Europe has decided to seriously engage in satellite connectivity. According to sources close to the operation, Airbus, Thales, and Leonardo have reached an agreement to merge their satellite divisions into a new conglomerate based in France. The clear goal is: to compete toe-to-toe with Starlink—the SpaceX constellation—and reduce dependence on private or extracommunity infrastructures in an area already critical for the continent’s economy, security, and strategic autonomy.
These are ambitious numbers: the resulting group would employ about 25,000 people and generate approximately 6.5 billion euros annually in revenue, according to preliminary estimates shared by the companies during negotiations. The ownership split reflects a deliberate effort to balance industrial and political considerations: Airbus would control 35%, while Thales and Leonardo would share the remaining equally, each with 32.5%. It’s not just mathematics: it’s a message to the European Union—and to markets—about shared governance and a commitment to a common project.
An ambitious timeline and a greater ambition
The timeline is demanding. If everything proceeds as planned, the new company will be operational by 2027, encompassing both satellite manufacturing and services for communications, defense, and Earth observation. Before that, the agreement must get approval from the governments of France, Italy, the United Kingdom, and Germany, in addition to passing the European competition regulators‘ scrutiny. In other words: there is administrative and political ground to cover. However, based on current progress, the strategic decision appears to be made.
The underlying motivation goes beyond the telecom market. Europe seeks satellite sovereignty. In recent years, the continent has seen broadband satellite connectivity become a neural infrastructure for businesses, administrations, and citizens. Meanwhile, the deployment capacity and scale of the United States—exemplified by Starlink—have opened a growing technological gap in LEO (Low Earth Orbit) constellations, user terminals, and network management. The numbers speak volumes: Starlink now exceeds 6,000 satellites, and continues to expand at a steady pace thanks to SpaceX’s industrial and launch muscle. For European manufacturers and operators, the challenge is not theoretical: it’s operational and commercial, here and now.
What exactly does the new group aim to achieve?
Beyond the “anti-Starlink” headline, the fusion pursues three tactical goals:
- Achieve industrial scale: integrate supply chains, design and production capabilities, and standardize platforms to reduce unit costs and accelerate manufacturing cycles.
- Align R&D and portfolio: prevent overlaps between product lines and redundant development, opting for common architectures across GEO, MEO, and LEO platforms, including payloads (secure communications, optical links, high-resolution Earth observation).
- Go beyond hardware: strengthen service capacity (ground segment, orchestration, cybersecurity, software-defined networks) and sell comprehensive solutions, not just satellites.
On the regulatory front, such a sizeable consolidation is not trivial. Brussels will scrutinize effective competition in segments with few players, as well as conditions for institutional and commercial clients. From a geopolitical perspective, however, the argument for strategic autonomy weighs heavily: space has explicitly entered the agenda of European industrial sovereignty.
Advantages and risks of a European “Champions League”
The main advantage is obvious: critical mass. The three groups have decades of experience manufacturing satellites for communications, Earth observation, and navigation, serving Europe and beyond. Together, they can optimize platforms, share cross-cutting technology (electric propulsion, inter-satellite laser links, onboard processing, reconfigurable antennas), and accelerate prototoype-to-production timelines. Additionally, an integrated offering enhances price and service competitiveness in international tenders and eases meeting European institutional program requirements.
The risk is also present: integration. Merging three distinct industrial cultures, with governments and contractors often pursuing their own agendas, demands fine governance. The 2027 plan requires aligning roadmaps by 2025–2026: deciding where to manufacture what, which lines to consolidate, which projects to continue or shelve, and how to craft a P&L structure satisfying all shareholders. Without such concrete alignment, the slogan of sovereignty might stay just rhetoric.
Starlink as a mirror (and as a benchmark)
The scale and speed of Starlink have reshaped industry standards. It’s not only about having thousands of satellites but about manufacturing and launching at a pace that drastically lowers the cost per bit, operating with software that optimizes routes and resources in real time, and marketing tailored services (home, mobility, maritime, defense) with increasingly simple and powerful terminals. The comparison is uncomfortable but necessary: if Europe wants to compete, it must produce faster and cheaper and close the gap in network management, user terminals, and service ecosystems.
The new conglomerate is precisely created with that mission: capture economies of scale and shift gears in an industry accustomed to short series and long lead times. The union of Airbus, Thales, and Leonardo offers the only lever capable of closing that gap within a reasonable timeframe.
Sovereignty is not isolation: alliances and markets
Sovereignty does not mean autarchy. Europe aspires to decide on its connectivity, not to build walls around talent, investment, or international collaboration. Accordingly, the new company must navigate alliances with European and non-European commercial operators, launch providers, and hyper-scalers demanding more satellite capacity for backbone and edge networks. The key is avoiding dependencies that threaten control over critical infrastructure, while maximizing interoperability and market openness.
Questions that remain (the crucial ones)
- Approvals and governance: the leading governments and the European Commission must validate the merger. Will there be conditions on facilities, employment, and markets? How will competitive neutrality be safeguarded in public programs?
- Technological roadmap: what LEO architecture, constellation size, and deployment timeline are envisioned? How will reconfigurable payloads and next-gen optical links be integrated?
- Costs and funding: what capex is required for moving to series production and automated supply chains? What role will European connectivity programs play, and how much will come from commercial clients?
- Terminals and segmentation: Starlink’s advantage isn’t just in space; it’s in the terminals and their industrialization. How does Europe plan to compete in this layer with an ecosystem that’s still dispersed?
A move that reshapes the European playing field
Europe needs a strong satellite network for three reasons: digital economy (ubiquitous, resilient, low-latency connectivity), security and defense (sovereign communications, navigation, observation), and crisis management (from wildfires to blackouts or large-scale cyber incidents). The announced industrial union—if it proceeds as planned—is a bold country-continent bet on occupying a space that is currently dominated by others. It does not guarantee victory but raises the bar and recovers ambition.
The ultimate test of execution remains: turning the manifesto into production lines, the headline into standardized platforms, and the idea into real services with SLAs and prices accepted by the market. On time and with momentum.
Will it be enough? The answer depends on two factors: coherence—avoiding the “logo sum” temptation and prioritizing common platforms—and speed—Europe’s ability to shorten the design, production, deployment cycle so that 2027 doesn’t slip to 2029. Meanwhile, Starlink keeps launching and reducing costs, making the decision to move now even more critical.
Frequently Asked Questions
What does “satellite sovereignty” mean for the European Union?
It entails controlling technology and operations of critical space infrastructure (secure communications, Earth observation, navigation), reducing dependencies on external vendors or jurisdictions, and ensuring service continuity amid geopolitical tensions or crises.
How will this merger impact European employment and supply chains?
Initial estimates point to 25,000 jobs and an enhanced industrial scale that could consolidate factories and automate lines. The final impact will depend on the integration roadmap, regulatory conditions, and ability to secure contracts.
Can Europe compete with Starlink if it starts late?
Only through scale, standardization, and speed. The merger aims to cut costs and speed up production, but closing the gap in user terminals, network software, and tailored services for different verticals (residential, mobility, defense) is also essential.
When might the impact be seen in commercial services?
The plan aims for operations by 2027, pending approvals and effective integration. In the short term, expect portfolio consolidation and RD alignment; deploying a competitive LEO constellation will additionally require financing, launch capacity, and spectrum agreements.
Sources: Information shared by involved companies and international agency reports on the merger status; publicly available data on Starlink and the satellite industry context.
via: elchapuzasinformatico and reuters