The European Commission and the European Space Agency's selection of preferred bidders for the procurement of the European satellite navigation system, Galileo, broadly reflects the original competing consortia and the political divide that delayed the project.
On 19 September the EC and ESA announced their selection of 11 preferred bidders, from the 21 that applied for a reorganised Galileo infrastructure procurement process with six work segments that no one company or group can dominate. Galileo, previously estimated to cost up to €3.4 billion ($4.8 billion) in 2001, is to have a constellation of 30 satellites, two ground stations and related equipment.
Originally planned for a 2007 deployment through a public private partnership, the EC and ESA now aim for a 2013 roll-out of an entirely government-funded programme. To achieve this target date the preferred bidders have until late November to submit their bids with contract awards taking place from the first to the third quarter of 2009, depending upon for which segment a company or group bids.
Galileo’s delays saw a third test satellite, GIOVE-A2, ordered by ESA
ESA's just retour contracting policy rewards industries of member states' that invest heavily in a programme. The space agency is managing Galileo for the EC, but the programme's full funding by the European Union means industry is expecting EC competition rules to be enforced, up to a point.
"There will be no just retour, apart from a balanced distribution [of contracts]," says UK multinational Logica's space and satellite communications director Stuart Martin.
The just retour principle caused the first procurement attempt's problems with allegations that German, Italian and, to a lesser degree, Spanish government squabbling over workshare caused the process to collapse.
In 2003 there had been four consortia and by 2006 they became two, iNavsat and Eurely. They followed a European north-south divide, with EADS a leading company in the largely northern European iNavsat group and the Franco-Italian Eurely "space alliance" consisting of Finmeccanica, Alcatel's space arm and Spanish companies. That disputed selection process saw a merger of the two groups kill the procurement with gridlock.
Now the process has played to the countries' candidates' strengths and this month's selection reflects the companies that led those four original consortia. Eutelsat was working with AENA, Hispasat and Logica. EADS Astrium, then known as Space, co-operated with Inmarsat and Thales. Finmeccanica allied with Alcatel and the fourth was Germany's OHB.
Five years on and Thales and Finmeccanica's Thales Alenia Space alliance's French and Italian divisions are candidates for the segments "ground mission system" and "system support", respectively, and are competing against Logica in both.
While Astrium's German wing has been selected to compete for the "space segment" package against OHB, guaranteeing the satellites' manufacture for the central European country. Working with the UK's Surrey Satellite Technology (SSTL), which built the first Galileo test satellite, OHB will integrate SSTL's payload if it wins.
But SSTL's commercial director questions whether the 28 of the 30 satellites up for grabs will actually go to one company or team, "It is unlikely they will award it to one company. EADS will make the economies of scale argument, but [the US Navstar global positioning system] does not have one platform," says John Paffett, referring to Boeing and Lockheed GPS spacecraft.
While there are six segments, one of them is not competitive. Arianespace has been named as Galileo's launch services provider. While ESA's director-general declined to guarantee the launch services company's primary role for deployment in January, the constellation will now be orbited using a combination of EADS Astrium Ariane 5 and Samarra Space Center Soyuz 2 rockets under the Arianespace umbrella.