France is betting Eutelsat can become Europe's answer to Starlink — but experts aren't convinced

Eutelsat, the French satellite operator, has long aspired to present a European alternative to Elon Musk's Starlink satellite broadband service. In a strategic move to consolidate the continent's satellite communications industry, Eutelsat merged with British venture OneWeb in 2023. This merger aims to enhance Europe's competitiveness in the satellite sector, particularly as the French government recently invested 1.35 billion euros (approximately $1.58 billion) into Eutelsat, becoming the company's largest shareholder with a 30% stake. Despite this significant backing, experts are skeptical about Eutelsat's ability to rival Starlink, which boasts a sprawling constellation of over 7,000 satellites, compared to Eutelsat's much smaller fleet. The European space industry continues to lag behind the United States, where SpaceX dominates the launch service market. Currently, Eutelsat's market capitalization stands at 1.6 billion euros, a stark contrast to SpaceX's estimated value of $350 billion, as determined in a secondary share sale last year. Analyst Luke Kehoe from Ookla has noted that France's investment indicates a shift in perception, viewing Eutelsat more as a critical infrastructure provider than a typical telecommunications company. This move aligns with the European Union's ambition for technological self-sufficiency. However, building a competitive satellite internet provider will not be straightforward. Experts assert that to effectively challenge Starlink, Eutelsat would need to significantly expand its Low Earth Orbit (LEO) satellite fleet, which currently consists of about 650 satellites—far fewer than Starlink's. Joe Gardiner, a research analyst at CCS Insight, emphasized that Eutelsat must replace many aging OneWeb satellites before it can grow its constellation. Kehoe echoed this sentiment, stating that Eutelsat's ability to compete in the mass-market satellite broadband sector is limited, even with new capital. Although the company is positioned to serve European markets focusing on security and jurisdictional control, it still trails behind Starlink in critical areas such as funding, manufacturing capacity, launch access, and user terminal technology. French President Emmanuel Macron has been vocal about enhancing Europe's investment in the space sector, underscoring its importance in the context of global power dynamics. Eutelsat has highlighted its unique position as the only European operator with an active LEO network and its strategic role in France's defense and communications strategy. Earlier this year, Eutelsat was speculated to be a potential alternative for Starlink's services in Ukraine, where Starlink has been instrumental in supporting the military amid the ongoing conflict with Russia. Germany has installed 1,000 Eutelsat terminals in Ukraine to provide an alternative to Starlink's extensive network. However, former CEO Eva Berneke acknowledged the company's limitations in matching Starlink's scale, stating candidly that Eutelsat could not fulfill the entire connectivity needs of Ukraine. With a new CEO at the helm, Eutelsat aims to enhance its operations and develop a differentiated market strategy. Nonetheless, experts point out that Eutelsat's technical framework and satellite designs are fundamentally different from Starlink’s, which may hinder its competitiveness. As Eutelsat strives to innovate and expand, the road ahead remains fraught with challenges, but the company's ambitions reflect a significant step in Europe's quest for independence in satellite communications.