ESA Signs Galileo Contract | Business| Economy and finance news from a German perspective | DW | 20.01.2006
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ESA Signs Galileo Contract

The European Space Agency and Galileo Industries have formally signed a contract to develop the ambitious navigation system. Europe hopes it will rival the reigning US GPS network.


Galileo's goal is to outstrip GPS in the navigation networks market

Europe marked a key step in the development of its Galileo navigation project in Berlin on Thursday when representatives from the European Space Agency and the international consortium "Galileo Industries" signed a contract for the delivery of the first four satellites to be used in the system.

"You are witnessing a very important event in Germany," said federal Transportation Minister Wolfgang Tiefensee (SPD) shortly after the ceremonial signing of the contract. ESA's Managing Director Jean-Jacques Dordain, went a step further, calling the event "a great day for Europe."

The participants in the Galileo project certainly have great expectations. By 2010, Galileo is supposed to be so advanced that it will be superior to the reigning GPS navigational system, built by the United States.

ESA: Galileo

Galileo's 30 satellites will help to fulfil future transport requirements

In order to reach this goal, 3.8 billion euros ($ 4.6 billion) are being invested in research and development. Roughly two thirds of the money has come from national budgets, with the remaining funds coming from corporations. With its 500,000-euro contribution, Germany is the largest donor.

In just two years' time, the Galileo system, including the necessary surface infrastructure, should be so technically advanced that the first four of a total 30 satellites can be blasted off into space.

Tests already successful

Since the end of December, a test satellite has been hovering 23,000 kilometers above the Earth, and is now successfully transmitting signals. That's given the Galileo project's chief executive, Günter Stamerjohanns, further grounds for optimism.

"The future of Galileo Industries is looking good," Stamerjohanns said. "We will be the contractors for the other 26 satellites and the expansion of the infrastructure needed for the system to be fully operational, provided of course, that we as Galileo Industries in Europe work hard and deliver on the project within the given time and cost frameworks."

As a purely civilian project, Galileo should make Europe independent from GPS network, which is controlled by the US military. If Galileo is successful, it could also create as many as 100,000 new jobs. While the German market stands to gain from Galileo, Tiefensee was careful to stress the project's European dimension.

"It's not about creating competition within the European Union, rather about what we have to do to beat our competitors outside Europe," Tiefensee said.

In the medium term, Galileo is predicted to reward investors handsomely. ESA is hopeful that revenues could turn out to be five times as high as the initial investment. Globally, ESA predicts that by 2020, the market for satellite navigation systems will be worth 250 billion euros.

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