European companies to get bulk of mobile satellite spectrum in EU tech push
EU Spectrum Allocation Strategy and Implications
By Foo Yun Chee
Overview of the EU's Spectrum Allocation Plan
BRUSSELS, May 27 (Reuters) - Europe announced plans on Wednesday to allocate the bulk of valuable mobile satellite spectrum to European companies while reducing the share U.S. operators can acquire, as part of a push to reduce reliance on Big Tech and promote domestic businesses.
The EU move is driven by concerns over China's technological rise and the dominance of U.S. tech giants at a time of transatlantic tensions.
Impact on U.S. and Global Satellite Operators
Elon Musk's Starlink and Amazon's low-earth-orbit business are major players in the satellite internet market, and analysts said the EU's latest plans for its satellite spectrum could put those U.S. competitors at a disadvantage.
State Use and Security Provisions
One third of the spectrum will be reserved for state use such as security and military, to be provided by an EU operator that will integrate the capability with the EU's IRIS2 multi-orbit array of 290 satellites, the European Commission said. IRIS2 is Europe's response to Starlink.
Commercial Use and Transitional Arrangements
The remaining two thirds of the spectrum will be divided equally between EU and non-EU operators for commercial use, the EU executive said, confirming a Reuters report. The move is a compromise after at least one commissioner wanted to exclude U.S. operators.
The 2GHz frequency band in question is ideal for direct services allowing users to bypass telecoms providers and also for providing critical communication capabilities and ensuring access to high-speed internet in remote areas.
U.S. companies Viasat and EchoStar will have their 2GHz licences extended for two more years when they expire in May 2027 as part of a transitional period, the Commission said.
Statements from EU Officials
"We want to boost Europe's competitiveness. We want to strengthen Europe's security. We want to embrace new technological possibilities. And all of this by taking into account the current changing geopolitical context," EU tech chief Henna Virkkunen said at a press conference. "Our proposal ticks all these boxes."
Virkkunen dismissed potential U.S. criticism that the proposal may be targeting U.S. companies, saying "we are very transparent and fair".
Market Reactions and Future Prospects
The commission's plan could hamper Starlink owner SpaceX's ambition in Europe and leave it in a "structurally inferior" position, BNP Paribas Equity Research senior analyst Sam McHugh wrote in a client note.
"It is a small positive for European telecom operators as it further reduces the odds of SpaceX ever being able to compete head-to-head with wireless carriers in the EU."
The Commission could in future also allow British and Norwegian companies to acquire part of the spectrum allocated to EU operators.
Next Steps and Internal EU Debate
The latest proposal will need to be thrashed out with EU countries and EU lawmakers before it can become law.
The tech sovereignty push has been marked by internal divisions at the Commission, with some wanting to be more aggressive and others wanting a more gradual line. At least one commissioner had argued for U.S. companies to be excluded from the spectrum.
(Reporting by Foo Yun Chee, additional reporting by Akash Sriram in Bengaluru; editing by Inti Landauro, Kirsten Donovan and Stephen Coates)
