Jean-Hubert Lenotte, Eutelsat’s chief strategy officer. Photo: Eutelsat.

In the run-up to the SATELLITE 2018 Conference & Exhibition, Eutelsat has announced plans to launch its first satellite in Low Earth Orbit (LEO). Nanosatellite manufacturer Tyvak International, a subsidiary of Terran Orbital, will build the satellite. Eutelsat’s LEO for Objects (ELO) spacecraft will be used to assess the potential of LEO satellites in providing narrowband connectivity for objects. Jean-Hubert Lenotte, Eutelsat’s chief strategy officer, spoke to Via Satellite about the plans for the satellite, scheduled to launch in 2019, and how this could lead to Eutelsat looking to have a full constellation in LEO at some point in the future.

VIA SATELLITE: What is the significance of today’s announcement for Eutelsat? Why is the time right for Eutelsat to launch a LEO-based satellite?

Lenotte: The right timing has to be a combination of a business opportunity and a technology to address it. When it comes to choosing between Geosynchronous Earth Orbit (GEO), Medium Earth Orbit (MEO) or LEO, we are agnostic. We would actually use any of the orbits when we have the right business cases and right applications to justify the investment. The significance of today’s announcement is that it is a first step. We are targeting one specific application which is the Internet of Things (IOT) and we have chosen to use a LEO satellite because we think LEO will be well suited for such applications. Indeed IOT requires low bit rate connectivity and does not require a high concentration of capacity, meaning small satellites can be used. Therefore, we think there might be a business case for LEO in IOT. The purpose of the test is to see if it does work technically and meets certain customer requirements.

VIA SATELLITE: You mentioned it is a “first step.” It seems a very low-key entry into alternative orbits, especially when you consider what Telesat and others are doing. How do you respond to that?

Lenotte: Of course, it is the first satellite we will be launching in LEO and, as such, it is a milestone for us. But it is a satellite that will be used to perform tests, not to offer a commercial service. Before any commercial service launch, we will make sure that we have the right applications and business case to reach profitability.

VIA SATELLITE: Are you likely to launch more into LEO post-2019 if this satellite is a success? What are your capital expenditure plans regarding new satellites in LEO?

Lenotte: The satellite will be launched in the first half of 2019. Then we have a few months to perform all planned tests. If those tests are conclusive from a technical point of view, and the associated business model is profitable — this includes having the right partners for distribution — then it is likely we will follow up with a more ambitious project, possibly a constellation. This is not included in our capital expenditure plans, and if it happens would only apply as of our fiscal exercise 2021, thus with no impact on our guidance.

VIA SATELLITE: So, a LEO constellation is a possibility? This could definitely be part of the plan?

Lenotte: Yes, the next step could be a constellation in LEO dedicated to IOT. This is typically what we are looking to test. ELO will demonstrate the technical feasibility and in particular determine how many objects we can serve. The insights gathered will drive the design of a potential complete system.

VIA SATELLITE: Aside from the test, if we can talk theoretically, are you a big fan of LEO satellites and capabilities?

Lenotte: We are looking at each potential response for each specific application. For video, we only really see GEO satellites serving this market. For broadband, we don’t see today the potential opportunity for LEO satellites. If you look at today’s market in terms of LEO satellites and the associated infrastructure and equipment, such as the antennas, we don’t see the levels of maturity to justify investment and we still think GEO will be more effective than LEO to bring capacity just where it is needed, at the best cost. But for IOT, where you need less bandwidth and where you can order smaller satellites, we do see the potential here.

VIA SATELLITE: Is this the start of Eutelsat’s strategy in terms of non-GEO? How important will non-GEO for Eutelsat?

Lenotte: It is the first non-GEO satellite that we will be launching indeed, but it is too early to talk about a non-GEO strategy. For IOT, we think there might be an opportunity for LEO. But for other applications, GEO satellites in their current maturity are best adapted for these applications. That said, technology and costs will continue to evolve, in LEO and in MEO and in GEO, therefore our perspective could change in the future.

VIA SATELLITE: What new verticals could Eutelsat look to target in IOT as a result of initiatives like this?

Lenotte: New services are being developed in a wide range of sectors including smart cities, the mining industry, agriculture and transportation. In transportation you will see applications in security, predictive maintenance … The number of applications that can be addressed is quite high. Several studies are suggesting that by 2025, there could be well over a few billion connected objects. Satellite will only be able to address a part of it, probably a few million. But for certain applications, there is real business value to connect and track objects. So satellite, as a complement to terrestrial networks, could unlock significant value thanks to the seamless and global coverage it can provide to IOT service providers.