TheChek News Flow

European telecoms groups join forces to challenge Elon Musk’s Starlink

Deutsche Telekom, Orange, Telefónica and Vodafone to explore joint bid for spectrum to provide mobile satellite coverage

Four of Europe’s largest telecoms groups are exploring launching their own satellite mobile services to challenge the dominance of Elon Musk’s Starlink, in a move that could further inflame transatlantic tensions over the communications technology.

Deutsche Telekom, Orange, Telefónica and Vodafone said on Monday that they had signed a letter of intent to explore a potential joint bid for radio wave spectrum that would enable them to provide “direct-to-device” satellite mobile services in Europe.

The move comes amid an intensifying geopolitical dispute over satellite telecommunications services.

In May, the European Commission proposed reserving the part of its spectrum band that allows smartphones to connect directly to satellites for European players. The so-called 2 GHz frequency band is currently used by two American companies, Viasat and EchoStar, whose licences expire next year.

The proposal has become a transatlantic tension point. Last week, the US ambassador to the EU told the FT that European companies would face “devastating” retaliation if the bloc did not change its proposal, which would be prejudicial against US companies such as Starlink.

The Commission’s plans have been fiercely criticised by SpaceX, which operates the Starlink platform. The tech giant warned the move risked poorer connectivity in Ukraine where Starlink has been critical to civilian and military communications since Russia’s full-scale invasion. 

Starlink has been at the centre of controversy this month after its services were disrupted in Ukraine amid tensions between US President Donald Trump and his counterpart in Ukraine, Volodymyr Zelenskyy.

The European companies’ joint satellite initiative has been privately applauded by the bloc’s officials, according to several people involved in the discussions. The EU is pushing to reduce Europe’s heavy reliance on core digital infrastructure provided by suppliers outside the bloc.

The initiative would mean the companies establishing the necessary ground infrastructure, or base stations, needed for satellite connectivity. 

However, instead of developing their own satellite constellation, they would partner with an existing provider, which is yet to be selected.

This could pose challenges for the proposal, with most satellite constellations being operated by US or Chinese companies. French satellite operator Eutelsat has developed a large-scale constellation but the company is far behind Starlink, which has more than 11,000 satellites in orbit.

Goldman Sachs analyst Andrew Lee said the move was a “reassuring reminder to investors that European operators see satellite as a companion technology to their domestic networks and that European authorities wish to carve out satellite-ready spectrum for European players”.

Private equity group disputes it gave false or misleading information to Brussels as it sought clearance for FiberCop deal

KKR gave false or misleading information to EU regulators during its €22bn acquisition of Telecom Italia’s fixed-line network in 2024, according to initial findings released by Brussels on Monday.

The US private equity group is being investigated by the European Commission after telecoms operators complained that prices to access the network had been increased since the deal despite assurances given by KKR when it was seeking regulatory clearance for the transaction.

“KKR appears to have provided incorrect or misleading information about whether it would keep its existing long-term access agreements under the same terms unless mutually agreed otherwise with the third-party operators,” the EU’s competition chief Teresa Ribera said as the Commission released its preliminary findings.

Brussels approved the deal — which envisaged the carving out of the fixed-line network from telecommunications operator Telecom Italia — in 2024 after receiving assurances from KKR that the deal would not worsen wholesale access for rival operators. It opened a fresh investigation last year after complaints by some of those operators.

On Monday, the Commission said it “takes the preliminary view that KKR, at least negligently, submitted incorrect and/or misleading information” about the agreements governing access to the network, including that their existing terms would continue to apply and could not be unilaterally changed.

The Commission said that this information, provided by KKR in response to requests by Brussels, had been “key” in its assessment of the transaction.

KKR said it “strongly disagrees with the European Commission’s preliminary assessment” that it plans to “vigorously challenge”.

“We stand by the accuracy of the information provided during the Commission’s 2024 review,” it added.

Since KKR took control of the FiberCop fixed-line network, relations between the network operator and its largest customers, including Telecom Italia, Fastweb, Vodafone, Iliad and Wind Tre, have become increasingly strained over wholesale access prices and service quality.

Telecom Italia, which now pays to use the network it once owned, also unsuccessfully challenged the increases in court.

FiberCop fiercely rejected claims its service quality had deteriorated, saying that performance was “broadly in line with, and in some cases better than, pre-separation levels”.

It also defended its wholesale pricing framework, arguing its tariffs were subject to regulatory oversight and that it was working with Italy’s telecoms regulator to establish a new pricing structure.

The disputes have added to KKR’s difficulties in turning FiberCop into a profitable standalone business, as it grapples with declining connections, heavy debt and pressure from Rome to combine its infrastructure with state-controlled rival Open Fiber.

There is no legal deadline for the Commission to end its investigation and KKR will now have time to respond to the preliminary findings.

Paul-Emmanuel Reiffers has raised his stake to 86 percent in the creative consulting group, with plans to double sales within five years.

PARIS — Paul-Emmanuel Reiffers, founder and chief executive officer of French creative consulting group Mazarine, has increased his stake in the company to 86 percent, bringing to a close a 15-year period of private equity backing as he looks to accelerate international expansion.

The transaction, completed in September, marks the successful exit of LBO France, Mirabaud and FG Bros, which supported Reiffers in regaining a majority stake of 54 percent in 2022.

Jacques Veyrat has joined as a minority investor through his Impala holding company, with a 9 percent stake, while the group’s managing directors collectively hold 5 percent.

Financial terms were not disclosed. Mazarine’s current annual revenue is around 300 million euros, company representatives said.

The group operates across luxury communications, creative services, events, media and art, and cultural production with around 500 employees worldwide.

Reiffers said the decision to consolidate ownership was driven by his desire to retain greater control over strategic decisions and invest with a longer-term horizon.

“I’m not working to sell the company. I don’t want to have a financial company. I want to have a creative company, and I want to build a really beautiful brand,” said Reiffers. “I want to build the company for the next 30 years and more, because my sons are now working with me.”

Reiffers’ sons, Boniface and Stanislas, have joined the business in Paris and New York, respectively.

Reiffers has set an ambitious growth target for Mazarine, aiming to double revenue within the next five years while expanding its international footprint. Around 75 percent of the group’s business currently comes from France, he said, with the remainder generated across markets including the U.S., China and the Middle East.

The U.S. is a major focus going forward. Mazarine’s U.S. revenue has tripled over the past three years to around $70 million, Reiffers said. The group works with luxury houses there such as Tiffany & Co., as well as U.S. brands beyond traditional luxury including Nike and Apple.

“When you arrive in the U.S. as a brand from France, you have the savoir faire français of creative production, and they appreciate that a lot,” he said. “The market is really big and really dynamic, and we have huge potential in U.S.”

Mazarine is also looking to expand in Italy, where it already works with brands including Gucci and Loro Piana. The group plans to open an office in Milan in 2027, building on its existing office in Venice, where it produces art and cultural projects, including work connected to the Venice Biennale.

In China, Reiffers sees the potential for expansion despite the difficult market environment and is eyeing an acquisition there as a possible route to growth.

The group’s plans for the Middle East have been affected by the regional conflict, which has put some expansion activity in the region on hold.

Reiffers sees the current luxury slowdown as an opportunity for companies to rethink their strategies, diversify and invest in talent. After several years of strong industry growth, he described the current period as a pause rather than a structural downturn, pointing to geopolitical uncertainty weighing on the market, as well as changes in creative leadership at major fashion houses needing time to gel.

“For my company, the crisis is an opportunity to diversify,” he said.

That diversification has so far included expanding into art and exhibition production through Arter, which Mazarine acquired two years ago, and working with clients outside the traditional luxury sector. In June, Mazarine acquired London-based luxury lifestyle public relations firm Bacchus, to boost its access to ultra-high-net-worth individuals for future projects and events.

Reiffers said the group has a strong pipeline of business over the next two years.

Luxury brands are increasingly interested in producing heritage exhibits that can be reproduced in several cultural capitals, which is another avenue for potential growth, he added.

The company continues to be organized around the three pillars of events and experiential production; creative and communications services, and influence, spanning media, public relations and cultural initiatives.

“We are a fully integrated group. It’s not only about business; it’s about value,” he said. “Because we are really optimists about the future too. We have a lot of things to do worldwide, and we have a lot of potential.”

Mazarine also owns Numéro magazine, while Reiffers is the founder of Reiffers Initiatives, a foundation that supports the young French contemporary art scene.

The company has developed Mazarine Intelligence and built its own generative AI, which it uses to create ultra-personalized VIC experiences for its luxury clients.