Eutelsat shares jump as Ukraine flags curbs on Starlink military-grade service

Shares in European satellite operator Eutelsat rose sharply on Wednesday after Ukraine said SpaceX's Starlink had introduced restrictions on its military-grade service, ‌fuelling investor bets that European providers could benefit from growing strains between Washington and Kyiv. Eutelsat, which is seen as Europe's best shot at taking on Starlink, gained 13.1% by 1136 GMT, while Luxembourg-based rival SES, ‌which also provides satellite connectivity services, rose 3.9%.

Analysts said the move reflected investor expectations that European governments ‌and customers could seek alternatives to US-owned space assets if access to American services becomes less certain. "I think this is related to the US administration's favourable Russia/unfavourable Ukraine stance that has developed in recent days, meaning no or limited access ⁠to US-owned satellite ​services and intelligence sharing, ⁠putting European providers back in the spotlight as potential alternatives," Bernstein analyst Aleksander Peterc said.

Eutelsat is currently the only other ⁠company in the world besides SpaceX that provides space-based internet services through its OneWeb network of satellites in low ​Earth orbit. But Starlink, which targets consumers directly, has around 10,000 satellites in orbit compared with ⁠Eutelsat's more than 600. Investors appear to be betting that geopolitical tensions could drive demand towards European satellite operators. Experts caution, ⁠however, ​that existing Starlink users cannot simply migrate to OneWeb and that any transition would require the deployment of new terminals and supporting infrastructure.

"OneWeb may provide useful complementary capacity, but considering it as ⁠a straightforward substitute overlooks significant operational and infrastructure constraints," independent satellite consultant Christian Freiherr von der Ropp said. Replacing ⁠Starlink or Starshield would ⁠require the deployment of large numbers of new user terminals, he said, while adding OneWeb's smaller constellation and different network architecture could limit its usefulness in ‌some military applications.