A pragmatic approach will be needed to make Galileo a success, said Jean-Francois Bou, interim CEO of Euro GNSS — the Galileo operating company).

"In a complex project such as this, it is important to look at the long-term perspective and not be discouraged by short-term local or operational issues," Bou said. "Everyone recognizes the need to move forward, and our energy has not been wasted. It is not a matter of optimism or pessimism — it requires pragmatism to make things happen."

Bou, named interim CEO, in March was speaking after the European Commission (EC) issued a communication May 16 describing the Galileo satellite navigation project as being at a "crossroads," and calling for the program’s development efforts to be fully funded by European governments and taking development of the system from a consortium of European companies.

With a number of industry players involved in the project since the two consortia combined, the project has been hampered by delays. Industry players involved failed to satisfy a May 10 deadlines that they resolve their differences in order to move the project forward. The deadline was given to come with a structure for the company to run Galileo, a CEO for that company, and other organizational issues.

"The lack of progress in the negotiations on the concession contract, which provided for the deployment and management of the infrastructure by the private sector, is posing a serious threat to the completion of the project," the European Union said in a statement.

The EC said the Galileo roadmap "needs adapting" if it is to meet the deadline and be operable by 2012. The Commission also said the public/private partnership on which the project is based needs to be "reprofiled".

"Clearly there is still a lot of work that lays before us and we must tackle the various milestones one by one," Bou said. "Let’s not forget that the potential for Galileo is huge. It is a key project for Europe and the European space industry. And even though its implementation may be a bit different from the initial plans, Galileo is and remains an exciting program."

Jacques Barrot, EC transport commissioner, mounted a vigorous defense of Galileo last week, saying that "Europe needs a satellite radio navigation system as part of its essential infrastructure for crucial applications such as border control, transport logistics, financial operations and the surveillance of critical energy and communications infrastructures."

Bou said, "negotiations are in a critical phase. The reasons for that can be expressed in a balanced manner between the structural problems of the Concession and the risk transfer issue (design and market risk). On governance issues, the problems encountered by the industry and the Commission are a clear recognition that it is a long process and that there is a need to address the matters that are not working. In my opinion, this is quite a sane reaction."

However, the EC admitted changes needed to be made and that there has been a "lack of progress" on the Concession contract, which provides for the deployment and management of the infrastructure by the private sector. The EC also said the timetable and costs for Galileo need to be "monitored more closely," In terms of the funding for Galileo, the EC said that the infrastructure part of the program should be funded by the public sector, and the operation of the system should be entrusted to the private concession holder.

For members of the consortium, it is now a question of wait and see. Bou said, "When you have a number of member states around the table, it is difficult to reach an agreement, and it is equally a challenge for eight industry parties to reach a consensus. We will await further comments from the European Commission about our position."

— Mark Holmes