IRIS² Lifts Off as European Commission and SpaceRISE Sign Contract in Brussels
SpaceRISE, the consortium comprising Eutelsat, Hispasat and SES, has signed the agreement with the European Commission (EC) and the European Space Agency (ESA) that will see the consortium design, deliver and operate the Infrastructure for Resilience, Interconnectivity and Security by Satellite (IRIS²) for a period of 12 years. The contract was signed today in a ceremony at the European Commission headquarters in Brussels.
With the network of 290 new Low Earth Orbit and Medium Earth Orbit satellites expected to provide services by the beginning of 2030, the IRIS² constellation of satellites for a resilient, interconnected and secure Europe is an EU flagship initiative. IRIS² will be the preferred and trusted network for Europe in delivering secure and reliable high-performance communication solutions to the EU and its Member States as well as high-speed broadband connectivity for European citizens, governmental authorities and businesses, playing a transformative role in reinforcing Europe’s digital sovereignty, and low-latency connectivity.
Under the agreement with SpaceRISE, the project will be backed by €6.5 billion of public funds representing nearly 60% of the total project costs – comprising funding from the European Commission, EU Member States, the European Space Agency and private financing from the consortium members. The SpaceRISE consortium will lead the wider European space industry to accelerate innovation throughout the supply chain, enhancing Europe's leadership and competitiveness in the space sector.
Additionally, the Public-private Partnership (PPP) model in the form of Concession will unite public and commercial interests in an unprecedented way, paving the way for continuous implementation of innovative solutions and platforms for the future.
Andrius Kubilius, Commissioner for Defence and Space said: “Today we are not just launching a satellite project. We are launching a vision - a vision of a stronger, more connected, and more resilient Europe. IRIS² demonstrates the Union’s resolve and commitment to strengthening Europe’s space global posture both in terms of security and competitiveness to the benefit of our governments, businesses and citizens.”
“In an increasingly complex geopolitical world, ensuring resilient, secure and fast governmental communications is essential. ESA will play a crucial role in the technical implementation of the IRIS2 programme. ESA’s excellence will foster innovation in the European space industry, boost European competitiveness, create high-skill jobs and attract talents to Europe. The Commission’s trust in ESA to oversee the development of the constellation and its ground infrastructure speaks volumes of ESA’s successful track record in the delivery of European flagship programmes. ESA is ready to deliver again, for Europe and its citizens,” said Josef Aschbacher, ESA’s Director General.
Adel Al-Saleh, Chief Executive Officer of SES, said, “We are honoured to lead the SpaceRISE consortium to work with the European Commission and the European Space Agency on the IRIS² project. IRIS² is integral to Europe's space strategy and is already fostering enhanced collaboration and innovation between the industry and public sectors. By strategically coming together, we will be able to ensure architecture resiliency and security from Day 1 of the system launch. With EC as an anchor customer of the constellation, our investment into IRIS² will see us augment our MEO capabilities while executing our required rate of return, maintaining investment grade balance sheet metrics, and returning cash to our shareholders.”
Eva Berneke, Chief Executive Officer of Eutelsat commented, “IRIS² programme is a landmark initiative that embodies Europe’s commitment to digital sovereignty, resilience, and strategic autonomy. At Eutelsat, we are uniquely positioned to bring unparalleled expertise to this mission, leveraging our pioneering capabilities, including our cutting-edge LEO constellation. By combining this advanced infrastructure with the collective strengths of the SpaceRISE consortium, we will deliver a transformative communications backbone that addresses Europe’s most critical connectivity needs of our governments, reinforces its leadership in space innovation, and bridges the digital divide for millions of citizens and businesses across the continent. This project is a testament to Eutelsat’s vision of driving secure and sustainable connectivity for a resilient Europe.”
Miguel Ángel Panduro, Chief Executive Officer of Hispasat added, “The signing of IRIS2 is a historical milestone for European space. Hispasat was born out of public-private collaboration to provide government and commercial communications in geographical areas of interest to our country. We are therefore convinced that, through SpaceRISE, we will not only guarantee the secure communications of the Member States, but also contribute to generating a more innovative and competitive ecosystem at a time of special relevance for the European space industry.”
Consortium Members’ Roles
Eutelsat
Eutelsat will act as Consortium System Development Prime, the technical authority within the consortium. In this role it will leverage its unique LEO expertise and make available its priority spectrum rights in the Ku band to lead on the design of the LEO segment of the constellation, as well as co-leading on the conception of the common elements. Eutelsat will benefit, along with the other SpaceRISE members, from the scale advantages of shared fixed costs and R&D investments in the development of new technologies, while revenues from the EU will flow in during the build phase covering the up-front operating costs of the concessionaire. Finally, it will benefit, alongside its SpaceRISE partners, from commitments from the Commission and Member States for IRIS2 capacity to the tune of several hundred million Euros.
Eutelsat’s involvement in IRIS2 represents a key step in the company’s strategy to develop and expand its low Earth orbit capacities, and the extension of its existing OneWeb constellation will be technologically compatible with the future IRIS2 assets. Once operational the IRIS² constellation will offer compelling complementarity with Eutelsat’s existing LEO business, notably giving Eutelsat access to additional sellable LEO capacity secured by its investment of at least 1.5 Tbps out of a total of 2 Tbps of LEO capacity, at an attractive cost per Gbps, as well as to KaMil capacity not consumed by EU sovereign needs. Eutelsat will also be able to complete IRIS2 with further satellites to scale up capacity and carry additional payloads based on demand.
The project is fully consistent with Eutelsat’s financial framework and compatible with its required returns on investment. Eutelsat’s financial commitment is clearly capped, while the agreement signed today comprises protections to support the economics of the project including notably strict milestones providing for exit possibilities and compensation for consortium members in the event of missed of delayed targets compromising anticipated returns. Over the period of the concession, Eutelsat expects to generate revenues of at least 6.5 billion euros, derived from anchor EU customers as well as the global distribution of its LEO capacities to commercial customers.
SES
SES’s contribution to IRIS2 will be to develop, procure, and operate 18 new MEO satellites providing 100% pole-to-pole coverage with carrier-grade connectivity solutions. SES will have rights to commercialise the MEO capacity and part of the LEO capacity of the IRIS2 system. The compelling combination of high throughput data rates, low latency, service flexibility, and managed solutions will cater to EU’s sophisticated requirements, as well as allied nations and SES’s customers around the world.
With deployment of SES’s O3b mPOWER completed in 2027 and subsequent commercial ramp up, the delivery of IRIS2 is well timed to provide next-generation MEO capabilities to serve expanding customer demand for SES’s high performance connectivity solutions, underpinning profitable growth into the next decade. The IRIS2 satellites will form the foundation for SES's next-generation MEO capabilities.
The Internal Rate Return (IRR) of the contract is expected to exceed 10% and is underpinned by a strong commercial value proposition and built-in protection mechanisms. The MEO offering, complemented by access to LEO capacity, will serve a range of government and commercial requirements including fixed government connectivity; intelligence, surveillance, and reconnaissance; navy and air force needs; mobile backhaul and trunking; enterprise and cloud applications; global inflight connectivity; and connecting cruise ships around the world.
Participation in IRIS2 is fully consistent with the principles of SES’s financial policy. SES maintains its prior expectation to have an Adjusted Net Debt to Adjusted EBITDA ratio of below 3 times within 12-18 months after closing the Intelsat acquisition, which is on track to complete during H2 2025. SES’s commitment to a stable to progressive dividend is also reaffirmed with an annual base dividend of at least €0.50 per A-share. SES intends to increase the annual dividend as soon as the Adjusted Net Debt to Adjusted EBITDA ratio is reduced to below 3 times which is expected by 2027 as noted above.
The IRIS2 contract will be incremental to SES’s current investment outlook (average of around €350 million per year on a standalone basis and €600-650 million per year pro forma for the Intelsat acquisition over 2025-2030), revenue, and profit plans. The capital expenditure (CapEx) for IRIS2 of up to €1.8 billion will start ramping from 2027 and have an average annual spend of around €400 million over 2027-2030.
Hispasat
Hispasat is responsible for the design, deliver and operation of the IRIS² ground segment, including all the facilities necessary for the management and operation of the different orbital layers of the constellation, as well as the interconnection with terrestrial networks. The ground segment will have different locations (control centres, service stations, telecontrol and telemetry), guaranteeing the strict security and resilience requirements inherent to such a governmental communications system.
Within the consortium, Hispasat assumes the role of responsible for the operation and provision of services to the Member States, which will include the identification of the catalogue of services, the design of the concept of operations, the procedures for its implementation and the service provision schemes to be developed.
In addition, the company will lead the very low orbital layer (Low LEO) of the constellation, designed to operate below 750 km altitude. It will embark on innovative missions, interconnected with the rest of the constellation, which will contribute to boosting the ecosystem of European start-ups and SMEs and to developing the most cutting-edge solutions in space.
The investment of Hispasat in IRIS² could amount to up to 600 million euros, subject to the final design of the constellation and the verification of different parameters to be confirmed at the preliminary design milestone of the project. This investment gives the company access to non-geostationary orbit capabilities in regions of high strategic interest and business relevance. The aim is to complement the portfolio of products with which the Hispasat Group presents itself to the market today, expanding its geographical areas and business verticals. Part of this investment is linked to access to capacities in military bands that remain surplus or to the incorporation of payloads of interest that must be analysed and evaluated during the first year of the contract.
This commitment to multiorbital solutions responds to the strategy defined by the company in its Strategic Plan and meets the financial principles required by its shareholders. From 2025, Hispasat expects to generate revenues and EBITDA linked to the work related to the design and acquisition phases of the system.