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YEES Members communication relative to the last consortium announcement, in the frame of the IRIS² Secure connectivity programme

05/05/2023.

Following the announcement of the operators’ and satellite manufacturers’ consortium partaking the tendering process of the IRIS² Secure connectivity programme, YEESS Members would like to state some facts and opinions, as well as reassert their willingness to build with all other stakeholders a successful new space flagship programme for the European Union.

Competitiveness of the offer

YEESS Members acknowledge that there is only one consortium that has applied to the eligibility process and hence, the only one that will be in the position of submitting an offer.

We understand that, given the size of the contract and the additional private investment required on top of the public one requested by the Commission, it was difficult to build a viable offer without joining forces at best.

However, we see it as a potential threat to the sound deployment of the programme and it raises some concerns on the competitiveness of the final offer, as well as on the level playing field of the negotiations – both with the Commission and subcontractors outside the core team.

Introduction of new SMEs and start-ups in the consortium

None of the emergent actors has been involved in this core team, despite the European Commission clearly highlighting the importance of the involvement of new players during earlier discussions, and the objectives set in the dedicated Regulation.

Though it means that none has been deemed sufficiently strong to side by incumbent players for 70% of the programme, it also means that only the 30% of the offer submitted by the consortium will be found outside this core team, and hence leaves very small space to involve new players – when you have.

We want to highlight, for example, the fact that no partners from the access to space industry have been involved in the consortium, which could, in the end, heavily bias the 30% of the programme really available to involve new start-ups and SMEs in the competitive tendering.

We do hope that in its evaluation, the Commission will be vigilant to the percentage of SMEs and start-ups partaking and will set clear requirements in the next phase that incentivize the consortium to integrate also newcomers and small subcontractors.

Innovation introduced in the IRIS² programme

We understand that the budget dedicated to R&D could require a percentage of SMEs and start-ups involvement. We do want to seize such an opportunity to prove to the Institutions and incumbent industrial players, how much the “core team” could benefit from innovation coming from the small and new actors – also building the future of the space industry.

We also acknowledge the choice made by the Commission, opting for an R&D subsidy tool to fuel innovation for the IRIS² Secure connectivity programme. We would like to recall how much contracts help start-ups to really leverage public money (for 1€ of public contract, up to 10€ are to be raised from private Venture capital). R&D is key to develop future critical technologies but do not ensure every time that we prepare for new emerging markets and services with the best solutions, and that we are able to quickly adapt to changes. On this last point, start-ups are critical tools to keep up with these changes, thanks to the private funds raised pacing up their momentum - and even better with an institutional anchor customer involved.

We understand that the innovation layer of the IRIS² programme is aimed at integrating by 2027 new services which is a perspective we warmly welcome. This tool to prepare the integration of new services (in anticipation of the new markets and services to be here by 2027-2034), is unfortunately very limited in comparison, with only tens of million euros available by 2027, on the multi-billions program. We are all aware that the services and markets envisioned by the Commission for 2027 are to be reconsidered along the development of the programme, and even more considering the 2034 timeframe. We encourage the Commission and the Member States to provide with tools to ensure a robust technical layer for key technologies with stable uses, and without neglecting the possibility to adjust with other layers of innovation – as for instance the Space Development Agency does in the United States.

Conclusion

If YEESS Members will remain vigilant on the effective share of the competition dedicated to introducing new SMEs and start-ups in the third space flagship programme of the European Commission, they are willing to offer their state of the art innovation and excellency to build a successful IRIS² programme, to the benefit of EU citizens.

YEESS Member