European space giants unite to challenge Musk's dominance

In January, Italian Prime Minister Giorgia Meloni criticised the lack of European alternatives to Starlink and pointed out Europe's delays in developing public communication technologies.

Her comments were made in response to a Bloomberg report about a potential agreement between the Italian government and Starlink to provide secure telecommunication services for government and public administration.

According to Bloomberg, the proposed agreement, estimated at around £1.3 billion, would grant Italy access to a comprehensive suite of advanced encryption solutions for securing government communications over phone and internet services.

The plan also includes providing communication services for the Italian military in the Mediterranean region and launching satellite services that connect directly to mobile phones in Italy, to be utilised during crises like terrorist attacks or natural disasters, as reported by Italian authorities in January.

On Monday, March 10, the weekly magazine Variety described how Elon Musk is still striving to secure a deal with Italy despite strong opposition from rival parties. His recent actions suggest he intends to meet President Sergio Mattarella, who, as the magazine noted, is considered one of the advocates for exploring other satellite service providers, such as the French-British competitor to Starlink, OneWeb.

In January, the Italian Prime Minister questioned why Italy and Europe had not developed public, secure communication technologies promptly, as reported by Politico. The publication also noted that this concern appeared particularly relevant in light of U.S. President Donald Trump's unpredictable foreign policy decisions, which allegedly led a U.S. satellite company to revoke Ukraine's access to images based on an "administrative request" the previous week.

In an article published on 10th March, Politico reported that three European companies – Airbus, Leonardo, and Thales Alenia Space – plan to establish a joint venture in response to, among other factors, Musk's initiatives. The goal is to increase the production of satellites, particularly those for telecommunications in low Earth orbit, enabling competition with the telecommunications giant Starlink and the space company SpaceX, both owned by Musk.

"For security reasons, European countries should invest in their technologies, especially concerning communication. Firstly, this ensures data security and compliance with EU regulations. Secondly, it reduces the risk of losing access to key communication channels during crises," said Aleksandra Wójtowicz, an analyst at PISM.

According to Politico, Italy holds 30% of Leonardo's shares, which control 33% of Thales Alenia Space. Paris backs the project, but Germany, wary of France and Italy's dominance in the space sector, might block it. As the portal noted, "Chancellor Olaf Scholz recently opposed another merger aimed at creating a pan-European giant between the Italian bank UniCredit and the German Commerzbank."

"The decision to embark on a joint initiative by Airbus, Leonardo, and Thales Alenia Space arises from the necessity to combine existing expertise in the space industry and compete for space projects and programmes at a governmental level. It is a response to growing competition from the USA and China," said Paweł Fleisher, Vice President of the Association of Polish Space Sector Professionals, in an interview with PAP. He also mentioned that past European initiatives in this area, such as IRIS, are outdated in terms of current demands.

According to Politico, the head of the European Commission, Ursula von der Leyen, supports projects for integrating European aviation giants. However, creating a joint entity between Airbus, Leonardo, and Thales Alenia Space, dubbed "Project Bromo," would require extensive EU approval due to its competition regulations that limit market monopolisation.