Hughes ups its orders from OneWeb satellite project to $300m

Alan Burkitt-Gray
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OneWeb goes to Hughes Network Systems as SoftBank-backed low-orbit satellite project gets ready for first launches

SoftBank-backed satellite project OneWeb has signed a $190 million partnership deal with Hughes Network Systems to provide a ground network, taking Hughes’ total business with the project to $300 million.

OneWeb plans to start launching the first of hundreds of low-orbit satellites in May 2018. It will make them in a factory in Florida at the rate of 15 a week.

“The start of production of the ground system is a major step towards fulfilling OneWeb’s goal of bridging the digital divide, leaving no one behind,” said Greg Wyler, OneWeb’s founder and executive chairman, hinting that first US services will be in Alaska.

“Hughes has been an outstanding technology partner and we are excited to deploy this essential part of our network as we ramp up to launch the first of our fleet early next year and provide service to every rural home in Alaska starting in 2019.”

Hughes, like SoftBank, is an investor in OneWeb, and it already has a system development deal. The new contract puts the total value of both deals at “over $300 million”, said OneWeb.

John Corrigan, senior vice president of engineering for Hughes, said the company will be “designing a ground system capable of supporting hundreds of [low earth-orbit satellites] with seamless handoff of broadband traffic between satellites” and said that “presented a significant challenge”.

He added: “But our team was up to the task, and we are proud to be partnering with OneWeb on realising this revolutionary satellite communications system to close the global digital divide.”

Joint development of the ground network system began about two years ago. The current agreement includes equipment to support multiple satellite access points in gateway locations around the world, each including a custom switching complex, outdoor modems and power amplifiers. Shipments are expected to begin in mid-2018.

According to Wyler, speaking last month to the US Senate Committee on Commerce, Science, and Technology, OneWeb will bring “speeds of up to 2.5Gbps direct to homes around the world”.

The company already has a licence from the Federal Communications Commission (FCC) for US services, starting in Alaska in 2019, “and in the following year will reach every square mile of America and its territories, leaving no one behind”.

OneWeb has raised nearly $2 billion in equity from shareholders including Qualcomm, Hughes, Intelsat, Coca-Cola, Airbus, Virgin Group, and SoftBank. The investment could reach $30 billion, he told the senators.

A plan for Intelsat to merge with OneWeb collapsed in June 2017 because Intelsat’s bondholders – representing $14.5 billion of debt – failed to agree terms.