Eutelsat Communications S.A. (ETL) Earnings Call Transcript & Summary

Good morning, everybody. I'm very glad to welcome you here in London. My name is Dominique D’Hinnin. I'm the Chairman of the Board of Eutelsat Communications, and I am very glad to introduce this meeting, this morning, the team who will be here to -- well, technology not always works. Anyway, so the team who will be presenting the show this morning is first, Eva Berneke, our CEO; Sandrine Téran, our CFO; Jean-Hubert Lenotte, our Chief Strategy Officer; and Pascal Homsy, who is our Chief Technology Officer. On the OneWeb site, we're happy to have Neil Masterson, our -- the CEO of OneWeb; Srikanth Balachandran, the CFO of OneWeb; and Massimiliano Ladovaz, the Chief Technology Officer of OneWeb. On top of that, on the screen, I mean, by video, Sunil Mittal, the number -- the first shareholder of OneWeb will be there as well, ready to answer your question. I now give the floor to Eva, who is going to present you the whole project.

Thank you, Dominique, and thank you to everybody, and welcome to London. Both for you -- those of you who actually made it physically into this room, very pleased to see you, but, of course, also, to all of you who will be on the screens from everywhere in the world. I've been looking so much forward to this morning to share our visions for how to accelerate connectivity around the world, how do we make sure that everybody in the world would get connected with high-quality broadband over the next 5 years. What we plan to do this morning is to share the following agenda: start out a little bit with the vision of 2 very complementary companies, OneWeb and Eutelsat, joining forces to create a truly unique player in the satellite world; with addressable [indiscernible] market, we will be jointly addressing a high-growth, double-digit growth market of connectivity; give you a bit of background on OneWeb. We will skip over a very long story about Eutelsat because I believe quite a few of you already know Eutelsat. However, OneWeb is a privately held company. You're probably curious to hear more from Neil and his CEO of where they stand today. Then we will come back on the complementarity of the 2 companies. I think that's a very important part that these 2 companies fit very well together at this time and space. And then we will talk a little bit about the network on which we stand on, the Gen 1 of the OneWeb. Neil and Pascal will be telling you a little bit about the technology behind making all of this happen. And then we will come back -- we might have a short bio break there if we've been talking too long. But then we will come back and give you a little bit on the financial background and how this all will work out, and when we get into the financial numbers, and specifically also the very significant synergies that this deal represents. Then we will round up, and we'll hopefully have a good hour or so for Q&A. So that's what we are going to do, and I'm going to jump right in and start out with our vision for why this makes sense. This makes sense in a high-growth connectivity market, expected to be around $16 billion in 2030. That's a double-digit growth over the next 6 to 7 years, and 2/3 of that growth is going to come outside the GEO space. There will be growth in the GEO space, and we're certainly addressing that through Eutelsat, among other things, our recent launch of KONNECT VHTS, which will address that growth. But 2/3 of the growth will come in non-GEO space, which means that we need to play in LEO in order to be addressing 2/3 of that growth market. And there, OneWeb is a truly unique asset. It's 1 out of only 2 players that's working today in the LEO space. They have the spectrum -- priority spectrum. They are first mover, early mover, in a market where early mover advantages are significant. And it's in natural next step for Eutelsat who already 1.5 years ago took a first participation in OneWeb with a 23% ownership. So OneWeb is a unique asset and perfectly fitted for our ambitions to address the connectivity market. And combining those 2 will actually create something truly unique in the market. It will be the only player that can address the connectivity market with the combination of LEO and GEO capacity. I'll come back to why that is an extremely strong value proposition, but it combines the strength of both. It combines the strength of LEO in terms of low latency and ambiguous coverage of the world, but it combines it with the strength of GEO, which is the capacity for flexible -- large amounts of capacity in a very cost effective matters. And when we ask customers, the actually want both. They want the best of both worlds, and we'll be the only one who'll be able to try doing that. But on top of that, we actually also have a deal, which gives investors the access to EUR 1.5 billion in synergies. We will come back to how it is, but it is actually a fairly robust number because we know OneWeb already. We've been part of OneWeb for the past 18 months, so we know the company. We know exactly where it is, but we can also see that it is now time to accelerate. So the EUR 1.5 billion is a mix of solid revenue synergies between the companies, accelerating OneWeb cost synergies and very significant CapEx synergies, which we need to start addressing now. That will give you -- and we'll come back and give you the detailed financial numbers. A high-growth company -- so a fundamentally changed financial profile of Eutelsat with high growth, but also a very robust financial profile over the next couple of years. So that's the story. We'll be spending the next couple of hours diving into, but let me start out with how these 2 combine and what's so unique about this combination. First of all, there's a lot of geographical advantage in terms of covering the globe. We want to cover the globe and be able to address connectivity needs everywhere. And here, the math between GEO and LEO is quite well matched. LEO provides a full global coverage, which is expected for OneWeb to happen by end of next year. There's 5 launches left, Neil will tell you much more about it. But there will be a full global coverage. Today, it's covering the Northern part of our globe. And GEO, as you know, has a capacity to actually focus large amounts of capacity in high-demand regions. So very good geographical match, which also falls into the value proposition to customers. GEO will provide you with, at least in the satellite space, low-cost capacity, able to actually have high fill rates on our satellites as well as also be able to deliver very high capacities to single customers in single places, whereas customers also want the low latency. For certain utilizations, low capacity is key. Whether it's military or whether it's certain amounts of broadband users, you actually want the low latency. And you also want coverage everywhere. So that's a very complementary value proposition to our customers. Access to customers, and I think that's a key element of why this happens now. It's now that OneWeb is starting to really scale up the commercial efforts. And here, leaning into the commercial coverage that Eutelsat had built up over the past 40-plus years of service is an extremely strong thing to be able to do. Leaning into that, knowledge of customers, that global coverage in order to accelerate OneWeb is very important. But it also gives Eutelsat access to some new customers who actually are attracted by this combination of the 2. And then finally, complementary financial profile, Eutelsat has, based on our very strong legacy business in broadcasting, a solid financial cash flow, which will be able to finance the investments into the network, in the Gen 2 over the next couple of years. So the complementarity between the players is not only financial, it's across multiple business levers. But why now? Why not wait? I think that's been a question that's been asked a couple of times. And we believe that now is the right time. It's a natural next step in our journey together with OneWeb. We stepped in as a second largest shareholder behind the Bharti Group about 18 months back. Earlier this year, we took a second step that was creating a big distribution agreement. But we see that now we really need to join forces in order to be able to move fast. And we need to move fast than this market opportunity because the satellite market is at an inflection point. And we see competition moving fast. We need to be able to move fast as an integrated company. We've also seen now OneWeb -- actually, we've been there for 18 months. We've seen OneWeb coming through a successful launch of the business. They're starting to serve customers. Customers are using the service. They're happy about the service. They are paying for the service, which is always a good thing. So we see that OneWeb actually starts to work. So that's why we feel that we know this market opportunity really well, and it's now the right time to join forces. We also need to address the synergies, and we can see here, OneWeb is in the process of ramping up the organization. There's already a 500-people strong growing organization. But combining the 2 organizations will allow faster acceleration. And it will lean into those EUR 1.5 billion synergies, synergies that will come from the commercial match, from cost synergies and as well as CapEx synergies. And I think that's the last point. It's now that the CapEx and design of Gen 2 needs to take into consideration the combining of the 2. When you design the Gen 2, you need to think about the peak capacity can be provided with the GEO network. And on the other hand, when we renew our satellites in the GEO network, we need to take into consideration that we stand on the shoulders of a strong LEO network. So for future CapEx, it makes sense to join the technical forces and do the CapEx planning together. And that gives us a significant chunk on the EUR 1.5 billion comes from the CapEx synergies where you need to be one company in order to be able to do that. So to me, this is all about speed of execution in a market where we're up against competition, who's going fast and who's changing this industry, and building on top of an early mover in a market where early mover advantages are real in terms of spectrum right and in terms of customer acquisition. So that's why it's right to join the forces at this time and space. We'll come back to the market in the next chapter, but as you know, Eutelsat has traditionally been in 2 markets. It's been in the historic video market, which is in low to mid-single-digit decline, and it's been for a while. I think that's a discussion we've had with many of you. But we've also started to address significantly the connectivity market. And today, it's around 2/3 or 60% video with about 1/3, 40% in the connectivity market. That's Eutelsat's numbers today. But with this combining of forces, that will flip. When we look towards '27, around 70% of our revenues will come from connectivity. Of course, based on the strong growth expected in OneWeb, but also the growth that we'll see in connectivity in the GEO space. And in terms of developing on revenues, we expect that '27 we will see around a $2 billion -- or euro company as we speak right now, with margins that are in the same order of magnitude that we see with Eutelsat today. There's no indication that we not also on LEO space will come up to the same kind of EBITDA margins when we look into the mid- and long term. So we'll come back to more details, both on OneWeb's early ramp-up, but also on the combined numbers in a later chapter. But a very strong, but also very different financial profile in Eutelsat, double-digit top line growth and the bottom line that outgrows the top line. That's what we're looking at for the next 5 years. As discussed, the value of synergies playing into this quite significant element of this deal is the EUR 1.5 billion in synergies, which might be a little counterintuitive given the differences in companies, a very young, high-growth company combining with a historic player in the GEO [ stationary ] . But a lot of these synergies are real, and they are fairly robust. And we are fairly certain about them because we've been part of OneWeb for the past 18 months. We know the organization. We work together both on a technical aspect, on regulatory and on commercial. So we are fairly certain that we can actually come with this. And we also see them as relatively low cost because a lot of it is avoided cost. The first important one is revenue synergies that's linked to a fast ramp-up of OneWeb. Leveraging Eutelsat's commercial reach and commercial competencies, we will come back to the numbers, but I think we have probably around 8 to 10x more sales and commercial coverage than OneWeb has today. It's a natural than a fast-paced growth can benefit from that and those longstanding customer relationships. And we actually also see customers ask for both. So when we're out there, they actually want to hear about both. They want to hear about what we can do in high-peak, high-capacity demanding sites, but they also want to hear what's the new opportunities with the constellations. So we actually have customers who want both. They don't want to replace. They want both. On cost, a bit more traditional, but not traditional in a way that this is about avoided cost in terms of building up the OneWeb organization over time. Whether it's in regulatory where the team will be larger, whether it's on development on land and ground infrastructure, we'll be able to actually help each other by leaning into Eutelsat's organization. And then importantly, CapEx synergies, which I think you'll also understand much better once Pascal and Massi has been through how we think about Gen 2. But rightsizing Gen2, knowing that you'll be able to leverage GEO capacity for high-capacity demands and also rationalizing the GEO fleet, knowing that you actually stand on top of a strong constellation network, both of those actually come up to around EUR 80 million in CapEx synergies coming in from year 1. So those are the synergies that will start coming in already next year, and that has to do with also Gen 2 starting to be built, which is why the timing is now and the timing is right. ESG is actually an important element also for both companies, and I think it's an area where I don't think we're as complementary because, there, we're actually 100% aligned. Both of our companies, through our main business, address the digital divide. We do it with our launch of capacity in the connectivity space with the KONNECT VHTS, which we cover in Europe and Africa and covering quite a lot of the white zones or blank spaces on the map in terms of digital divide. And OneWeb, you will see that later, is right now addressing unconnected communities in Alaska and Canada, so very much about bridging the digital divide. It's core to our business. It's core to bringing equality into the world. But the other part, which is also important, and those of you who follow discussions about space debris and sustainable space, we'll also know that, that's an area where Eutelsat and OneWeb together can take a very strong stance. GEO companies have been in this for quite some time, but the bigger issues, when you look forward in terms of sustainable space, definitely is created by the constellations in low orbit. So addressing sustainable environment in space and on the ground is super important. With that, I think you're all curious to hear a little bit about the market we're addressing, the market opportunity will. So Jean-Hubert, our Head of Strategy and M&A, will take you through a little bit about the market we're addressing. And then Neil will come and tell you more about OneWeb. But over to you, Jean-Hubert.

Thank you, Eva. So indeed, a few words about the markets. And you said it earlier, Eva, we see the market -- the connectivity market really at an inflection point with a massive growth opportunity ahead of us. So it's important to understand why this is, I think, the first question, and there are really 4 major changes happening at the same time in our market. First, starting on the left, you see that with HTS, high-throughput satellite, and very high-throughput satellite, plus the connectivity added by LEO constellation, we will be able to respond to demanding use cases in terms of bandwidth, like bridging the digital divide over a country like Germany or delivering massive capacity to several cruise ship in the same area at the same time, things that we cannot do today. In addition, that also means that distributors that were so far neglecting satellite because of lack of scale or that we're using it as a last result, and that includes large telcos, are now clearly adopting it. The second point on the right is that we can deliver that capacity at dramatically reduced costs. For instance, OneWeb Gen 2 will be 5x more capacity effective than OneWeb Gen 1. And the costs that we see are nearing terrestrial connectivity. I think this is very important, maybe not matching, but nearing. That means that price will no longer be a barrier to adoption for satellite. The third element, of course, latency. Latency below 100 milliseconds mean that satellite connectivity can now be seamlessly integrated within enterprise, IT and telecom networks, like any other access technology. This is a major step versus today. And the fourth element, this is about the terminals. The cost, the design and, very importantly, the ease of installation of those terminals is really a step change versus today, meaning that this is again a massive simplification. Now when you add those 4 elements together, you see that barriers to adoption in satellite connectivity that still exists today very much will be rapidly removed. And when you add to that government policies that will encourage strongly the use of connectivity for everyone, including universal service obligation, that we will drive market expansion at a very high rate versus today. So this is what you see, in fact, on this slide in numbers. You see that we've used the Euroconsult as a reference. We do our own studies very much in detail, but we used an external source here. Euroconsult, as a matter of fact, is conservative versus many other estimates that you can see in the appendix. But so we took that one precisely because it's conservative. And what you see here on the left, the total market is expected to more than triple over the decade to $15 billion. This is a 14% CAGR growth. And on the right, you see that NGSO, that's non-geostationary and within that critically LEO will take half of it. So we'll capture more than the fair share of the market growth to reach roughly half of the market -- total market by the end of the decade, and this is at a growth of 37% CAGR, 37%. I would like to add that GEO will as well grow, not at the same pace, obviously, but at 7%, which is quite good. And why is that? Simply because GEO will as well benefit from some of the changes I mentioned earlier. And in fact, you'll hear later from Eva and Neil many cases where customers are wanting GEO and LEO. So GEO will benefit from the growth and the new phase of growth as well in the market. Now specifically, looking at verticals, where will the growth come from. The opportunity really spans across all verticals with 4 pillars of roughly the same size. And everywhere, double-digit growth, as you can see. In fixed data, to start there, which comprises backhaul -- cellular backhaul and enterprise, the growth will be driven by cellular network expansions, driven by stringent regulatory requirements and, of course, the deployment of 4G, 5G and beyond other generation of cellular. Just to give a number here, we expect that the number of backhaul site will move from 43,000 in 2000 to roughly 70,000 in 2030. And the provisioning per site will roughly be multiplied by 3 or 4. It's around 5 to 6 megabit today and will be more than 20 megabits in 2030. In the government segment, the combination of budget increases and the fact that many applications that are pretty bandwidth hungry, including drones, communication that moves, military aircraft, will actually drive a significant growth. Plus in this segment, satellite remains and will remain preferred over terrestrial in many instances. In mobility, the growth is really driven by a combination of multiplying factors. Take Airbus. It's really the combination of growth of global fleet, plus 3% CAGR. The penetration of in-flight connectivity within that fleet, it's only 35% roughly today. So significant growth potential here. And of course, the growth in usage per plane. Typically, in business jet aviation, and this is not from studies, this is from customers, maybe Neil will talk about it later, we think that gross provision per plane will be multiplied by 5 over the next 5 years. Similarly, in maritime, you have the same effects. And in addition, you see connectivity treated like a profit center in certain segments like cruise. And again, in cruise, we hear directly from our end customers that the increase of provisioning per vessel will be significant. So they are wanting to have 200 gigabits per large vessel today to 1 terabit per vessel, in fact, as soon as possible. Finally, in consumer, the growth will be driven by the fundamental need for Internet for everyone, universal's -- by universal service obligation. And again, the increased convenience and affordability of the service. Again, many see a higher, sometimes much higher potential than we see here in those numbers. And this is the case both for B2B, which is 70% of the market opportunity according to Euroconsult, but as well the case for B2C. Lastly, a very important message is that the growth will not stop in 2030. The growth potential goes well beyond that, and it's really the combination of 2 elements. One is the growth in current usages and one is future usages. Let me first take current usages. We will be far from saturation in 2030, 3 examples of that. Cellular backhauling, 1/3 of cell sites will still be in 2G and 3G and, of course, waiting to be shifted to 4G and beyond. When you know that 2G and 3G sites consume roughly between 1 and 4 megabit per site, while 4G consume between 8 and 10, and this will be beyond for 5G, you see the multiplication potential. Another example is commercial aircraft where, again, up to 40% of the fleet will not be equipped with in-flight connectivity by that time. And the last example is consumer broadband. You see that we estimate that penetration will be at 0.5% of the global market. When, and we have shared that at length, when we do think that the total potential is at least 1% to 2%, 1% to 2%, which is if I take the midpoint, 3x more in that segment. And second, when you take the new usages, many new usages across those segments, some, of course, we'll have to see as we go, and some that are already in infancy and that we understand. Two examples, again, route optimization in mobility, route optimization for planes, for vessels, in particular, to optimize routes real time and to optimize energy consumption. This is very important as anyone can understand, and this will consume massive real-time data. That's one driver. Another element, of course, is land mobility. We'll have more connected cars. Those connected cars will drive autonomously, not thanks to satellite, by the way. But occupants will need to be occupied with entertainment. And those cars will be -- will need to be maintained. So on the connected car market, there will be as well significant growth going forward. So next, if I summarize this market section, we are really at the eve of a massive market growth. It's driven by factors and evolutions in our market that are identified, that are certain. And the growth is expected well beyond 2030 through to 2040 and beyond. The growth, as you have seen, it concerns both GEO and LEO, but will be particularly dynamic in LEO. And in LEO, you have today 2 players, Eutelsat and Starlink. Maybe 1 more coming later, maybe 2 more, but LEO is [ cast ]. So I'll now pass on to Neil to explain precisely why OneWeb is a unique asset to help Eutelsat capture the growth.

Good morning, everybody. The combination of -- there we are. The combination of OneWeb and Eutelsat creates a compelling proposition for customers and a strong value creation story for investors. I have led OneWeb since November 2020, and I spent a lot of time with customers around the world. And I know the impact and also the value that OneWeb is already making to customers, whether they be civilian or indeed governmental. The combination of OneWeb and Eutelsat is underpinned by strong strategic and industrial logic, and it is well placed to address a significant growth opportunity, which you just heard Jean-Hubert outlined. Now as a privately held company, we've been very, very focused on execution. So I'm very happy today to be able to share more about the progress we've made to date, the commercial opportunity we have in front of us and also why LEO and GEO combination is such a compelling proposition for customers. OneWeb has unique assets, speed to market and a track record of execution. There are only 2 commercially available LEO broadband constellations in the world. OneWeb is one of them. Over the years, we have deployed $4.5 billion of CapEx, and this has enabled us to deploy 2/3 of our constellation, develop a global network of ground stations and secure spectrum priority rights, which is something I will come back to later. Very importantly, we have built a highly skilled organization, attracting hard-to-find industry expertise to our mission. And of course, if you're going to build a global constellation, it's extremely helpful that we have secured the support of some highly influential global stakeholders. Our network is expected to deliver global coverage with 648 satellites, with 1.1 terabits of sellable capacity by the end of next year. Importantly, fewer satellites equals less CapEx. Our low latency capacity, which is 84% focused on land, is targeted at fast-growth markets. The network is live. We are serving customers and generating revenues. What we are also now seeing is a rapid acceleration in network usage from our first customers. Our deal pipeline stands at $2.7 billion, and we have more than 150 customer trials underway. To summarize, OneWeb has unique assets, speed to market and a strong track record of execution. Combining this with Eutelsat's scale and reach has clear benefits for both companies, but particularly for our customers. OneWeb has priority rights over spectrum. The network is designed to use Ka band to connect from the satellite to the ground network and then Ku band to connect to the user. We have the highest priority in Ku band globally. This is really important because it means every other operator needs to coordinate with OneWeb to avoid interferons. And critically, since Ku band connects every user terminal, any coordination becomes highly complex. Remember that we are 1 of only 2 LEO broadband networks in operation, and spectrum rights is on a first come, first serve basis. So what does this mean in practice? With low spectrum priority, the operator has to shut down satellites interfering with us. It means they require more satellites to provide continuous coverage, meaning greater complex and operational complexity. In the U.S., we have a spectrum coordination plan with Starlink to enable our current and future constellations to coexist. So OneWeb's priority spectrum requires new entrants to coordinate with us, making them operationally more complex and much more capital intensive. OneWeb has early mover advantage. We expect to deliver global coverage by the end of next year. Our approach to executing on this strategy is to progressively turn on coverage across the world's continents, oceans and airspace. We already operate the second largest constellation in the world with 428 satellites currently in LEO orbit, which is about 2/3 of our constellation. We are serving customers from the North Pole to 50 degrees North. That's about -- that's roughly the U.S.-Canadian boarders to the North Pole. Two more launches are required to cover 25 degrees North and South, and we are on track to complete both of those by mid-December. All remaining launches are contracted. And critically, all the satellites are already manufactured. Within 6 months, we expect to complete the constellation deployment and in 15 months global commercial coverage. We are confident in this plan, as we've built an organization that has demonstrated a culture of resilience and rapid execution. Since November 2020, in the midst of the global pandemic and also through 1 or 2 geopolitical issues, we have constructed and deployed 2/3 of the constellation. We've built the operational infrastructure, the ground network, fleet management, operating systems and, importantly, the organization to manage it. We've secured funding to complete the GEO network, raising $2.7 billion and attracting global strategic shareholders. We've also transitioned the business from a technology project to a commercial enterprise, as we started to serve customers across multiple markets and geographies. We have built a channel distribution network of 44 partners in strategic markets and geographies. In just 20 months, we've built an organization with a strong culture of rapid execution. Our Gen 1 network is live, and we are almost there to complete the global constellation. Just 5 more launches, all of which are contracted, and 2 of which are on track for completion by mid-December. All the satellites have been manufactured. Equipment for all our ground stations has been ordered, 13 are fully completed, and we expect to have 26 completed within the next 6 months. 44 distribution partners have been signed up, most of whom are leaders in this segment and the geographies they operate in. Gen 1 is live, fully funded and close to completion. Now importantly, we are not undertaking this endeavor alone. OneWeb has made a strategic choice to build a network with established industry partners, also turning many of them into customers. We now have 3 launch providers, and you will see further announcements on additional providers in the coming weeks and months. We have options on approximately 90% of our launch requirement for Gen 2. On satellites, we have manufactured 100% of those required for Gen 1, and our management team sits on the Board of the manufacturer, a joint venture with Airbus. Similarly, on network and user terminals, we have diversity of supply, and we are working with the industry to meet multiple use cases. Massi will cover this in more detail later. Our technology is underpinned by industry leaders. Many of those industry leaders are now our customers, relying on their own technology and ours to serve their customers. So let's spend some time in our target markets, the go-to-market strategy and also the extensive and high-value distribution network we have built. Our proposition is simple. We're here to help our partners serve their customers. We are not seeking to disintermediate them or take all the margins from the market. Our distribution partners are on the ground day by day, serving their customers, having built relationships over a long period of time. They have a deep understanding of their end markets, so this not only enhances our reach into the market, but it also gives us a very valuable feedback loop. We believe this will drive rapid adoption and market penetration and, more importantly, profitably expand our business. In total, we have signed 44 distribution partners in 20 months, some examples of which you will see on this exhibit. We have deliberately targeted specific distributors to maximize market and geographical coverage. For enterprise, you can see some of the leading names here like in AT&T, Airtel and Orange. For government, we deal directly with governments, but also with distributors whose role is to blend services for specific government applications and use cases. We also acquired a specific entity to enable us to do business with the U.S. Department of Defense. This is called OneWeb Technologies. In aviation and maritime, we have signed partnership agreements with leading market participants who cover the majority of their respective markets. We have built a formidable expert distribution channel. These distributors are on the ground with customers every day, and we benefit from their unique market access and knowledge, which would be very hard to replicate. OneWeb is a live network with live customers. In Alaska, the largest state in the United States and one of the most poorly connected, is a market we started in. To drill down on how we go to market, we have a ground station here, 5 local distribution partners and a regional office to help us unlock demand. The demand is considerable, as there is little or no viable alternatives for reliable connectivity. Today, we have deployed more than 70 sites to support local services, businesses, mines and schools. Now remember, our model is one to many, not 1:1. One site can serve an entire village of 400 people, a whole mine or a hospital. We expect the pace of penetration to continue, working in partnership with our local distribution partners. In this remote and challenging environment, we have learned a lot and program OneWeb's ability to unlock the opportunity in these kinds of locations. We think it's a great proof point for other parts of the world, and it's also enabled us to grow our operational chops, supporting communities day by day. We have a strong demand where we have coverage, and we are building demand ahead of where we have live coverage. The way we showcase this new technology is by show and tell, supporting customer trials, and we have over 150 customer trials installed conducted by 27 distribution partners. Now these customer trials are invariably connected into the network of the distribution partner. The number of trials has increased 50% since June, and this allows us to build out and qualify our pipeline. We can see the effectiveness of the trials, as usage of the network has grown 5x since April. So let me give you a quote from a customer, as she is a customer of Hughes at an Air Force base in Greenland. The testing has demonstrated the ability of emerging LEO networks to dramatically improve communications to areas that have been traditionally -- have traditionally been extremely difficult to serve. The residence at Thule, this is the Air Force base where it's installed, have been thrilled with both the stability and performance of the network, as they've used it to connect with family, friends and colleagues around the world. We have quickly built a significant pipeline, which stands today at $2.7 billion, of which $600 million represents signed orders. This $600 million is equivalent to around 7% of our sellable capacity. To give some sense of depth, on a risk-adjusted basis, we assess this to be about $1.9 billion. The pipeline is balanced geographically, showing strong demand around the world outside the areas we're already operational. We see strong demand across the use cases, where distributors wanting to sell across multiple verticals, laying the foundation for cross-sell and upsell down the road. You will also know that government, which in this context means the military government, at this point, is a relatively small part of our pipeline. While we expect this to grow significantly, the timing is uncertain, which is why it has a low representation in the risk-adjusted pipeline. Finally, you'll see the pipeline is also disproportionately weighted to long-term deals, something we actively encourage. It means our revenue will become highly predictable as we proceed with the rollout of the network. Now these slides have been put together over the last few days. And since these slides have been put together, we've closed an additional $70 million to $80 million of this pipeline. So we're now touching $700 million. It's a very dynamic situation. We're very, very focused on deal and pipeline conversion at this point. Now LEO and GEO is not simply complementary to each other, but there are multiplier together because they expand the use cases in markets that we can serve and target. From a competitive standpoint, Starlink is the only other commercial LEO broadband constellation. And while 2 others are postulated, they are not expected to materialize until late this decade, if at all. Starlink has historically been focused on the B2C market, although there's evidence that they are following us into the B2B markets. While the technology really is very similar, they require many more satellites, which have a shorter lifespan, which means they are much more capital intensive. Additionally, they subsidize every terminal, so they have a very high customer acquisition cost. We, in contrast, make money from every customer we onboard. From a product standpoint, we sell products with committed information rates, underpinned by SLAs, and we believe this is a requirement for the majority of the B2B market. Starlink is best efforts only. Now MEOs fall between 2 stores in that they don't have the low latency of a LEO or the focused throughput of a GEO. Additionally, their ground equipment is very expensive and boggy to install, and we have a lot of market intelligence on that from shareholders around the world. That said, the competition is very strong, and this is why we believe that the LEO/GEO combination is highly differentiated. GEO brings the benefit of resiliency and ability to focus much more capacity on high-density areas. LEO brings the benefits of low latency and ubiquitous coverage. Together, a LEO/GEO combination is very powerful. The combination is not just complementary, but it's a multiplier, enhancing the market opportunity and unlocking use cases that LEO or a GEO network could not individually achieve. Now in summary, we do not believe this is a winner takes all market. We do believe, however, that there will be a limited number of winners. So from a market perspective, first of all, it's a really big market, as Jean-Hubert outlined, and it's growing quickly with significant cash bolus, which means it will undoubtedly attract and is attracting multiple players. However, customers really want choice. I hear this from customers all the time. They really want choice from their providers. All customers, but particularly military, have a requirement for resiliency and redundancy. This means it is not an option for them to have -- it is not an option for them, but a requirement -- is a requirement to have alternate service providers. Finally, in this business of all businesses I've been in, geopolitics really, really matter. A single winner is simply not acceptable in many parts of the world. And at the end of the day, it is a governance that decide which markets you play in because it's a heavily regulated market. And you can see this happening already. That said, there are significant barriers for new entrants. As I mentioned, spectrum really matters. Spectrum really matters. And as I mentioned before, they're not making any more of it, which means -- and given that we have priority, it means everybody else has to operate around us. Speed to market is also very important. It takes 4 to 5 years to design, develop and deploy a LEO constellation, and that is going very quickly indeed. Setting aside the capital requirement, there are real limitations in the market on launch capacity and there's also limitations in satellite manufacturing capacity. To exploit the global constellation, you need access to many as markets as possible. Acquiring landing rights and market access is a time-consuming exercise. It is a governmental exercise. It takes -- it is measured in years. OneWeb currently has market access in 57 countries. Last but not least is the availability of skill and talent. This industry, in some ways, is different from many other tech industries in that the technology and the skills required to exploit that technology are heavily bespoke. And so there's a very limited number of people who can design, build and operate these constellations. So in summary, we have a great asset that is live and generating revenues. We have exhibited velocity, and we've proven our execution capabilities. We continue to win customer trust and build on our deal pipeline, currently standing at $2.7 billion. And as I mentioned before, we're converting that quite quickly, and we will become the only LEO/GEO operator in the world, a proposition which is not additive, but a multiplier in nature because you can simply serve more use cases. And with that, I welcome back Eva to the stage.

Thank you, Neil. What a world win tour through OneWeb and LEO constellations. We're going to try to gather -- try to underpin with some facts and some of our best knowledge of how this 1 plus 1 makes 3, and what's the strength of the complementarity between the 2 companies. First of all, and I think that's -- we touched upon it, this is the natural next step for Eutelsat within the connectivity world. We started our strategy of the telecom pivot, focusing on building a strong second leg in connectivity a few years back, and that followed with initial investment in OneWeb now 18 months back, built it out with a distribution partnership and some joint work on both tech and regulatory work streams over those 18 months. So this is a perfectly natural step of saying we now know this asset really well. We know where OneWeb is going. You've just heard the story about how far OneWeb has gone over the last 18 months, and now is the right time to move on. So this is the right window of opportunity. We highlighted earlier that OneWeb needs to accelerate the commercial ramp-up. Now we are live in 50 degrees North. But in a very short time, this will be a global coverage. And going from Canada, Alaska, to full global coverage and ramping that up fast needs to happen with a lot of speed, a lot of agility, but it also takes more people. It takes more people to cover the globe. It takes more people to talk to all these customers in individual verticals, and that's something we need to do together. And we see actually customers asking for both, so why do we need to come with both teams when we can do it together. We also need to minimize the risk of implementation in doing this in terms of both OpEx and CapEx, and the timing is right for thinking this into the CapEx game. The timing is right to do this together. So what the customer is saying? Let me start, and Neil, maybe you will complement me after, but customers want both. They want the coverage. They want the global coverage. They don't want to know when the GEO satellite is not providing enough download because you get too North, but they also want a lot of capacity. When you talk to a cruise ship, when you talk to a military camp, they want to be able to serve everybody also in the peak times. They want resilience. Military guys wants back up. They want resilience. They want to make sure that it's always available, and they want it easy. They want a one-stop shop to fit it all. And then, of course, they want that's the lowest cost available. And right now, the lowest cost available is the combination of the 2. But what are you hearing when you travel out there?

Yes. Just -- I mean, just a couple of points to build upon there. So first of all, as Eva sort of telegraphed earlier on in the presentation, Eutelsat has a go-to-market organization of around 200 to 250 people. We have a go-to-market organization of around 30 people, right? So it's a simple scale player, which we can take advantage of. As we access these, we can get to market much more quickly. And importantly, anybody who has run a B2B business knows. It's not just a question of having a sales person. It's a question of how rapidly they can get up to speed. And generally speaking, it's 6 months, right? In this industry, it's intensely because it's quite a technical sell. You really need people who actually understand the market. And the fact that Eutelsat has a whole load of them, and I don't, seems to me to be an obvious benefit. And we're obviously -- we're already seeing the benefit of that. The users at sales team or at conferences are already speaking on our behalf. And so we're delighted to see that. I think also from -- I mean, it's common sense as well, there is a duplication in sort of -- in key functions. And also as we go down the road, OneWeb just does not have to build these functions out to the degree that we would have done on our own. And I think the final point I'd make is, and I'll be quite delicate in how I put this, when I started in OneWeb, we were very much price takers from our vendors. We are price takers, combined, and we've already seen some -- Eutelsat as a shareholder has been very helpful and helped us with some of our vendors. So we feel very confident in not only having a much stronger voice with some of our vendors, but be able to negotiate much better contracts with them as we go forward. But I just want to return to the first point. Every customer that I have spoken to, and I've spoken to almost all our customers since we announced this merger, are delighted in this merger because it makes a lot of sense for them and enables them to serve their customers better in a much more compelling way. And that includes distributors who maybe working with other LEO companies around the world. They are delighted about this. They want this to happen as quickly as possible.

So what they're saying is tell us how you're going to build LEO and GEO together, how is that going to come into 1 seamless product for me today. I could just buy some capacity here and buy some capacity here. And sometimes, when one works out, switch to the other one. But how do we build this into a seamless integrated product? That takes a little bit of time. And Pascal and Massi will come back to it because, today, it's clear that we can co-sell, cross-sell the product, and we'll start doing that. We've started doing that already, and now going out in the world. But we also wanted to be built into the same antenna, the same modem, and that's something where, at least when I discussed and probably all to you with our suppliers of terminals and antennas, we say, "Guys, start thinking about this. This is what we want to do." And they're starting to think of that together with us. We can move fast forward to a, what you call, smart routing. So you can send one or the other one when network works. But we do want to move into 1 antenna and 1 modem over the next 3 to 5 years. How fast can that go? Well, of course, depend both on our vendors and technology, but we are already starting to experiment with it in some areas. So some of the proof of concepts are coming up. Now it will take a bit of time for the proof of concepts to be into cost-effective products, but we are starting to do that, and we can see that service coming in over the next 2 to 3 years. And that's why we need to be one technical organization to get this focus.

Yes. I would just add, commercial integration obviously is going to take place quickly and it already is. Full technical integration will take longer. What I would say, though, is that the user terminal manufacturers out there, they have a very strong vested interest in making sure they get to these combined terminals very quickly, not least because the other players out there, generally speaking, are vertically integrated. So we are at the market for combined LEO/GEO antennas. And so that is why we've been actually -- we've been testing prototypes already that we will be pushing extremely hard to get into production as quickly as possible.

So which customers are actually looking at this? These are some of the verticals and some of the use cases Jean-Hubert talked about how that adds up in the total market. But let's just talk a little bit to what we are actually seeing. Across customers, we see a lot of these use cases. And I think if I dive into a few of them in maritime with different value propositions. Sometimes, it's about lowest cost. Sometimes, it's about resilience. Sometimes, it's very much linked to throughput and flexibility of throughput, but all of them have elements where we can address them very strongly. We see right now a very strong demand in maritime. Maritime has a big need for the big cruise coverage. Obviously, they want to be able to be connected the whole time. But also, especially when you talk about the cruise part of the maritime segment, big amounts of capacity. The times where the cruise lines could attract people because they were disconnected from the world has gone. Now people expect to be able to watch their favorite Netflix series, even if they're on a cruise ship. So they want big amounts of capacity. Some of the same thing is true with government. When they have a military camp and they have a lot of soldiers, they need to connect them. And a lot of these people are saying today, "We simply can't recruit people if we don't give them connectivity. We cannot get people neither the military [indiscernible] if we don't give them some element of connectivity." So connectivity becomes important, and that also means that connectivity in densified areas like a military camp or like a cruise ship is very important. Then you have other uses like the backhaul, which is somewhat more cost-sensitive where it will be more of a cost case with some of the telecoms. What are you hearing?

Yes. Let me pick on 2 here, right? So aviation is something that we -- all of us understand because all those flying airplanes, and all of us are condemned to the absolutely lousy connectivity that we all experience, whether we're flying across Atlantic or in Europe, et cetera. And the point about aviation is if you think about an airplane, the cockpit of an airplane is almost always going to be a GEO play. It's kind of mandated by safety features and so on and so forth. But at the back of the airplane, or whichever compartment of the airplane you actually fly in, all of that is going to be basically LEO going forward, right? So think about it, safety, all that kind of stuff is going to be GEO-mandated. The back of the plane, all about making life better and having a better customer experience is going to be LEO. And that is why LEO and GEO makes such obvious sense, right? That is it, in one proposition when in an airplane. It makes it extremely clear. Now government, oddly enough is, in some ways, it's the similar outcome, but for different reasons. Governments have spent -- and I'm talking about military government here, has spent fast amounts of money on connectivity already. They have an enormous amount of infrastructure already deployed. They are not going to throw away that infrastructure overnight, but they desperately need LEO connectivity. What is the point of spending billions of dollars on an aircraft carrier if you can't see over the horizon, right? So this is why, particularly the many militaries around the world, are very, very focused on deploying LEO connectivity as fast as possible. And today, the biggest militaries around the world, they buy connectivity from everybody. They buy connectivity from every GEO satellite provider. They will buy connectivity from every LEO satellite provider, and they have told me that is the case. Over to you, Eva.

Yes. So we have a few pages. I'll not dive into all of them in detail, but giving you a little bit of the feeling for what's the feedback we're getting today when we start talking to customers because that's what we've been doing for the last couple of months, started talking to some of the maritime customers. Maritime, both in cruise and in commercial maritime, is extremely demanding. You've even seen shareholders stepping into Eutelsat with that background because they really want to explore this area more. It can be for autonomous vessels. But definitely, in the cruise market, we see right now quite an intense requirement. I think, Neil, you talked a little bit about aviation. We also had a test recently in aviation, another area where we see customers wanting both.

Yes. We've actually tested on a 777. It's actually, I think, on our website. It's a public announcement. We've tested the connectivity on 777. Massi can double click on it a little bit later on. We had really good results. We are working very hard to productionize that as rapidly as we can. In the business jet aviation market, we're working with 2 partners there. We're working specifically with them on user terminals, which fit in the tail fin of a business jet. And obviously, the smaller the terminal, the bigger the market. So we expect -- and also that has direct read-through directly into military markets.

Yes. And military and government is an important market. As you know, it's something that all commercial satellite players are playing. And U.S. DoD as well as European militaries are very interested in this, especially because of the opportunities of low latency in military. Those 500 milliseconds actually make a big difference when you talk about a weapon, maybe a little bit less when you talk about providing connectivity in camps to people, but it is clearly a very hot market right now also in the military. And I think there, we have a little bit of the help from the Russian-Ukrainian crisis talking about geopolitics and really getting something like the satellite capacity well positioned within their arsenal of things.

Yes. Just to add on that point. Obviously, for the military, secure comms is absolutely paramount. And so they layer that -- we have very strong encryption on our network, but they want to put their own encryption over and above that. You can't really run encryption over a GEO network. You need low latency because it puts a tax on the network, and it breaks the encryption protocols. So low latency will become incredibly important for encrypted comms for the military as we go forward, as well the resiliency of the network because it's very hard to jam our LEO network.

We have another 3 cases, but I thought we'd actually want to move to hearing from the engineers themselves, as the space is going to be every engineer's dream and understanding how the network works and also how we'll build the next generation is key. So I'll leave it to Pascal and Massi for the technical part.

Okay. Thanks, Eva and Neil. So hello, everyone. You know Eutelsat, well, I think, for years. You know our 36 satellite fleet, the service we provide to the market and our extensive ground network. You certainly heard about the recent launch of our KONNECT VHTS satellite early September, which will bring a massive 500 gigabit per second Ka capacity over Europe and the Middle East next year, obviously. And the soon-to-be launched multimission 10B satellites, which will bring additional capacity for connectivity in Ku band over the same region. You may be less familiar with low earth orbit constellations, so let me hand over the floor to Massimiliano, who will present to you what the first generation of OneWeb is all about. One of the two LEO broadband constellations already in service, so that you feel more comfortable with LEO concept. We'll show you a very short movie explaining how LEO Gen 1 operates before we start talking about the much more powerful second generation, which will come in a few years. Massimiliano, up to you.

Thank you, Pascal, and good morning, everyone. I'm really happy to share with you the details of our Gen 1 constellation and the future Gen 2 constellation. Before I talk about the specifics of our technology, I would like to share with you a brief video to show you how OneWeb's LEO system currently works. It's already live and delivering the service. Let's get to the first challenge and see if the video works. Sound? [Presentation]

Here we are, the window works. Then I'm going to start by introducing Gen 1, some of the key features of the network and how our user experiences has proven performance. Gen 1 is an innovative LEO constellation. It's currently deployed and connecting the customers now. Gen 1 is built on a robust 4G core network, which we developed with industry leaders like Qualcomm and Hughes. Our satellite is expected to have a life span of more than 7 years. This makes our Gen 1 system highly economical and compares better to other LEO broadband constellations. Our satellite failure rate is below 1%, and which is one of the best in the industry, including Starlink, the only other LEO broadband constellation in orbit. Obviously, the more satellite fail, the more you must replace them. And clearly, there is a cost impact here. Just as an example of the strength of this design, a variant of this satellite has been selected by the U.S. Department of Defense. Our constellation has higher look angles. This means better line of sight and more geographical coverage and access to customers in more locations. This is quite an important feature of Gen 1. As a CTO of the company, I could talk a lot about the technology, but the customer doesn't care about how shiny is the satellite, how shiny is the network. What matters is what is the customer experience. The constellation is effectively a 4G LTE network, but delivering from space, so it can reach where there is limited connectivity or no economically viable alternatives. Its resilience and low latency support application like Teams calls, seamless Internet browsing, corporate network extension and streaming. Gen 1 is actually delivering an equivalent performance to Starlink, reaching download speeds of about -- of up to, sorry, 195 megabits per second on the upload and 32 megabits per second on the download. However, differently to Starlink, and together with our distribution partners, we provide a fully managed service, which means that we can guarantee the quality of service contractually. Again, this is quite important. In summary, and this is the takeaway, this constellation operates like a 4G LTE network,and deliver -- but deliver from space. It provides a robust and committed service, not just best effort, and we have built it with longer lifetime, fewer satellites and lower fairly rate. This makes it CapEx efficient. As Neil said, OneWeb is no longer a technology project. It is live and serving customer today. We have completed our first phase of deployment. We are serving customers about 50 degrees North. We are doing this in locations where our customers have been deprived of basic connectivity needs thus far. And it is unlikely that this area will be connected by fiber in the near future. Let me bring you some examples. We are successfully delivering community WiFi. We are providing connectivity for mine sites and business continuity service, among others. We are deploying in remote locations like Alaska, Canada and Greenland. But while we are launching more satellite, we are also looking ahead, readying for a much wider array of use cases that will go live in the following months. Firstly, let me give you some example of real-life application of OneWeb. On land, we have demonstrated the ability of Gen 1 to support land mobility use cases. Together with U.K. Space Agency and European Space Agency, we are connected a car to a LEO and to a GEO simultaneously on the same antenna and demonstrate that the system can also do backhauling of 5G, and I think we were the first doing that. This comes of the post use cases is highly suited for government or emergency service and expect to be ready by Q1 next year. There is also a significant opportunity in providing seaborne connectivity. We have conducted successful trials, providing seamless connectivity for video calling, streaming and gaming to support leisure and commercial shipping. Our users terminals install are expected to start early next year to support maritime use cases. Again, here, we will provide LEO/GEO connectivity on ships. And finally, as Neil said before, we were the first in the industry to demonstrate the use of flat panels on a large Boeing 777. We have delivered over 260 megabits per second of low latency connectivity with cruising aircraft. This install expect to start in the second half of next year to support airborne connectivity. Those antennas, we will have 2 variants: 1, LEO only; and the second one, LEO/GEO, starting in the second quarter of next year. We have covered the constellation and the way users are connecting to it, but another element -- a key element of the network, other user terminals. The user terminals are critically important. These are the device in the hands of our customers. Customer requirements vary per use case and segment. They require different type of power, weight, size and performance. Therefore, we are building a wide portfolio of user terminal to suit connectivity demands of our customers, and this slide shows you the road map as you see. Between now and the end of next financial year, we expect to have more than 12 different types of user terminals for our customers to choose from. And as part of this strategy, we have built a diversified pool of vendors to respond to customer demands and build resilience into a critical network component. We think that many is better than one because customer wants choice. I will now change the direction and look forward to Gen 2, its key feature and the revenue potential it will unlock. OneWeb has learned a lot from operating Gen 1 constellation, and Gen 2 builds on that. This is quite important element of Gen 2. OneWeb is designing Gen 2 to be modular and adaptive. So what does that mean? Gen 2 satellite and network will continuously evolve and adapt over time to constantly follow the evolution of the market demand. This means that we can add capacity, functionality and features at a much lower capital cost. To put it another way, we won't need Gen 3 or Gen 4. Gen 2, by design, will open up a new range of market -- of revenue opportunities for us. One, it will include features like optical satellite links, which reduce the capital cost to fewer ground station and satellite -- and higher network utilization. It will improve performance and increase our addressable markets. Two, by design, it will be backed by much smaller user terminals and terminals compatible with GEO, again, opening up new revenue opportunities for us. The smaller the terminals, as Neil said, the more you open market opportunities. Three, and again, this is important, it will go beyond just connectivity. If we further open new markets such as delivering position navigation and timing, and such capability is extremely important for -- to government for critical infrastructure resilience, and this is just one of the examples of the additional path that we'll embark on Generation 2. Finally, as Eva and Neil mentioned earlier, LEO/GEO is going to be a game changer. Naturally, Gen 2 will be fully compatible with GEO technology, increasing resilience, flexibility and availability, and expand the available option to our customers. In summary, Gen 2 will build -- builds on all our Gen 1 experience. It makes delivering connectivity cheaper and gives higher performance to customers. It enables us to deliver more use cases and expand the market opportunities. Now Pascal, what are your views on Gen 2?

Thanks, Massimiliano. So let's continue on the Gen 2 benefits. Gen 2 will have a much higher capacity than the first generation estimated at about 5x the capacity of Gen 1. It will have native LEO/GEO compatibility in the space and in the ground segments as well as for user terminals. Thanks to its more powerful satellite capacity, users will benefit from higher performance services. The satellite will have a life expectancy, sorry, of about 10 years, longer than the Gen 1 present lifetime, leading to an evolving system where we will upgrade the future renewal satellites with additional features and insert them into the orbital planes or add more satellites if capacity increase is needed, thus avoiding a disruption of generations. Finally, the innovative design should lead us to a lower sellable capacity cost per gigabit per second. Eva said it earlier, customers want the best of both worlds, so they want the benefit from low latency enabled by LEO constellations, thanks to their proximity to the earth, and they want also the benefits of GEO satellites with very high capacity concentrated on local geographies and low sellable capacity cost per gigabit per second. The reality of the demand is made of high volumes of connectivity needs concentrated in specific geographical areas. For example, maritime ports, airports, maritime and aero flight routes, but also business city centers. LEO constellations can accommodate local demand's peaks, but at the cost of deploying significant capacity around the globe. Conversely, GEO satellites enable to target capacity over high demand areas. By the way, a great part of the Internet traffic is coming from video, which does not require low latency and is monodirectional. Combining both LEO and GEO will definitely help us optimize the production tool, enabling higher fill rates. Building LEO constellations is not straightforward. If we were to start from a blank page, we would not be able to benefit from all the investments already made by OneWeb in Gen 1. So let's look at it from a Eutelsat investor perspective. First, the reuse of Gen 1 infrastructure, for what concerns the relevant part of the systems and the ground segment, should represent about $500 million to $600 million in cost avoidance. Second, Eutelsat will benefit from all the know-how developed by OneWeb over the design and deployment of Gen 1. Such know-how over multiple years, in addition to the expertise that we will bring with the Eutelsat team, is estimated at about $600 million to $700 million worth of knowledge and experience in LEO constellations. Last but not least, we will obviously benefit from the growth into using Ku and Ka frequency filings, which rank high in terms of priority, meaning that the other constellations with lower priority filings will have to coordinate with us and not the other way around. This is estimated to have a value of about $400 million to $500 million, according to external studies. In summary, the estimated saving is between $1.5 billion to $1.8 billion compared to a new entrant. Gen 2 is de facto derisked, and it secures the customer base of Gen 1. As a final note, let me recap the 4 key messages we have for you today. First, Gen 1 is a proven technology already serving customers. Second, Gen 1 experience and combination with GEO will bring strong cost advantage. Third, Gen 2 will open additional market opportunities. And fourth, CapEx will be reduced post Gen 2 deployment. So thank you for your attention on this Gen 1 and Gen 2 Section 5. We will have now a short break of exactly 15 minutes, so we'll resume at 35 with the presentation of Section 6.

Thank you.

Thank you. [Break]

Okay. And welcome back. I hope everybody got a little bit of coffee and cookies, because we want to move on to the next session here, where we give you a little bit about how does all of this network technology, customer vision actually come together in a set of numbers. And we want to start out -- we want to build this up because we want to start out giving you just a few bullet points on the Q1 of Eutelsat, which came out this morning as well. So Sandrine will just take you through the highlights. We won't bore you because it's pretty much as expected. But that's one important building block. Then Srikanth will take you through the next important building block on OneWeb and where we are here in terms of building up OneWeb. And then I'll come back and we'll talk about the combined financials of the OneWeb plus Eutelsat. But Sandrine, first of all, how did our first 4 go?

Well, thank you, Eva, and good morning to everyone. For those I have not already met. So I will start with a quick reminder on the key financial metrics of Eutelsat on a standalone basis, using our June 30, 2022, figures. So our backlog stood at June 30, '22 at EUR 4 billion or 3.5 years of revenues, broadcast accounting for 62% of it. Revenues were at EUR 1.152 billion, and they landed comfortably within our guidance for fiscal year '22. We've reported a 74.8% EBITDA margin, among the highest in the industry, as well as a very strong cash generation with discretionary free cash flow reaching EUR 460 million or 38% of revenues. Fiscal year '22 was another year of strong execution of Eutelsat's cash generation financial strategy. Our outlook for fiscal year '23 and fiscal year '24 stands as follows. Our revenues for fiscal year '23 are expected between EUR 1.150 billion and EUR 1.180 billion at a rate of EUR 1 for USD 1. In fiscal year '24, we see our return to growth. Our cash CapEx will not exceed EUR 400 million in fiscal year '23 and fiscal year '24. And finally, we expect to generate an average of EUR 420 million as discretionary free cash flow over the next two fiscal years, fiscal year '23 and fiscal year '24. We take the opportunity of this strategic update to release today our fiscal year '23 Q1 figures. This quarter, as already mentioned notably by Pascal, saw the successful launch of KONNECT VHTS paving the way for connectivity-driven return to growth. Our total revenues for the first quarter stood at EUR 287 million, stable on a reported basis and down by 4.5% on a like-for-like basis. Revenues of the 5 operating verticals stood at EUR 291 million. They were down by 4.3% on a like-for-like basis, in line with the midpoint of our full year objectives. Now looking at each vertical. First, starting with broadcast, 59% of group total recorded revenues of EUR 170 million, down 7% versus last year. They reflected mostly the carryforward effect of the partial renewal of capacity with NISAT at 7 and 8 degrees West in October 2021. Excluding the effect of the 7 and 8 West, revenues were down at a low single-digit pace. Data & Professional Video, 14% of group total, saw revenues of EUR 41 million, down 2%. Professional Video, which now represents less than 1/3 of revenues for this application, faced a mid-single-digit decline, while Fixed Data revenues were in slight decline on the back of improved volume trends which are now offsetting most of the negative impact of competitive pressure. Government Services, 12% of group total, saw revenues of EUR 35 million, down 18%. This reflected mostly the negative carryforward effect of fiscal year '22 U.S. government renewals, only partially offset by contribution of EUTELSAT QUANTUM, where most of the incremental capacity is now booked in the mobile connectivity vertical. On a quarter-on-quarter basis, revenues were down by 8%, reflecting the transfer of sole capacity on new EUTELSAT QUANTUM from the government vertical to the mobile connectivity vertical. The quarter delivered a continued robust double-digit growth in fixed broadband and mobile connectivity. Starting with Fixed Broadband, 6% of revenues stood at EUR 19 million, an organic progression of 21% year-on-year. This reflects mostly the carryforward effect of the November 2021 wholesale agreements signed with Hispasat and the contribution of the multi-beam agreement signed last year on EUTELSAT 65 West A with several Mexican service providers. On a quarter-on-quarter basis, revenues were down by 16%, reflecting, in particular, a $2.5 million positive one-off booked in the fourth quarter of last year. Finally, mobility, 9% of revenues, saw revenues of EUR 26 million, up by 31% with a continued progress in Maritime driven by the agreement with Telenor in the Cruise segment as well as the contribution of EUTELSAT QUANTUM with 2 beams commercialized for incremental capacity in this vertical. Overall, the first quarter revenues are in line with our expectations, and we confirm our financial objectives. You will find a detailed press release and presentation on our Internet site on this Q1 figures. I am now handing over to Srikanth, who will share with you more financial data on OneWeb.

Okay. Thank you, Sandrine. Good morning. Hi, everyone. So shown on this chart are 4 key metrics for OneWeb that we would like to highlight today. The figures are in $1 million and represent management estimates for the period of 12 months ending 30th September '22. First, about the current order backlog. Neil spoke about the pipeline that the OneWeb team is currently pursuing across all continents. This pipeline currently stands at $2.7 billion. And as we prepared the charts, 22% had converted into confirmed orders at $600 million. But as, once again, repeating what Neil said, this picture is fast-changing. And since then, it's moved to nearly 25% nearing about $700 million of confirmed orders. This pipeline includes the contract with Eutelsat for $275 million. The other contracts account for $325 million. These are multiyear signed contracts in several geographies with an average maturity of 5 years. We are all quite encouraged by the deal momentum that we are seeing on the commercial pipeline. Second, OneWeb's top line counter started ticking in this 12-month period with an estimated $21 million revenue from our customers in North America. While the OneWeb service coverage is currently limited to 50 degrees north, there is good momentum in the last few months, and this will get reflected in the revenue guidance that you will see in the next chart. Revenues from geographies in the lower latitudes will follow the rocket launches and the Gen 1 system rollout. Third, the estimated EBITDA loss for the last 12 months ending September, again, is $198 million. This has to be seen in the context of revenue of $21 million and OpEx cost estimated at $219 million. OneWeb's stand-alone EBITDA is expected to break even in fiscal year '25. This will be driven by higher revenues and operating leverage arising out of the fixed nature of many lines in our cost structure. The fourth metric here is CapEx, and this is a significant one at this stage. Here, we reflect cash CapEx. Around $710 million was spent during the last 12 months. Cumulatively, since inception, cash CapEx on the Gen 1 system is around $4.5 billion to date. This represents 90% of the estimated full cost of $5 billion on Gen 1. The entire Gen 1 CapEx is fully funded by equity, including for the remaining $500 million to be spent in the next 12 months to complete the build-out. There is 0 financial debt in the company at this stage. Let me also point out that while I mentioned the total Gen 1 bill to be an estimated $5 billion, OneWeb shareholders have injected equity of just $2.7 billion. This reflect real CapEx savings of $2.3 billion, which have resulted in a cost advantage that is unique to OneWeb and a light balance sheet that is unmatched in the industry. Let me go on to the next chart to give you an overview of OneWeb's revenue forecast. On this chart, you can see on the left side, the revenue guidance for 2 years and some objectives for the years thereafter. This is for stand-alone OneWeb, and these are figures before the revenue synergies that Eva spoke about a little earlier. On the graph, you can see four data points. The revenue guidance for the Eutelsat accounting year ending June '23, is EUR 50 million, and this reflects the early momentum that I spoke about. For the second year, ending June '24, the guidance points to a three to fivefold increase to a range of EUR 150 million to EUR 250 million. The guidance for the third year ending June '25 reflects a doubling over fiscal '24 and growing significantly thereafter, as you can see on the chart. Add on to these projections, the revenue synergies factor. That sum will input into Eutelsat's overall combined EUR 2 billion objective for fiscal year '27 that you will hear from Eva in the next chart. Our objective for Gen 2 commercial launch being early 2028, the longer-term trajectory, will then take shape. On the right-hand side of this chart, we have outlined the key enablers that support this revenue guidance. Number one, the Gen 1 system, which now covers latitudes over 50 degrees north is expected to be globally available across all attitudes during fiscal '24, enabling revenue generation in all the geographies where there is demand. Number two, from a supply perspective, as we deploy the full system, the capacity in fiscal '23, which has started with just 130 gigs, will increase eightfold to 1.1 terabits per second in early 2024 -- calendar year 2024. Number three, our business model involves the participation of distribution partners. We have signed, at OneWeb, 44 distribution partnership agreements to date. And this number, again, is a fast-changing picture. This number keeps increasing, making it possible to service customers in all the key markets. Number four, mobility verticals, that is aero and maritime, they require ubiquitous coverage. The same applies to military use cases in the government segment. With global coverage, we will unlock opportunities in these verticals. As Massimiliano mentioned, more user terminals will get added to the product portfolio. Currently, we have two models on offer to our customers, and this will jump to more than 12 during fiscal year '24, significantly improving delivery capability at varying price points. And finally, I must emphasize once again how encouraged we are about the momentum in the commercial pipeline. The revenue ramp-up plans are backed by the strong pipeline -- multiyear pipeline of $2.7 billion that Neil spoke about, which, by the way, will fill up just 1/3 of OneWeb's network capacity. So there is significant headroom in terms of capacity and geography for more order conversion. So let me summarize what I've been speaking about. Our network build-out is fully equity financed. The OneWeb balance sheet is light and unmatched in the industry. There is 0 financial debt. There is growing customer demand and our supply capabilities are improving. Now partnership agreements are in place and improving and growing. This momentum is starting to reflect in our deal pipeline, as you have seen, into order conversion, which is a fast-changing picture and eventually into revenue execution. Thank you and back over to you, Eva.

Thank you, Srikanth. I think you've now seen a little bit about Eutelsat where we are, right, as we finish our Q1 in '23. You've seen the outlook for OneWeb stand-alone, and then there's a third and important element, which is all about the synergies. The synergies I talked about a little bit earlier are actually quite certain and quite robust and are split over three different categories. So revenue synergies around commercial acceleration of OneWeb leaning into the commercial network of Eutelsat. There are cost synergies, which are quite low in terms of implementation cost, because it's a lot about avoided cost over the next couple of years. And then finally, there are quite important CapEx synergies already from year 1 in terms of building the Gen 2 network together and start thinking GEO and LEO together. All of this adds up to $1.5 billion in NPV, a very important value driver. But importantly also is the low execution risk, the good balance about it and the fact that we already know OneWeb so well, we worked together as 2 companies given our investment 18 months ago, that we're ready to start rolling on these very fast. Let me dive into each of the 3 ones and start out with the commercial synergies. This one is not going to automatically close off the screen, guys. I'll keep on talking. Acceleration of the commercial ramp-up here is clearly that OneWeb will lean into the commercial network of Eutelsat will reduce the time to market in terms of being able to talk to so many customers at the same times, where we're already deep into some of these 6 different verticals you saw maybe 20 minutes ago. But we will also be able to bundle offers. That will take a little bit more time before we get to the full bundled terminal antenna, but we can already now commercially bundle. And then we can start testing and proof-of-concept-ing, actually, combined also in terms of product and delivery. And in 3 to 5 years, we will get to a single hybrid GEO/LEO terminal that can unlock also new user cases and potentially bring us into additional new verticals. That's when we get to what we would call a truly seamless customer experience. So you can see adding on to the commercial synergies over time. We expect this to ramp up to around [ $150 million ] in year 4 right now, but also continuing after that in addressing this truly unique seamless GEO/LEO offering. So those are the top line, the revenue synergies. Also importantly, the cost synergies, a bit more traditional in the way we look at it. But clearly, very strong technical, commercial and administrative organizations. We will fully integrate the 2 organizations in terms of the technical delivery. That's needed to actually think in GEO/LEO and the complementarity of the 2 networks from the start when we start designing the Gen 2, which is something we've started now, and will be probably finalized by the next summer, but also when we think about how we renew the GEO fleet in Eutelsat. Commercial, it's clear. A lot of sales forces in our connectivity unit, as you know, Eutelsat has just created a video and connectivity unit. And this is all about creating the connectivity unit, both around the connectivity sales in GEO and in LEO. And then finally, more traditional staff back office functions, IT, purchasing. It's clear that we will also have a totally different purchasing power, joining the 2 companies together. So we actually expect the cost synergy to ramp up over a 5-year period because of a lot of it being avoided cost, but that's why we believe that over a 5-year period, this will add up to around EUR 80 million in terms of cost synergies. The final one, CapEx synergies, which is actually going to kick in from year 1 and that's also a big element. And the time-sensitivity of this has to do with the start of the design of Gen 2. Massi told you a little bit that, that's actually going on now. You started seeing some of the requirements in Gen 2. And we are also, this spring -- around Christmas time, going to start having a real dialogue with multiple suppliers in the industry to be able to size up how the offer is going to be put together and who will be our suppliers for Gen 2. So rightsizing and thinking the GEO and LEO match into that is quite important as of now. Also longer term -- medium, longer term, also the rationalization of the GEO fleet. It's clear that Eutelsat stand-alone would rationalize the Video part of our GEO fleet that has little to do with this deal. But also when you think about the connectivity and need to launch satellites, adding capacity into the GEO space. We'll be able to stand on top of actually having a global LEO coverage for the areas that don't need massive amount of concentrated capacity. So that's the part in space, which is clearly a quite important part of our CapEx spend, but we actually also have a significant part on ground. So utilization of ground infrastructure, teleports, baseband, fiber purchasing will create a different purchasing power and a different network on ground. And also, over time, converge IT systems. We probably won't need both Oracle and SAP, sorry for one of them. But things like that will have to converge over time. But in total, we think that CapEx synergies would actually kick in quite significantly at the order of magnitude of EUR 80 million from year 1 and then, of course, improve with scale over time. So those were the three key elements, EUR 150 million in revenue synergies ramping up over 3 to 4 years. Secondly, cost synergies ramping up to EUR 80 million over 5 years. And then finally, CapEx synergies from year 1 of EUR 80 million. All of that adds up to the EUR 1.5 billion in total. So what will this give you when you have Eutelsat, which many of you have followed for years, OneWeb, which Srikanth just gave you a bit of detail on and then the synergies. This is a picture you will end up with. The combined picture is a company of double-digit growth, targeting to be around EUR 2 billion in '27, 5 years from now. Double-digit growth also over the medium to long term. '27, will have just started the Gen 2 commercialization, which means that over time, that will continue to be a very strong growth. We expect EBITDA to outgrow bottom line -- top line. We expect EBITDA to be growing faster than our top line in this period, targeting EUR 1.4 billion in '27. Growing after there also naturally as the Gen 2, network will start filling from '27 and on. So EBITDA, we expect to continue to outpace top line also after. CapEx, we expect it to be in the range, an average range of EUR 725 million to EUR 875 million over this period of '24 to '30, which includes the CapEx synergies. But we also expect some of it to be front-loaded given the investments needed in Gen 2. What we do believe in the longer term, which is quite important is that CapEx will come back down towards the end of this period and also into the years beyond, based on the fact that a Gen 2 will be regenerative. That means that you will be able to keep launching new satellites in there. You will not need a big bump on Gen 3, but you'll be able to do more maintenance CapEx on the Gen 2. And also, we expect a significant rationalizing of the GEO fleet, leading to a much lower CapEx needed for the geostationary. In terms of leverage, this will give us a peak leverage here at the next summer when we close the deal around 4, which is than Eutelsat has been traditionally. But we expect medium term to come back to a 3x leverage, which means that we'll suspend dividend for 3 years, 1 year more than this that we announced this summer, but we do expect to come back to a midterm leverage of 3 and also to be able to reinstate some kind of dividend policy after that. So this is going to happen how? What's the time line? Right now, we have just finalized most of our filings. So most of our filings are in. So the clock is starting to tick, which means there are probably 5 to 6 months to go, FCC probably being the longest one. We don't expect any big issues with it given the complementarity of the 2 companies, but that will probably bring us at least to the end of calendar Q1 '23, before we get most of those returns. So we expect by at least the end of H1 '23, we'd be able to finally approve this deal with all the regulatory approvals in. So it's a bit of a process ahead of us. The good thing is that we are already involved with OneWeb. We worked together as we are #2 shareholder in OneWeb. So a lot of these things have already started to happen. So just summing it up because I think it's important just to be clear on where we come from. Eutelsat needs to address the huge connectivity market, and we've started that with our telecom pivot strategy. However, when we look at a market which will grow double digits to $16 billion in 2030, 2/3 of that growth is going to come in non-GEO. And Eutelsat needs to address that market as well as we address it in the GEO. We need to address all of the $16 billion. And on web is just by far the best opportunity for Eutelsat to address that. It's 1 of only 2 constellations operating today with priority spectrum and filings, so everybody else will have lower priority to OneWeb. And we know them already. We know OneWeb. We've been there for the last 18 months. We know how the organization works. We've already started working together. And any alternative to get into the LEO space would be less attractive and less appealing to Eutelsat. It will be too long, too expensive and would be late. So OneWeb is by far the most attractive opportunity for us to address the entire connectivity market. And we'll be able to create a player with a truly unique position in the market, because we combine the best of both worlds. We'll be able to serve customers with both the advantages of geostationary in terms of large amounts of capacity at a cost-effective price, but also with all the things they want from LEO in terms of low latencies and ambiguous service, and customers want both. And I think the strongest proof is that we have yet to meet a customer who does not want to talk about this, who does not want both, who does not see the value of this. And I think that's a true strength of the uniqueness in the market. And we are the only player there. On top of that, we actually have $1.5 billion in value creation together, mostly in terms of robust avoided cost, but also in terms of CapEx avoidance, if you compare it to 2 companies stand-alone. We think that's a very strong value driver in this deal. So that gives you a different profile from what Eutelsat is today. I acknowledge that a lot of our shareholders have been used to a different financial policy out of Eutelsat. This will be different. This will be a company that grows double-digit addressing this connectivity market, growing at a fast pace. But also, with no dividend over the next 3-year period, but we'll be able to provide a very robust financial profile where the cash flows of our legacy business, finance the expansion into the connectivity market in a very robust way over the next couple of years. So with this, I hope we've shared our vision for how these two come together, where we are on it right now. what kind of time is it, but especially also why we believe it creates a lot of value for our shareholders.

With that, Neil, why don't you come up here? And I think we should open for questions. And for those of you who are in the room, it's the easy way, just raising your hand. We will probably also jump and just give the guys on the screen a chance or 2 in between. But let's start out with those of you who actually made the trip here. Should we start over there? You were fast. Can you maybe also say who you are, where you're from because I'm a little bit new to this, so.

I am Sami Kassab from BNP Paribas. And I have 3 questions, please.

Three? Okay.

To start with. The first one, you've painted a $16 billion market opportunity, of which almost half would go to LEO, $8 billion or so perhaps. And I'm struggling to reconcile the revenue guidance of $600 million that you've provided. It seems low compared to the market opportunity, compared to the fact that there are only 2 players out there and who knows whether there'll be many more. So can you elaborate a little bit on perhaps the market share you think you can get out of the $8 billion in terms of LEO or the $16 billion and whether -- hard to put into context the 2 numbers. The second question is on the EBITDA margins. You suggested that the new goal would have similar EBITDA margin to what Eutelsat currently has. And yet my understanding was that in the connectivity industry, the ground cost, in particular, like higher than in the Video side. So how could margins stay where they are today, Video declines and more expensive connectivity revenues grow? And lastly, we've seen the Intelsats, the SES, the ViaSats go down the vertical integration route and by distributors. Some of them we have signed -- some of them, OneWeb has signed deals with. So how do you think about vertical integration? And do you think that having a direct access with the service providers is something that you may consider going forward?

Yes. Maybe I start out and you supplement the estimated there.

Sure.

If I do the first, the $16 billion is in 2030. And yes, you are right. It's about a 50-50 split estimated there. However, there are multiple estimates, and I think we have it in back up on at this might actually be bigger. It's clear that what we guided, $600 million, which might seem conservative in terms of our expected market share, it's probably rare that you'll be after it if this comes out higher, I would think. But we definitely expect that as only 1 of 2 players, we'll have a significant market share of the deal capacity out there already. You want to give a word or 2 on…

Yes. I mean, I think that's -- just on Eva's point, I mean, what she's telegraphing is that we think that market penetration, and particularly from a warmer perspective, we think that market penetration is somewhat conservative. I think it equates, we think, somewhere around a 20% market penetration. So we think we can do better than that, but I think it makes sense to be cautious in this context.

And then the EBITDA margins, I think there's an element of the same. We expect once the Gen 2 network is fully up and running to have the same EBITDA margin. There's no reason not to see that. It is a scale game in a network. And as over this period, it will only be launching in '27, '28 and then it needs to be commercialized. But once the Gen 2 is commercialized, we expect EBITDA margins to come up and be the same. But that's over this period. There's no reason at all to think that we won't have a constellation margin at the same level as we have in Eutelsat combined today.

So I'm a little bit confused on the 20% market share penetration numbers you gave a minute ago. Do I have to understand that within the $2 billion forecast that you have for the new co, you have $1.6 billion for networks for the connectivity side in it? What's the 20% of the $8 billion then?

No. I suspect what you want to do is -- actually Jean-Hubert is actually here in the front row. If you want to get into the market analysis in detail, I suggest you talk with him after the event. He will take you through the numbers in exhaustive detail of how he arrived to that.

Very good. Then let's discuss the vertical integration then?

Briefly for the question, $7.5 billion for LEO is in fact the total market, including consumer, right? The B2B part of that is roughly $6 billion. We are talking, again, 2030. And so as Neil was suggesting, 2030, we have this conservative estimate implied in the guidance of 20%. We aim at more than that, clearly, rather 25% or more, but this is how you can reconcile the numbers. Happy to talk later.

Finally, on the vertical integration, yes, I think you're mentioning Eutelsat and SES. And we certainly also see players like Kuiper and Starlink, who are fully vertically integrated, right, all the way from launches and satellite manufacturing, all the way to actually supplying end customers. We have, as both companies chosen to work with the industry and standing on the back on investments that the entire industry is doing, whether it's in terminals or in satellites or launches, but also on the customer side, working with distributors, because we think that it's better go-to-market. They know the market already. And we not opted to integrate vertically and buying our customers. That also creates some conflicts when you start doing that. But we have seen, especially SES buying up in the military segment and others. And we would rather actually work with all distributors. And we are seeing that many of those distributors, even though they have been acquired by colleagues in the market, are still interested in talking to us because they want to provide the best capacity out there to their end customers. Jean-Hubert, anything?

Yes, I would just add, I would completely -- would you like some water, by the way?

Yes, please. Thank you.

I always, like, get these comments. I mean, I get asked this question all the time. And I think there are some specific instances where you have to buy distributor, which we did in the case of serving the U.S. DoD, because you have to have a clear organization to do that. So it's a specific requirement where you have to. But I think that the point about distributors, buying distributors, as Eva mentions, you do distort the market, certainly. And at the end of the day, you inherently limited customer choice at the end. And in my experience, limiting customer choice, in the long run, is probably not the best idea. So unless there's a very specific reason to do it, you got to think carefully about where you want to go down that path.

I think we had another one right in front of you, and then we'll go…

I wonder if you could give me the rough average cost of sending up a GEO satellite and a LEO satellite with the cost of the satellite, cost of the launch and cost of insurance. Second question is sort of linked to that. Do you -- in the past, GEO satellite companies have had CapEx holidays. Could there be 1 coming up for you? Or is a new the LEO investment going to absorb a lot of capital spending? And final question on Amazon. Like, I don't know how to pronounce this, Kuiper.

Kuiper.

Do you see that as a competitor? Or a client? Or something in the middle?

Yes. Okay. Those are big questions. Let me just start out with maybe the detail in how we break down the cost and CapEx on GEO and LEO satellites.

I can do the LEO bit, but…

You'll do the LEO.

Yes. I can take LEO.

But I think also, if you really want the details, I think Pascal and Massi are the right guys to find right after the presentation, and they'll be happy to tell you. A big GEO satellite as -- comes in, in a bit of different sizes as it reflect [ SATs ] that are more standard. And then there's all the way up to the KONNECT VHTS that we've just launched. Those are 3 digit million. coming from EUR 250 million all the way up to EUR 500 million in terms of everything included, this -- depending a bit on how big capacity and how many special missions they might carry. Pascal can give much more breakdown on how that launch is. Of course, an important part of this, building the satellite is an important one. But ground infrastructure is also an element, building out teleports to do that. So in order of magnitude, if you wanted, kind of 3 big satellites to cover the world, you might be looking at 3 times EUR 400 million to EUR 500 million to cover the world. LEO, just order of magnitude…

Yes. So I will give you broad-bush numbers because we're still in negotiations with some launch providers. So I don't want to get in too much detail here, but I can tell you the gentlemen in the front row there, I'm not going to ask him to comment on this. We have an extremely detailed knowledge of the market price for medium-sized launch rockets around the world, having been in negotiations during the course of this year or many of them. But in order of magnitude, I'm not going to give it to you on a per-satellite basis. I'll leave you to the last part of the math yourself. Generally speaking, we launch between 36 and 40 satellites each time we launch, an all-in cost, including rockets, satellite manufacturing and insurance is just slightly under $100 million.

Good. So CapEx holidays, it's great -- it's a great term, right? And I think what we're looking at here is that for at least the next couple of years here, we will need to launch the Gen 2. I don't think we'd consider that a CapEx holiday. I think is probably CapEx -intense work to get the Gen2 launch. But when you look at it slightly longer term and when you look post Gen 2, we expect Gen2 to be more of a maintenance and given that it lasts around 10 years, that will be at a much lower rhythm in terms of CapEx needed to maintain the Gen 2 and to renew it. And also on the GEO side, we'll be able to probably reduce, order magnitude, half the need in terms of CapEx on the geostationary. Not sure that qualifies entirely as holiday because that would mean absolutely no work, but maybe it's kind of more of a -- it's definitely much lower rhythm.

I forgot to give my name and place. It's Charles Elliot, Inflection Point Investments.

Delighted, Charles. The last one, Kuiper. I think, yes, we definitely expect to see them coming up. They have cleaned up a lot of launch capacity.

Yes. Yes. I think the answer to your question is yes. Actually, we expect them to be different parts of Amazon talked to us about -- seeking connectivity sites pertinent to the customer. And also, we expect to be a competitor. We don't really know candidly what their go-to-market model will be. And also at what point they will actually truly be in a market with an offering. Ironically, our factory in Florida is actually across the road from there. So we actually see what goes in and what comes out. And right now, there are a lot of stuff going in. But that's not to say that -- they clearly are committed to their endeavor. They brought -- on record, they brought a lot of the world's launch capacity, which also makes it harder for a fourth player to show up, because not much launch capacity left, which is why we took the step of strategically making sure we locked in our launch capacity for a Gen 2 now. We have options on it for 90% of that capacity now. But I expect them to be --increasingly, this industry is going to become more and more cooperative. As indeed, we are today with Starlink. They are both -- we're a customer of theirs in that -- that we've bought rockets from them. And also, we obviously have worked pretty hard on spectrum coordination. And I expect down the road, Amazon will also be -- there will be a mix of competition and a mix of -- they'll be a customer-expert.

We had 1 in the back and then we have 1 over here, oh and also there. Sorry, yes. There and then we have you. I forgot you, yes.

Ben Lyons, Credit Suisse. I had a few as well, sorry. So the first one, if I could go back to CapEx. So what gives you the confidence that the CapEx will drop half? And you think about data usage, it's growing at sort of 30%, 40% a year CAGR. Well you not just have to launch new satellites. And if there is a maintenance CapEx type scenario, why is that not happening with Gen 1? The next one would be just on the revenues. I believe when the first OneWeb investment was made, I think the guidance for revenues was $1 billion within 3 to 5 years. Why has that changed? Why is that now more than $600 million stand-alone -- and the last one, could we just get an update on the shareholder and that you've committed shareholders to the deal and their respective ownerships?

Okay. Let me take the first one and then you might comment on the revenues. But CapEx, yes, we do expect it to drop off. With the current estimates we have for how the market will develop, we expect it to drop off to be more of a maintenance CapEx where we will renew the satellites in Gen 2 over time, so on a rolling one. Gen 1 will be running -- will be replaced by '27, '28, where we'll have the Gen 2 up there. You want to say a few words on the previous revenue?

Yes. Sure. So first of all, the -- 2 comments on that. So look, we have some very demanding shareholders. We have pretty aggressive internal revenue targets. But I would say that as it's a matter of public record, we are later in deployment than we expected. We had expected to complete deployment by -- actually in July. However, we got involved in some geopolitical movements and had to essentially -- so we will resume launching in October and complete those launches essentially by the end of the end of spring. So we are somewhat behind schedule from what we initially anticipated.

And on shareholders, just to give you a quick overview. It's clear that we had both boards actually in strong support of this deal, which means that the shareholders will actually merge into shareholders of new Eutelsat, which means that the current shareholders of Eutelsat where Bpi is by far the largest, but also FSP is a large shareholder will also be shareholders in new Eutelsat. On top of that, we brought in a new shareholder with CMA CGM, which is a big French shipping logistics company, who's also very excited about this whole sector and what it can bring. From the OneWeb side, I think we are actually bringing a very strong set of shareholders with a lot of knowledge around the connectivity. First of all, Bharti Group, very strong telecom competence from a very global perspective, which will be, when we merge the 2, the largest shareholder in new Eutelsat. But also SoftBank, Hanwha and the U.K. government, which had helped reset OneWeb on its footing a couple of years ago, will be shareholders in the new entity.

Sorry, just a quick follow up. Can you [indiscernible]…

I think Bpi's between 23% and 24%, CMA CGM is around 7%, 8%, 6%, 7%, 7%, around there. FSP is still around 7%. That moves a little bit, but around there. I think we promised the -- because you were very fast, first, and then we'll come over here.

Great. Roshan Ranjit from Deutsche Bank. Just going back to the Gen 2 CapEx and the slide which you had about the savings between $1.5 billion and $1.8 billion. I think previous comments, Eva, I think you made that a LEO constellation from scratch would be around $5 billion to $6 billion. So should we be thinking that Gen 2 is around the $4 billion for the initial kind of investment? And secondly, around leverage. What, if anything, have you heard about your credit rating from the agencies if you are guiding to delevering over time? But I saw this morning, I think you've suspended a dividend for an additional year. Is that a kind of consideration in that? And lastly, just on the operational side, you talked about the -- like its high barriers to entry, but also, customers wanting to diversify their suppliers. How does that impact pricing? Because just looking at the read across from Video and your kind of legacy, I guess, business, we have seen that under pressure and eroded over time. So how do you give us comfort that pricing on the connectivity side will remain resilient?

Okay. Let me start with the first one, and then maybe, Sandrine, you talk a little bit about the credit ratings and the leverage. And then we'll come back on the execution side and pricing. But let me start out with the Gen 2 CapEx. That sounds, like, not totally wrong number you have in the top of mind, around the $4 billion in terms of what we're looking at for Gen 2. I think it's -- I'm not going to be 100% certain because we simply haven't done the full work on Gen 2, but that you see kind of envelope we're looking for, for Gen 2 constellation launch given the synergies we can see. Sandrine, on leverage and discussions with rating agencies.

So the rating agencies, as you know, we have 2 rating agencies on a solicited basis. The first one being Fitch, where we are BBB and S&P BBB minus as Eutelsat standalone. Both of them have issued a note after the announcement of the transaction with a credit watch pending the transaction to happen. There is still a lot of work to be done with the rating agencies. So we expect them to issue, in the next coming months, a more precise view on what they expect to be the rating at the closing of the transaction. But no specific precise discussion at this stage. It will happen in the next coming weeks and months.

I think what's important is for also rating agencies, they're doing this work in a market where there's very little comparison. There's no other player combining GEO and LEO with Starlink, and there's not necessarily a lot of public information on that. So I think as Sandrine is saying, there are some real work going on with the credit rating agencies, understanding this deal.

Yes. Part of the work being, as Eva just mentioned, to assess what is the business profile and other rating agency will look at the business profile of the combined entity.