Contested Space: The EU Seeks Autonomy While SES's China Ties Shake the United States

The dynamic and strategic satellite communications sector is being rocked by a $3.1 billion acquisition that's sending tremors through Washington. SES, the Luxembourg-based giant, is poised to acquire Intelsat, an American pioneer with a strong U.S. presence. The goal? To create a European space powerhouse, capable of competing with new players like Spacelink's Starlink and Amazon's Project Kuiper.However, this ambitious move is complicated by SES's close ties to Chinese entities that, according to the Pentagon, could be directly linked to the People's Liberation Army (PLA). This scenario raises deep concerns for U.S. national security, making approval of the agreement a geopolitical conundrum.

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The Companies Involved: SES and Intelsat

• SES (Société Européenne des Satellites): Founded in 1985 and headquartered in Luxembourg, SES is one of the world's leading satellite operators. It manages a vast fleet of satellites in geostationary orbit (GEO) and medium Earth orbit (MEO), including the O3b constellation. SES provides a comprehensive range of connectivity and video transmission services to clients worldwide, including telecommunications operators, internet service providers (ISPs), governments, institutions, and broadcasters. Its strength lies in its ability to offer high-speed, resilient connectivity solutions for terrestrial, maritime, aeronautical, and governmental applications.

• Intelsat: With a history dating back to the 1960s as an international consortium, Intelsat has long been a pioneer in providing global satellite communication services. Today, it's a private company based in the United States that manages one of the largest and most advanced fleets of geostationary satellites globally. Intelsat provides essential services for network connectivity, video transmission, and solutions for governments and businesses, often operating in critical contexts for the defense and national security of the United States and its allies. Its network is widely used to support military and governmental operations due to its reliability and global coverage.

The Operation: A European Giant in Space

Announced in April 2024 and expected to close in the second half of 2025, SES's acquisition of Intelsat would represent a paradigm shift in the sector. It would unite two of the world's largest satellite fleets, aiming to strengthen SES's position as a pan-European satellite operator. Luxembourg, which holds a stake in SES, views this move as solidifying its role in the space industry and enhancing Europe's capacity to provide global connectivity services. The European Union and the United Kingdom have already granted their unconditional approval, finding no competition concerns.

The Chinese Knot: Partnerships and National Security Concerns

The real obstacle, however, isn't competition, but national security. U.S. authorities – including the Federal Communications Commission (FCC) and the Department of Justice (DOJ), supported by intelligence and defense agencies – are scrutinizing the deal with extreme caution. The sticking point is SES's alleged partnerships with Chinese entities that Washington considers linked to Beijing's military-industrial complex.

The concern is palpable. Just days after the Intelsat acquisition announcement, SES publicized a strategic partnership called "Open Orbits" with AeroSat Link. This Chinese company is a subsidiary of China Satcom, which in turn is part of the state-owned Chinese conglomerate China Aerospace Science and Technology Corporation (CASC), known for its deep ties to the People's Liberation Army (PLA). China Satcom is directly connected to the CCP's military apparatus, operating as a subsidiary of the state-owned China Aerospace Science and Technology Corporation (CASC). Furthermore, in 2020, then-President Trump placed China Satcom on his list of Chinese military-industrial complex companies, identifying them as a security threat and prohibiting Americans from owning or investing in their shares.

According to SES, the "Open Orbits" partnership aims to support "an open architecture network where traffic can be intelligently routed from one interoperable Ka-band network to another." Ka-band is a crucial frequency for high-speed satellite communications, used not only by SES and Intelsat but also by key players like Elon Musk's Starlink.

The statement by China Satcom Vice President Yufei Shen, included in an SES press release, further raised red flags in Washington: "China Satcom is extremely pleased to partner with SES to help us achieve a whole new level of in-flight connectivity by leveraging our Ka-band network." This statement clearly implies that data, including potentially sensitive data from American users or government and military services, could pass through Chinese-controlled satellites.

A broader picture of European-Chinese concerns.

It's not just SES that's causing concern. According to some sources, the Parisian company Eutelsat has also joined China's "One Belt, One Road" international commercial infrastructure program, also known as the Belt and Road Initiative. In January 2018, Eutelsat entered into a "cooperation agreement" with China Unicom to use its Eutelsat-172b satellite for in-flight connectivity and to collaboratively study satellite communication services. Subsequently, UnicomAirNet, a subsidiary of China Unicom, entered into a multi-year agreement with Eutelsat Asia to lease the remaining capacity of the Eutelsat 172B satellite for IFC (In-Flight Connectivity) services. This highlights a broader trend of European satellite operators forging ties with Chinese entities, fueling nervousness among U.S. lawmakers who fear increasing reliance on Beijing's infrastructure.

Implications for the United States: National Security First

U.S. concerns are based on several pillars:

1. Access to Sensitive Data: The risk that data transmitted through the combined network (which would include Intelsat infrastructure also used by the U.S. government and military) could be intercepted or compromised by Chinese entities.

2. Vulnerability of Critical Infrastructure: The possibility that network interconnectivity could create points of vulnerability for espionage or, in worse-case scenarios, for the disabling of critical communications in a conflict.

3. Technology Transfer: The collaboration could inadvertently facilitate the transfer of advanced technological know-how that could be used to strengthen China's space and military capabilities.

These ties with China raise serious questions about the sensitive work SES performs for the U.S. government, including its Secured Integrated Multi-Orbit Network (SMTN), a platform designed to integrate commercial and military networks. The potential intermingling of Western satellite infrastructure with that linked to the Chinese military-industrial complex, through a key operator like SES, is a red flag for U.S. security. The Pentagon maintains a list of Chinese companies considered linked to the military-industrial complex, and each new partnership with one of these entities is viewed with increasing alarm. The history of U.S. concerns regarding satellite technology transfer to China dates back decades, with congressional investigations highlighting the risks. Even as the context has evolved, vigilance remains paramount.

SES's Complex Geopolitical Play: Between East and West

SES's position in the geopolitical landscape is further complicated by its dual strategy. While forging partnerships in the East, it's also a key player in Western defense and security strategies. SES, which operates a multi-orbit fleet of around 70 satellites, has contracts with NATO and the Pentagon for secure satellite communications for governmental and military purposes.

Parallel to its Chinese ties, SES is in talks with the European Union and other governments to integrate services provided by Elon Musk's Starlink. This initiative arises in a context of heightened tension, particularly regarding the war in Ukraine. In March, the EU contacted satellite operators like SES and Eutelsat to explore how they could contribute if Washington were to cut Kyiv's access to Starlink.

Adel Al-Saleh, SES CEO, told Reuters that these discussions have evolved from simple inquiries to more strategic medium- and long-term considerations. He emphasized European governments' increasing commitment to boosting defense spending. "There are alternatives, not to completely replace Starlink, which is not possible, but to enhance and complement Starlink," Al-Saleh said in an interview. This scenario highlights Europe's need to develop national and resilient options for its space communications, while SES navigates between Western security requirements and commercial opportunities offered by the East.

The Regulatory Path and the Future

The acquisition of Intelsat is now under the scrutiny of the FCC and the DOJ. The FCC will need to determine if the deal is "in the public interest," a criterion that broadly includes national security considerations. The DOJ, often in coordination with the Committee on Foreign Investment in the United States (CFIUS), will assess the antitrust and security implications of the transaction.

The outcome of this review is uncertain. It could lead to significant delays in approval or the imposition of stringent conditions on SES. Such conditions might include the divestment of certain assets, strict segregation of specific data flows, or a requirement for guarantees that Intelsat's infrastructure will not be used for purposes deemed adverse to U.S. interests.

Conclusions

SES's acquisition of Intelsat is more than just a commercial transaction in the satellite sector. It's a microcosm of global geopolitical tensions, where technology, connectivity, and national security intertwine in a complex knot. While Europe pushes for a space giant capable of competing, Washington assesses the risks arising from partnerships that could, even indirectly, bolster the capabilities of a strategic adversary. The fate of this acquisition will not only influence the future of satellite communications but could also set an important precedent for managing transnational partnerships in an era of intensifying competition among major powers.