By the close of August, OneWeb, based in the United Kingdom, had put roughly 300 satellites into low Earth orbit, or 44 percent of its projected constellation, after emerging from bankruptcy last year underneath new ownership. The company began in 2012 with the goal of connecting schools and providing consumer broadband to underdeveloped areas before shifting its focus to governments and enterprises in the maritime, aviation, and other verticals with more income potential. After spending the preceding twenty years at Thomas Reuters, where he most recently served as a co-chief operational officer, Neil Masterson joined the OneWeb firm as Chief Executive Officer in the month of November as the company was leaving Chapter 11 bankruptcy.
After concentrating the first third of the constellation’s rollout on the Northern Hemisphere, you’re releasing satellites to the south. Explain why the deployment road map is the way it is.
First and foremost, our aim is to connect the disconnected, and our pitch is simple: we give fiber-like connectivity where there is none. That said, we’re quite clear that we’re merely a piece of the puzzle — we’re not a complete answer in and of ourselves. To complete that aim, a variety of providers and vendors will be required to participate. As a result, when we consider markets and the market entry, we do so via three lenses: Is it, first and foremost, a geopolitically strategic market? Is it infrastructure-rich or infrastructure-poor, for example? Our sweet spot is markets that are tactically significant yet lack infrastructure, which guides our go-to-market activities in various ways.
Finally, and most crucially, it’s all about listening to our clients about how they wish to deploy once we’ve chosen those markets. So, if you think about it, we’re moving through the Northern Hemisphere, which is 50 degrees north, strategically vital, resource-rich, but infrastructure-poor. That’s basically where we’re going to start.
It also applies to Southern Hemisphere, where the laws are the same. Then we’ll quickly fill in the blanks. We now have sufficient satellite coverage deployed to switch on service from 50 degrees north to the North Pole before the end of the year. We want to finish covering the Southern Hemisphere by next summer and the rest of the world by the end of 2022.
So it was more strategic to fill out the top half of the Northern Hemisphere first since that’s where the biggest demand exists?
Yes, and it also centralizes the capacity, which we have first because of our polar orbit arrangement.
OneWeb now has $300 million in addition to the $2.4 billion it stated it required for the maiden constellation, thanks to Hanwha’s recent strategic investment. What are the plans for the extra funds?
Actually, I believe there is considerable leeway in the very first $2.4 billion. As the year progresses, we’ll learn more. I’d also point out that we don’t have any debt, which gives us a lot of flexibility in the capital structure. It’s usually a good idea to keep dry powder on hand in any business, but especially in this type of business. But, in regards of how we implement it, we’ll pay close attention to our consumers and follow their lead.
All of these things are on the table, whether it’s increasing market penetration, making more acquisitions — we’re waiting for regulatory permissions on the TrustComm purchase — or actually expediting the implementation of the second generation. However, we must remain laser-focused on developing and activating the first-generation constellation, as well as listening to our consumers to determine what they truly desire from us.
What does the revenue ramp-up look like after you deploy services in Northern Hemisphere later this year?
We’re now doing alpha testing, which is going well. Later this fall, we’ll begin beta testing with the goal of turning the network on for the purpose of paying users by the end of the year. But, before we do that, I want to make absolutely sure we’re confident in our position, in our capacity to have the necessary amount of service professionals in those areas, and so on. Based on what I’m hearing from clients in those areas, I believe the ramp-up will be fairly rapid, and I spent [one week in August] in Alaska. Faster than we expected, in fact, which is the reason why I want to make absolutely sure we have the correct number of resources allocated in those markets to satisfy demand.
What’s the deal with it being faster than expected?
To be honest, I didn’t expect the end-market demand to be as great as it is. We knew there was a demand, but it’s visceral when you’re on the ground. It’s palpable. As a result, I believe we have a chance to engage in that — as I stated, as part of the answer — and I believe many Northern Hemisphere markets will follow suit.