TIM FURNISS / LONDON
Winning concessionaire could generate revenues of €500 million a year by 2020
Four consortia have submitted bids to deploy and operate the European Galileo navigation satellite system. Bidding teams are led by Eutelsat (with AENA, Hispasat and Logica), EADS Space (with Inmarsat and Thales), Finmeccanica(with Alcatel) and OHB. The Galileo oversight body will pick a shortlist in February and a winner by the end of 2004.
The Galileo concessionaire will be responsible for managing the deployment phase from 2006 to 2007, and the operations phase from 2008. The €2.15 billion ($2.6 billion) cost of launching 30 satellites and establishing two control centres is intended to be largely recovered from operating revenues.
The Galileo Joint Undertaking established by the European Commission and European Space Agency plans to shortlist two or three bidders for negotiations on the concession contract in February.
The Galileo Joint Undertaking has responsibility for the €1.25 billion development and validation phase, with ESA responsible for the late 2005 launch of an experimental satellite to test the technologies in orbit. The concessionaire is expected to take the lead in arranging private financing of the deployment and operational phases, which will depend on revenue guarantees from European governments, Thales says.
The system is expected to cost €220 million a year to run. A PricewaterhouseCoopers study estimated the system could generate revenues from at least €60 million in 2010 to more than €500 million in 2020. The concessionaire is expected to achieve positive operating income by 2011 at the latest.
Source: Flight International
