Galileo's Expensive Position

Europe's most recent monetary crisis may further slow or even take out the Galileo satellite navigation program. Or this is just crazy talk, and the European community will continue to fund the 3.4 billion euro project as an alternative/complement to using the U.S. Global Positioning System (GPS) and the Russian GLONASS network.

Like many European aerospace projects these days, Galileo has had a bumpy ride since inception and no clean end in sight.   Started in 1999 to establish a "European" Global Navigation Satellite System (GNSS) independent of U.S. and Russian systems, the project was initially envisioned to be operational by 2008 and cost 3.3 billion euros. Money to build and launch an initial baseline constellation of 30 satellites would come from private companies and investors funding at least two-third of the system and the European Union and European Space Agency making up the rest.

By 2007, the European Commission (EC) ended up stuck with the bill as the private consortium of companies involved - EADS (News - Alert), Thales, Inmarsat, Alcatel-Lucent, Finmeccanica, AENA, Hispasat, and TeleOp. -- couldn't work out a company structure to run and fund the system.   The delays mean that the first four in-orbit validation (IOV) satellites won't be launched until later this year and early 2011. A partial system of 14 full operation capability (FOC) satellites is currently expected to be up and running by the end of 2013 with a price tag (News - Alert) of at least 5.5 billion euros.

It's a high price for political independence when member nations are having trouble meeting the commitments to the ESA due to tight budgets at home; Spain usually contributes 5 percent of the ESA's budget, but it has asked the agency to take out a loan if necessary to make up its share.

Perhaps the deeper question is who will use Galileo other than European government agencies.   Proponents of the system have touted civilian applications in location-based services, transportation, energy, and civil engineering as potential uses for system, citing fears the U.S. would either detune or shut off GPS signals, leaving European users high-and-dry when they most needed navigation signals.

Incorporating Galileo into existing applications will be an uphill battle, with end-users having to assume the expense of learning about the new system, incorporating it into their hardware and software, and paying for the additional cost per unit in terms of material costs. Until a significant user base builds up around the system, end-users are going to have to pay more to adopt Galileo and it isn't clear how many consumer electronics companies are ready to do so at this time.