Nokia Oyj (NOK.US) and satellite startup ICEYE plan to build a secure European communications system in orbit for defense and security purposes, seizing on the continent's increasingly urgent demand for sovereign services.
The partnership is expected to launch up to 50 low Earth orbit (LEO) satellites annually starting in 2028, according to Nokia CEO Justin Hotard and ICEYE CEO Rafal Modrzewski, who spoke in a joint interview. Targeting government clients, the two companies will provide ground terminals and satellites designed to work in conjunction with land-based networks, keeping armed forces, first responders and government ministries connected during disruptions.
"Moving from just radio communications and mobile communications to sensing and mission-critical connectivity is an incredible opportunity," Hotard said, adding that communications are increasingly involving observation and detection at the same time. European governments are pushing to build their own satellite capabilities following strained relations with the United States during the Trump administration. The European Union said in August that it is expanding its IRIS² sovereign satellite program, aiming to create a unified service that does not rely on foreign suppliers.
This push comes as Elon Musk's Starlink, which operates the world's largest satellite communications constellation, has said it could challenge U.S. telecom carriers by competing directly for customers. Some of Nokia's ground operator clients in the U.S. and Europe have begun discussing forming joint ventures to bid for satellite spectrum in an upcoming auction, seeking to retain control over this emerging connectivity layer. Nokia is expanding beyond its core mobile network infrastructure, investing in satellite and data center equipment. The company's focus on AI infrastructure, combined with an investment from AI chip developer Nvidia (NVDA.US), has driven its share price up about 65% this year.
"This is probably one of the biggest shifts in ICEYE's overall strategy," Modrzewski said, adding that ICEYE is entering a new market that he estimates is larger than the intelligence satellite services market. ICEYE is among a group of emerging space companies benefiting from Europe's sovereignty push and growing demand for defense-related services. The company raised 450 million euros ($511 million) in June at a valuation of 10 billion euros. Earlier this month, it signed a letter of intent with Polish state-owned defense manufacturer PGZ SA to build a Polish military satellite communications system. Modrzewski said this was "one of the demand signals that triggered this development."