OneWeb teeters on the brink
OneWeb, based in London, has raised $3bn and launched 74 satellites as part of its low earth orbit (LEO) constellation to provide broadband Internet up to 400 Mbps with a latency of 32 ms. It had begun development on a range of user terminals for a variety of customer markets and has half of its 44 ground stations completed or in development.
Since the beginning of the year, OneWeb had been looking for investment that would fully fund the company through its deployment and commercial launch. The lead investor is Japanese giant Softbank, as well as Qualcomm and the government of Rwanda. OneWeb says its commercial team has seen significant early global demand from automotive, maritime, enterprise, and aviation industries.
The company said that while it was close to obtaining financing, the process did not progress because of the financial impact and market turbulence related to the spread of the Covid-19 virus outbreak.
The application for Chapter 11 protection under the US Bankruptcy Court allows the company to keep running, potentially with a sale of its assets.
“OneWeb has been building a truly global communications network to provide high-speed low latency broadband everywhere. Our current situation is a consequence of the economic impact of the Covid-19 crisis,” said Adrian Steckel, Chief Executive Officer of OneWeb. “We remain convinced of the social and economic value of our mission to connect everyone everywhere. Today is a difficult day for us at OneWeb,” he said.
“So many people have dedicated so much energy, effort, and passion to this company and our mission. Our hope is that this process will allow us to carve a path forward that leads to the completion of our mission, building on the years of effort and the billions of invested capital,” he added.
“It is with a very heavy heart that we have been forced to reduce our workforce and enter the Chapter 11 process while the company’s remaining employees are focused on responsibly managing our nascent constellation and working with the court and investors,” he said.
Satellite companies have a history of funding challenges. Iridium for example went bankrupt in 1999 after spending $5bn on building a LEO constellation, but operates a network of 66 cross-linked satellites today.