Invest1 publisher2 min readPublished
Space42 and Viasat commit $1 billion to satellites in a region that budgets $2.5 billion a year
Gulf space money is moving off government budget lines and onto corporate balance sheets, where Space42's venture with Viasat now sits. KPMG's projection to 2034 is for slower growth than the decade behind it.
The Investor · Invest desk
What happened
- A KPMG report puts Middle East and North Africa space budgets at $1.4 billion in 2015 and $2.5 billion in 2025, a rise it describes as 69%, with the UAE, Saudi Arabia, Qatar and Oman as the main spenders.
- The same report projects regional space spending of $3.2 billion by 2034, which it calls a 30% increase on 2025 levels.
- Space42 signed a binding agreement with Viasat to establish Equatys, a platform connecting phones and devices directly to satellites, with up to $1 billion of equity committed between the two companies.
- Equatys will run a shared satellite and ground network for multiple telecom and satellite operators, starting with fewer than 200 satellites and planning to reach 2,800.
- Space42 added three synthetic-aperture-radar satellites developed with Finland's ICEYE to its Foresight constellation in June, with integration and testing done at its Abu Dhabi facility.
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Why it matters
- contradiction KPMG's forward projection implies about 2.8% growth a year to 2034 against roughly 6% a year over the previous decade, so anyone sizing a supplier pipeline off the 69% headline is reading the faster half of the series.
- constraint At the 2,800-satellite target, the committed equity works out to about $357,000 a satellite, so the expansion needs debt, operator contributions, or a smaller fleet than the plan.
- decision Telecom and satellite operators in the region now have a rentable alternative to financing their own constellation, and Hazlett's account of the shared model is that each participant carries less of the infrastructure burden.
- exposure Soliman's account makes ground installations the exposed asset and orbital capacity the hedge. That gives a Gulf buyer a resilience case for satellite spending, with no commercial return attached.
KPMG's two endpoints do not produce KPMG's percentage. From $1.4 billion in 2015 to $2.5 billion in 2025 is a rise of about 79%, not the 69% the report gives [1][14]; a 69% rise off $1.4 billion would have finished near $2.37 billion [15]. The report does not explain the gap, and across a region of separate national budgets rounding could cover most of it.
The Space42 commitment sits outside those budget lines. Space42 and Viasat committed up to $1 billion of equity to Equatys [6], equal to 40% of what regional governments spent on space in 2025 [18] and 31% of what KPMG expects them to spend in 2034 [19].
Divide that equity by the opening fleet of fewer than 200 satellites and it comes to about $5 million each [21]. The plan is 2,800, fourteen times the start [7][22].
Mohammed Soliman, a senior fellow at the Middle East Institute [25], told Fortune: "What both companies are trying to sell is proximity to terrestrial pricing at unprecedented scale." [8] Anna Hazlett runs the UAE firm AzurX, which has advised Blue Origin in the Middle East since 2021 [10]. She said: "Each participant carries less of the infrastructure burden while potentially gaining better coverage, performance and availability." [9]
Fortune reports the regional investment is driven by more than the prospect of commercial returns [23]. Soliman put the security case in terms of what stayed up. "The Iran conflict has demonstrated that data centers and radar installations can be disrupted or degraded, while satellites remain operational and on station," he told Fortune [5]. He also said the Gulf's spending on space infrastructure "is a logical trajectory" [26].
Space42's own build is consistent with that. The three radar satellites feed its GIQ platform, which Space42 says can cut emergency response times by up to 90% [13]. In July the company tested direct-to-device SMS and emergency SOS on Android phones in the UAE with California-based Skylo [12].
Fortune reports that Saudi Arabia's Public Investment Fund and the UAE's Mubadala have made space a strategic investment priority, without a figure attached to either [4]. If those funds are carrying the spend off budget, the KPMG series undercounts the flow, and a sharp upward revision to the 2034 projection would be the evidence [2]. The other way this goes wrong is on the network side. If Equatys signs enough third-party operators, the shared platform funds its own expansion and the up-to-$1-billion equity is a first tranche [6][7].
What to watch
- A revision to KPMG's $3.2 billion 2034 figure, or a disclosed commitment number from PIF or Mubadala, would change how much of the Gulf's space spending is actually on budget.
- How many third-party telecom and satellite operators sign onto the Equatys shared network, and on what terms.
- Whether the Space42 and Skylo direct-to-device tests convert into a commercial service priced anywhere near terrestrial mobile rates.