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Cablegate: Berlin Gnss Telematics Conference: Galileo Feeling

VZCZCXRO2012
PP RUEHAG RUEHAST RUEHDF RUEHHM RUEHLN RUEHLZ RUEHMA RUEHPB RUEHPOD
RUEHTM
DE RUEHRL #0897 1901547
ZNR UUUUU ZZH
P 081547Z JUL 08
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC PRIORITY 1612
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUCNFRG/FRG COLLECTIVE
RUEHBS/AMEMBASSY BRUSSELS 0552
RUEHBS/USEU BRUSSELS

UNCLAS BERLIN 000897

SENSITIVE

SIPDIS, STATE FOR EUR/AGS, EUR/ERA AND EB/IFD/OMA

E.O. 12958: N/A
TAGS: EAIR ECON EINV ETRD PGOV PREL TSPA EUN NL GM
SUBJECT: BERLIN GNSS TELEMATICS CONFERENCE: GALILEO FEELING
THE 2013 HEAT

REF: A. 07 MUNICH 652
B. BERLIN 142
C. BRUSSELS 310
D. BERLIN 247
E. BERLIN 264

1. (SBU) The 2nd GNSS Technologies and Telematic
Applications Conference, held June 12, 2008, highlighted a
paradigm shift in Galileo's business philosophy to generate
revenue and openness to foreign procurement. Galileo
representatives admitted that the goal of having a complete
and operational Galileo satellite constellation by 2013 is
"very ambitious". They also expressed concern regarding
EU/Chinese GNSS (Global Navigation Satellite System)
cooperation.

GALILEO BUSINESS PLAN FOCUSING ON DOWNSTREAM REVENUE
--------------------------------------------- --------
2. (SBU) Mr. Rainer Grohe, former Head of Galileo Joint
Undertaking, and Mr. Carlo des Dorides, Head of Programs
Department EU GNSS Supervisory Authority (GSA), both
commented that industry feedback projects the Galileo
commercial signal will not be a significant source of
revenue. Rather, Galileo management is now focusing on the
downstream economic stimulus Galileo that will provide as a
primary revenue source. Grohe said the EU GNSS market
expansion resulting from the Galileo signal is now expected
to exceed 140,000 EU jobs and stated there is no indication
that a market exists for an encrypted commercial service (CS)
signal. Grohe said the original Galileo driving force of
EU/GPS independence is now "ridiculous" and that Galileo's
success rests on user application services.

GALILEO OPENING PROCUREMENT TO CONTRACTORS OUTSIDE THE EU
--------------------------------------------- ------------
3. (SBU) The GSA has softened its position on
Galileo-related contracts being awarded exclusively within
the EU. Dorides commented privately that in the interest of
keeping the Galileo schedule on track, the GSA has adopted a
more flexible posture, allowing contracts to be awarded on a
subcontractor basis (not as a primary bidder) outside the EU.
Dorides specifically noted that using US contractors with
ample satellite experience would be a likely scenario. The
German newspaper Handelsblatt reported on Monday June 16 that
the US aerospace group Boeing is taking part in discussions
with a view towards eventually participating in the Galileo
project.

GALILEO AND COMPASS ON A FREQUENCY COLLISION COURSE
--------------------------------------------- ------
4. (SBU) China's GNSS candidate (Compass) and the EU's
(Galileo) are playing a game of chicken over the issue of
frequency filings, and dialogue and negotiations to resolve
this matter have been thus far unsuccessful. (COMMENT: The
current Chinese frequency selection would overlay on
Galileo's encrypted Public Regulated Service (PRS) and would
potentially limit the EU's options when it comes to NAVWAR
situations. END COMMENT.) Grohe commented that there has
been no resolution yet on the frequency overlap issue, adding
that China is "playing a real game of hardball" on this issue
and they are "not backing down." In addition, Grohe
commented on the EU perception that China's interest in
Galileo is largely based a thirst to attain access to the
core Galileo technologies. According to Grohe, China's
interest in Galileo is motivated by their goal of siphoning
EU satellite technologies to speed up their own R&D process
in constructing Compass. Grohe added, the EU position is not
necessarily to disallow Chinese participation in Galileo, but
rather to ensure that their participation is limited to an
external role (denying Chinese access to core Galileo
technologies such as Galileo's atomic clock).

POLITICAL PRESSURE THE REAL DRIVING FORCE BEHIND GALILEO
--------------------------------------------- -----------
5. (SBU) On the margins of the conference, Dr. Paolo
Mulassano, a GNSS researcher at the Instituto Superiore Mario
Boell - Italy, told Global Affairs officer the real drive
behind Galileo is political and not the result of a private
industry need for a second GNSS signal. Mulassano welcomed
the presence of a second viable GNSS signal, but added that
it is questionable whether Galileo's investment cost is worth
it. Mulassano added, the 3.4 billion euro price tag is
essentially the cost to prove the EU can successfully
collaborate on a technical project on the scale of Galileo.
TIMKEN JR

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