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back to article Galileo PFI delayed by revenue fears

Galileo, the planned European rival to America's Global Positioning System (GPS), is in trouble. Much of the ambitious project's construction is supposed to be privately funded, and plans call for a united pan-European company to oversee the set-up and running of the Galileo network. But the various private companies involved …

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  1. SImon Hobson Bronze badge

    Oh gosh, what a non-surprise !

    I recall when Galileo was first talked about, I (and many of my friends) simply couldn't see where the business case was.

    I can see the 'national security' angle but have to wonder if we can really see the day when Europe falls out with the US to the extent that the US will turn off GPS. I can see certain specific markets where the higher accuracy and accountability would be a benefit. But for the general market I REALLY cannot see a business case.

    The US GPS system is well established, receiver designs are mature making them reliable and cheap, a whole variety of equipment is available for just about any conceivable requirement.

    To support Galileo will mean new receiver designs (cost), new hardware (cost), additional products to stock, distribute, and market (cost), and just for good measure I understand there is intended to be a licence fee payable for every unit (cost). So for the majority of potential customers they will have a choice of an established and cheap unit for GPS, or a new (risk of more bugs), more expensive unit that does essentially the same thing.

    In short, there is no mass market for Galileo unless it is made free to use and free to make/sell receivers for it. As the article points out, if your price point is free, then where is the profit ? No profit potential means that no-one in their right mind will invest for simple business reasons.

    Also as the article points out, there may be politically imposed markets IF certain users are forced to use the system. As a private pilot I can tell you that we have been watching with 'interest' to see if our aviation authorities try and stuff us with yet another round of pointless and very expensive equipment upgrades by mandating use of Galileo for aviation use. GPS has proved accurate and reliable for instrument approaches in the US where they have had such procedures for a few years - our CAA has only recently caved in and done trials to see if they'd work here (results not out yet).

    If the various governments want this for strategic or security reasons then quite simply they are going to have to pay for it, otherwise there is no business case and it just isn't going to happen !

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  2. amanfromMars

    One's a monopoly, two's company.........?

    "The London Financial Times today quoted an unnamed corporate exec as saying "Why sell Pepsi when you can get Coke for free?" ......

    Yes, how very prescient. And once addicted to one dealer then they are in a position to do whatever they will with the product.

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  3. Paul Crawford Silver badge

    Just as expected

    As already stated, this is really no surprise at all. I also noted at the time Galileo was announced that there was very little commercial case for such a system but still the EU went ahead with the public delusion that this would be mostly a commercially funded project, etc.

    Rubbish, as already pointed out GPS is virtually free and in most case good enough. Unless they do some stupid arm-twisting to mandate this (which is well within the capabilities of the EU) it will go nowhere.

    That is not to say I am against Galileo, I think it is valuable to have an alternative to the US for the future and it is of course very beneficial to the EU's industry

    But why oh why can't the politicians behind this just be honest and say "We want it for strategic reasons and are willing to pay for that", is that too much to ask? Yes, probably...

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