EU Renders Non-Decision on Galileo Bids
The European body tasked with selecting a consortium to run the Galileo satellite navigation project announced March 1 that it was unable to select a winning bidder to build its EUR 3.2B ($4.2B) Galileo satellite navigation system. It asked the Eurely and iNavSat consortia to resubmit bids for a final selection within three months. The GJU office in charge of the project noted that the two received bids were very close technically, and stated their belief that that extending the negotiations will lead to further improvements in offers. At the same time, private investors in the project are concerned that commercial considerations are taking a back seat to politics. The bidding consortia themselves expressed dismay, with one source noting that it could lead to cost increases and a delay in service provision.
The EU is hoping Galileo will provide an alternative to the Pentagon-controlled Global Positioning System (GPS), and also tap a growing worldwide demand for satellite communications that may be worth as much as EUR 300B by 2020. The EU also continues to recruit other countries to join the list of Galileo partners, as China’s recent EUR 200M commitment demonstrates. While Galileo is a commercial venture, and two-thirds of its cost is expected to be covered by private financing, some countries are concerned that partners like China intend to use the system for military purposes as well. Financial Times: EU puts off decision on bids for Galileo project