Ever since he founded and pioneered O3b Networks, Greg Wyler has been one of the most talked about figures in the satellite industry. His latest brainchild, OneWeb, continues to be one of the most talked about, and even one of the most polarizing, companies in the sector. Last year’s interview with Wyler interview took on an almost evangelical tone as Wyler talked about OneWeb’s mission. This time, we get down to the practicalities and address the burning issues regarding OneWeb’s future.

VIA SATELLITE: Can you give us an update on OneWeb’s progress and whether things are on track in terms of the planned launch of satellites? Are you on schedule to launch the first test satellites by the end of the year?

Wyler: The system has been designed. The satellites have been tested. They are going through final stages of testing now before the launches begin. The satellites have actually performed better than expected in many ways, especially with their Radio Frequency (RF) performance which is really positive. The challenge I have always had in the satellite industry is to manage margin as engineers and suppliers often keep performance buffers, so it is not a huge surprise when a high-quality company builds a satellite and it performs better than expected. They are launching these first satellites in the next 4-5 months, and following this with many more satellites. After that, we will embark on the real important part of why we did this, which will be to reduce the digital divide and bring connectivity to all of those locations around the world which are without access.

VIA SATELLITE: When we spoke before you said the company would enter into commercial service in late 2019? Are you on track for this?

Wyler: It might be early or mid-2020. You just don’t know when you are doing something this new and big. If you miss it by two months, six months, or even a year, you would be considered to have very great foresight. Many bold projects take many years longer than anticipated because you are travelling down a new path. We have done everything we can within the company and the design and architecture to not only ensure the safety and sustainability of space, but also to have the lowest risk program possible to get the satellites up, get them operating, and start servicing customers. From there, OneWeb will have a great foundation to iterate towards its next generation of systems and satellites.

VIA SATELLITE: Is the delay only likely to be a few months?

Wyler: I think we will have customers up and running in 2020. You can never say for sure because people have driven forklifts into solar panels of satellites before. Things can go wrong. We are using a reliable launch vehicle. We are using best practices in the design and the build procedures, but things do go wrong. But, barring some unforeseen situation like global financial meltdowns, we will be largely on track. I remember in 2009 when we did a financial round with O3b, we raised $180 million two weeks before the Lehman Brothers crash. If the signatories on that investment had taken 2-3 weeks longer, O3b would either never have happened or it would have happened many, many years in the future. So, barring unforeseen events, and barring major changes of impact, OneWeb should be turning on in the 2020 timeframe — which is still pretty good.

VIA SATELLITE: Where does OneWeb stand in terms of financing? Does it need to secure extra financing?

Wyler: You always need more. The need and the vision dictate that. We will see how that comes along, and we will see what the appetite is of the investment community and see what the possibilities are. Things are changing very fast in the satellite industry. Things are changing very fast on the ground. The needs are changing, and you have to adjust, design, and predict to bring those adjustments, new designs, and the predictions confidently to your investors. I think OneWeb is pretty strong here and has earned the confidence of investors. These are big expensive projects, and you have to keep your eye on the ball to make sure you can see them through.

VIA SATELLITE: Are you expecting major developments over the next year in terms of financing?

Wyler: Today, we are in the middle of a fluctuating market, which many people predicted, but a number of others are aghast at the possibility. I expect the unexpected over the next year. But, so far this has not had any impact on OneWeb. It is a thing on the front page of the newspapers. It is a large, unexpected volatility. But, the way I think about investing time and money is related to impact and large scale thematic movements and needs. So, in this case, whether the stock market goes up and down, the need and impact OneWeb can have in terms of the people it will serve and the problems it will solve will remain.

VIA SATELLITE: You mentioned that if the timing had been different, O3b may never have seen the light of day. Are there parallels with OneWeb right now?

Wyler: I don’t think so. The real turning point for OneWeb will be when the first production of satellites are launched and turned on. That will be a nice, clear milestone and also a public milestone. We will be open and transparent about the systems. Things will break. Things will go wrong. There will be many bugs that need to be worked out. I will predict that future. We expect that this inflection point will be reached early next year.

VIA SATELLITE: Are OneWeb’s satellites now costing $1 million a time? Has the cost of the satellites doubled since your 2015 projection?

Wyler: The answer is they are really close to our 2015 projections. Whether they are $500 thousand or $1 million is virtually irrelevant because what they are not is $50 million, and that is where it started. These are extremely powerful satellites with lots of built in redundancy and resiliency. They are safe, telecom carrier-class satellites. So, while there has been a very heightened focus on whether these are $500 thousand or $675 thousand, which is interesting, but, I don’t see it as a pivotal point.

More interesting, is that I think the satellite industry is going through an inflection point in total. Everything about satellites will get cheaper and performance will get better. Satellites have become just a piece of technology. Five to ten years from now, satellites will have a whole bunch of features that are not available today. It is kind of funny to hear these conversations about future satellites and constellations without real timelines. We know where it is all going in general. We just need to make sure we have the right timelines associated with it so we don’t get a little bit ahead of ourselves mentally or financially.

VIA SATELLITE: So, 2,000 satellites costing $1 million a time would not be an issue for OneWeb?

Wyler: It is always an issue on an individual financial basis. If it costs a dollar more, you need to raise another dollar, etc. But, it is a question of if you are moving the needle 5 percent, 10 percent, or 50 percent on your business plan. Two things are happening. They may cost a bit more than I wished but they are also more capable than we thought. It balances out nicely. It is not about the cost of the satellite. It is about the services that can be delivered.

VIA SATELLITE: So, the industry should not be hung up about the cost of these satellites, and that they could be 100 percent more expensive than originally planned?

Wyler: We should be concerned all the time. You have to be fairly paranoid about any business. But, the exact cost of the satellites whether plus or minus 20 percent is not a large mover of whether the business model works.

VIA SATELLITE: So, no more than 20 percent then?

Wyler: I do know the general final costs. I don’t want to specify it as the final costs are inclusive of a number of things, which are beyond the scope of just what is the marginal cost of the next part. We look at it in a holistic way, testing, launch, etc. Then we apply that to the cost per bit. It is not about what the individual cost of a satellite is, as they are one piece of the system. Of course thinking about the marginal cost of an individual component is more exciting and easier to think about. But, it is really just one piece of the entire system that go into the cost structures. The really good news is that the cost per bit is continuing to drop.

VIA SATELLITE: Eric Beranger spoke about a huge pipeline of customers. Can you give some more clarity?

Wyler: The biggest, fastest user adoption of the system will be where there is high demand and where there are people with a lot of understanding of technology. That will come from mobility and markets where there are people every day trying to find answers to some of the questions they are looking to solve. So, the mobility markets and the emergency services markets are really important ones.

I have talked about emergency services since the beginning. We have seen hurricanes in Florida and the Caribbean, where the connectivity infrastructure was destroyed. Sadly, many people have lost their homes, lives, and more. Without connectivity, there is continuous, unresolvable panic. Without connectivity, you cannot reach your friends and loved ones. You need to figure out who needs help and where to bring the help.

I have spent many years in the Caribbean and still have a house there. During last year’s hurricane, I couldn’t reach my friends. I was personally wishful that OneWeb was up and running at the time. Everyone went dark for weeks in the Caribbean. There were lines of people wanting to use phones to just try and make a short phone call. I think OneWeb will have a very big impact early on because the need is so great. You never know when the next natural disaster will be.

What I am hopeful of is when OneWeb launches and turns on, OneWeb and governments around the world will work closely to ensure that there is pre-positioning of terminals, and that the emergency response vehicles are outfitted appropriately so that they can maintain continuous, low latency connectivity, enabling videoconferencing for medical facilities, for example. So, that connectivity can continue after a hurricane and an emergency. We are talking with governments and health ministers around the world on this topic. I think it will be an important and impactful thing for OneWeb to do.

VIA SATELLITE: What industry verticals are the main targets for OneWeb?

Wyler: There are many of course. Aviation is a big one for us. There are four billion passengers a year on aircraft and they would like to maintain connectivity. There is no good solution today. Someone recently sent me an article of an interview with the Chief Executive Officer (CEO) of a major European airline who was talking about how their antennas have line of sight issues, and passengers are getting cut off whenever a plane banks for a turn. The really low look angles required for Geostationary Orbit (GEO) satellites cause performance issues, as well as the latency that occurs with GEO satellites, which is getting worse now because so many people are on cloud operating systems that demand low latency and fast response times. At the same time, people are streaming more. But, I think aviation will be a major area for us.

But, one thing that is close to my heart, is that I want to make sure we will continue to connect schools, people, and health centers in emerging markets where there is no alternative. That is where I have been investing inside OneWeb, as well as outside. There is also a lot still to be done in the terrestrial industry to solve these problems.

VIA SATELLITE: I have never really heard you talk about aviation before. So, you think you can take business off the likes of Viasat, Eutelsat, Intelsat, or even SES?

Wyler: I wouldn’t say it that way. The market is growing incredibly fast. But, there is not yet an ability to meet the service demands. Just because OneWeb comes into that market, it doesn’t mean that another company loses a customer. I don’t see it as one versus the other. They have complementary services, the GEOs and Low Earth Orbits (LEOs) for sure. OneWeb will certainly be a large player in the market, but so will others. There is definitely a need. Airlines have been coming to us and asking for help.

We were an early co-founder of the “seamless” aviation standards body. The airlines were coming to me and asking lots of questions about connectivity, but did not have any answers. Many airlines talked about the enormous frustrations for customers when they get on these commercial aircraft. It is expensive to use, hard to log on, and when they do get on, it is not very good. Some of it boiled down to the question — why not allow mobile operators to roam onto aircraft?

Airlines have tried to be their own Internet Service Provider (ISP) and their own mobile operator, in effect. You (the airline) have said anyone on my plane has to go through my specific service. Why not open that up? Why not let Sprint, DT, roam onto the plane? You can give the customers 4G/5G on the same devices they are used to using in their car, at the gate, or in other places. So, that concept of putting small cells on aircraft and standardizing the equipment inside the aircraft to reduce the costs — that concept got its own feet.

The community is effectively moving towards data centers on aircraft where the aircraft passengers could experience ultra low latency, one millisecond ping times to their on-board servers. You can create some really interesting and innovative, interactive applications for people to experience and play with while they are on the aircraft. In many cases, you can experience applications that are better on the aircraft than they are at home, such as gaming and Virtual Reality (VR). The plane itself can become a Local-Area Network (LAN) party! I have been in aviation my whole life so this is always something I have been interested in. It just sparked out of some conversation as we listened to the senior leadership of airlines vent about their challenges. So, it seems to be taking off.

VIA SATELLITE: When I asked you last time about the numbers of satellites, you said you had to look at “The Mission” on what you were looking to solve. So, in order to solve this mission of digital inequality, how many satellites do you think OneWeb might need?

Wyler: So, how do we bridge this digital inequality and this digital divide? There is a huge global capability gradient, which is a mirror of an opportunity gradient, that needs to be fixed because that gradient is getting larger. The capabilities of those with access are growing at such a rate that the people that are not given the opportunities to have access to the internet are being left behind. The more that differential happens, the further behind large parts of the population will be. We are seeing that today in many, many countries. It demonstrates itself in income differential, mortality, and gender equality as well as a number of other societal indicators.

As I said, the people to thank for reducing the digital divide and improving access to the world’s information are the telecom operators. They have done more to drive the internet into rural populations than anyone else. They get very few rounds of applause for that. They are making an effort to increase coverage, however, the cost structure of their infrastructure is too high to really reach into the rural populations. What will happen is the terrestrial markets cost structures will come down, and they will reach further into these populations, which will impact how much bandwidth needs to come from space. It will be very good for these populations from an economic and social viewpoint.

For the foreseeable future, no matter how far the terrestrial market systems drive into the rural populations, you are going to need satellites. No matter how big of a constellation we make, they are not going to completely solve the problem. So you have to take it in chunks. You need to look at individual goals and steps. One of the first steps where satellite can really make an impact on is connecting schools and health centers. These are two notable global needs that are relatively easy to define and that we should make sure are connected across the globe. It is a shame that they are not connected already.

OneWeb with its first constellation, will be able to make a big impact on health centers and schools. There are plans for follow-on satellite constellations. The goal is actually to use as few satellites as possible. More is not better. In fact, more is worse. You want to build fewer, more efficient satellites, not volumes of inefficient satellites, because of the potential for catastrophic events. So, we have been very careful on our design scenarios to try and optimize the performance of the individual satellites, while meeting the characteristics and needs of customers and potential users. At the same time we keep a very sharp eye on the impact of space debris.

VIA SATELLITE: OneWeb has had a number of CEOs over recent years. Is this senior management instability a worrying trend?

Wyler: We are on our third CEO, which is exactly the same as O3b was on at the same stage. Steve Collar was the third CEO. The important thing is as the company evolves, the leadership and the management team are evolving. Within the company there has been very low turnover with reasonably high growth. New management takes the company from one level to the next where it is now focusing more on its commercial phase. Satellites will be launched in the near future. Customers will start to get onboarded. It is moving from a “how do we build satellites” phase to a “how do we service customers as a global telecoms operator?” phase. Adrian as the founder of Iusacell, who also built 150,000 kilometers of fiber across Mexico, Peru, and Colombia, has a strong telecoms background, and a very commercial viewpoint on how we ensure that our customers will get high-quality services. It is a natural evolution of the company. The plan for the company has always been to move toward a global telecom operator model and capability.

VIA SATELLITE: In five years time, knowing what you know about the satellites, the mission to reduce digital inequality, and targeting new markets like aviation, how many satellites will OneWeb have up?

Wyler: I would like to keep that number below 1,500, but we will see. It could be above that. We have designs that include a lot more. But, a more efficient and elegant design is having less satellites with more built-in capability. So, you don’t need as many cheap, small satellites. There is this challenge of space debris which is a large responsibility that hangs over all of us in the industry. We can’t cause a conflict. It is not our space to be risking. We need to keep that in mind as a variable as we design the system. There are some very unsafe architectural ideas for a lot more satellites in an orbit, but those hopefully remain thought experiments for the time being. This is where governments are stepping in and saying that we can’t have overlapping constellations, and they are starting to specify safety margins between satellites in terms of orbital dynamics. This is something which is mostly unregulated and historically, has not been well considered.

The problem is coming. As access to space becomes increasingly cheap, satellites will be easy to produce. In five years, thousands of cubesats could be launched at a low cost. They may become more economically viable, but you are still throwing up objects with mass and an ability to cause massive amounts of destruction when they hit something. This is something we collectively need to consider carefully, and where OneWeb has been proactive.

When you ask the question about how many satellites, my ultimate response is to consider how can we do this efficiently and safely, so that we can have the positive impact for humanity but not the negative impact of satellites colliding.

VIA SATELLITE: There were lots of rumors floating around Paris on the future of OneWeb. Can you tell the Via Satellite audience that everything is okay on the good ship OneWeb?

Wyler: Things appear as okay as ever, but there are always plenty of things to worry about. All of the small challenges, like components that come in and don’t match the specifications, for example. There are issues like launch timing. These issues are always there when you build something like this. The question is: is the team capable and do they have a plan that can return positive capital while accomplishing a worthwhile goal which simply must be done? The answer to those questions is yes. Airbus is doing a fantastic job in building the satellites, which are about to go up in the near future. OneWeb is lucky to have such strong supportive backing from many shareholders. But, I will say, this is really hard. I remember when I was at O3b, we spent five years doing this. If you asked me is everything was okay during my time at O3b, then the answer would be no. There wasn’t a day when it was okay. We made progress, but it was never as fast as we liked. But, generally, you stay focused on the horizon and getting the constellation launched in a safe and reliable manner, and you stay focused on accomplishing the mission — and you will get there.

I have seen a lot of people come in and out of the satellite space. There are lots of people who are interested in starting a satellite company, which seems to be quite in vogue, and many find their way to have a chat with me. With all these various startups and plans, and all the delays and challenges they are having, I think people are realizing that these types of companies are really just short of impossible to create. At least, it feels that way. However, at some point, you do get over the hump, the system gets launched, and the company moves into a much different position.

If I look at this more broadly, I don’t think you can do this if you are doing this for the money. You have to do this because you want the mission to succeed. You want it to happen. If that drives you, you can get to the end and make it happen.

VIA SATELLITE: Are SoftBank still on board with the vision of OneWeb?

Wyler: Masa has been incredibly supportive of OneWeb and its vision. All of our investors came in sharing that common vision. VS