merger of equals, will see Eutelsat – after issuing 230 million new shares to allow OneWeb shareholders to take a 50% stake in the French company – completely own the new, enlarged entity. The transaction values OneWeb at $3.4 billion.

In August, it was also reported that Luxemburg-headquartered SES and Intelsat are in talks about a potential merger deal. One unnamed source, apparently familiar with the matter, said "neither wants to be the last one standing" as consolidation fever grips the satellite sector.

In terms of other mergers in the sector, Viasat shareholders have also approved the proposed merger with Inmarsat. The transaction is expected to close before the year is out.

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— Anne Morris, contributing editor, special to Light Reading