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Europe: Satellite wars

01 May 2005

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The German government has threatened to use "all peaceful means" (transport minister Stolpe) to stop France gaining control over Europe's £2 billion Galileo satellite program. Galileo is designed to break the strategic dependence from America's GPS (Global Positioning System). With 30 satellites in orbit by the end of the decade the network will offer pinpoint accuracy for mobile telephones, air traffic control, maritime navigation and "other uses" - ultimately including EU defence. Berlin was backing a bid by iNavSat, a consortium of the EADS aerospace group, Britain's Inmarsat and France's Thales defence group. France was pushing for a joint venture combining iNavSat with Eurely, made up of France's Alcatel, Italy's Finmeccanica, and Spain's Hispasat. The first combination has a strong German element, the second would have made France the dominant player. In the end the Galileo Joint Undertaking, the body set up to drive the project's early phases, settled on a combined bid from the two groups. The final contract will give the companies the right to operate Galileo for 20 years.

The start-up costs are partly funded by the European Commission and the European Space Agency. The Commission claims that Galileo will generate £7 billion in annual business from 2008, creating up to 150,000 jobs. Although the US offers GPS free to civilian users worldwide, Brussels insists that Galileo is more accurate and also warns that GPS can be switched off by the Pentagon at any time for national security reasons.

China is investing £140 million in Galileo to the alarm of Washington. South Korea and Israel have also signed up.

Telegraph 24.5.05 (Ambrose Evans-Pritchard); BBC News 27.6.05

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