When in operation, it will have two ground operations centers, one near Munich, Germany, and another in Fucino, 130 km east of Rome, Italy. Since 18 May, 2007, at the recommendation of Transport Commissioner Jacques Barrot, the EU took direct control of the Galileo project from the private sector group of eight companies called European Satellite Navigation Industries, which had abandoned this Galileo project in early 2007.
Galileo is intended to provide more precise measurements than available through GPS or GLONASS (Galileo will be accurate down to the metre range), better positioning services at high latitudes and an independent positioning system upon which European nations can rely on even in times of war or political disagreement, since Russia or the USA could disable use by others (through encryption). Like GPS, use will also be free for everyone.
Named for the Italian astronomer Galileo Galilei, the positioning system is officially referred to as just "Galileo". It is also sometimes colloquially described as the "Galileo positioning system"; however, since this abbreviates to GPS, the shorter name is preferred to avoid confusion with the U.S. GPS.
The European Commission had some difficulty getting money for the project's next stage, as economic difficulty was threatening national budgets across Europe. Following the September 11, 2001 attacks, the United States Government wrote to the European Union opposing the project, arguing that it would end the ability of the United States to shut down GPS in times of military operations. On January 17, 2002 a spokesman for the project somberly stated that, as a result of U.S. pressure and economic difficulties, "Galileo is almost dead." A few months later, however, the situation changed dramatically. Partially in reaction to the pressure exerted by the U.S. Government, European Union member states decided it was important to have their own independent satellite-based positioning and timing infrastructure.
The European Union and the European Space Agency agreed in March 2002 to fund the project, pending a review in 2003 (which was finalised on May 26, 2003). The starting cost for the period ending in 2005 is estimated at €1.1 billion. The required satellites—the planned number is 30 — will be launched throughout the period 2006–2010 and the system will be up and running and under civilian control from 2010. The final cost is estimated at €3 billion, including the infrastructure on Earth, which is to be constructed in the years 2006 and 2007. The plan was for private companies and investors to invest at least two-thirds of the cost of implementation, with the EU and ESA dividing the remaining cost. An encrypted higher-bandwidth Commercial Service with improved accuracy would be available at an extra cost, with the base Open Service freely available to anyone with a Galileo-compatible receiver.
In June 2004, in a signed agreement with the United States, the European Union agreed to switch to a range of frequencies known as "Binary Offset Carrier 1.1," allowing both EU and US forces to block each other's signals in the battlefield without disabling the entire system. The European Union also agreed to address the "mutual concerns related to the protection of allied and U.S. national security capabilities.
Early 2007, the EU had yet to decide how to pay for the system and the project was said to be "in deep crisis" due to lack of more public funds. German Transport Minister Wolfgang Tiefensee, was particularly doubtful about the consortium's ability to end the infighting at a time when only one of the 30 planned satellites had been successfully launched.
Although a decision was yet to be reached, EU countries on Friday the 13th of July 2007 discussed cutting €548m ($755m, £370m) from the union's competitiveness budget for next year and shift some of that cash to other parts of the financing pot, a move that could meet part of the cost of the union's Galileo satellite navigation system. European Union research and development projects could be scrapped to overcome a funding shortfall for Europe's rival to the US GPS.
In November 2007, it was agreed to reallocate funds from the EU's agriculture and administration budgets and to soften the tendering process in order to invite more EU companies.
In April 2008, the EU transport ministers approved the Galileo Implementation Regulation. This allowed the €3.4bn to be released from the EU's agriculture and administration budgets. This will allow the issuing of contracts to start construction of the ground station and the satellites.
In July 2004, Israel signed an agreement with the EU to become a partner in the Galileo project.
On November 30, 2007, the 27 member states of the European Union unanimously agreed to move forward with the project, with plans for bases in Germany and Italy. Spain did not approve during the initial vote, but approved it later that day. This greatly improves the viability of the Galileo project: "The EU's executive had previously said that if agreement was not reached by January 2008, the long-troubled project would essentially be dead.
Galileo is going to be a civilian system that allows anybody to use it. GPS is a US military system that was designed to provide location signals of the greatest possible accuracy to US military users, while also providing location signals to civilian users. Thus far, the US has had the capability to block the "civilian" signals while still being able to use the "military" signal. There also was (and technically as of early 2008 still exists) the possibility to degrade the "civilian" signals by introducing errors to make them less accurate and thus significantly less useful to non-US military users, a process called selective availability. Since Galileo was designed to provide its greatest possible accuracy (possibly greater than GPS) to anybody, the US was concerned that a hypothetical enemy could militarily use Galileo signals in strikes against the US. The frequency initially chosen for Galileo would have made it impossible for the US to block the (accurate) Galileo signals without also interfering with their accurate "military" GPS signals. The US did not want to lose the ability to themselves use accurate GNSS while denying enemies the use of accurate GNSS. Some US officials became especially concerned when Chinese interest in Galileo was reported. This is what led to some US officials to go as far as threatening to potentially shoot down Galileo satellites in the event of a conflict. The EU for a long time held the stance that Galileo was a neutral technology, available to all countries, with no military able to only deny their opponents the use of highly accurate GNSS. For a time, EU officials were considerably unsympathetic towards the US' desire to maintain their ability to use accurate GNSS for military purposes while denying non-US forces access to equally accurate GNSS. However, this EU-US standoff was eventually resolved by the EU agreeing to make Galileo use a different frequency, and the US would be able to locally interfere with/block the Galileo signals at the new frequency without interfering with their "military" GPS signals. In theory however, the "military" GPS signals could also be interfered with/blocked by a suitably equipped adversary, but interfering with either Galileo's signals at the new frequency or "military" GPS signals doesn't automatically block the other.
On May 1, 2000, the President of the United States signed an order disabling SA, and in late 2001, the entity managing GPS confirmed that the intent is never to re-enable selective availability.
Though Selective Availability still exists, on 19 September 2007, the US Department of Defense announced that they would not procure any more satellites capable of implementing Selective Availability. This means the next wave of Block IIF satellites launching in 2009 will no longer support SA. As older satellites are deorbited and replaced, as part of the GPS modernization programme, SA will cease to exist. The modernisation programme also contains standardised features that allow GPS III and Galileo systems to inter-operate, allowing a new receiver to utilise both systems to improve accuracy.
In addition, the Galileo satellites will be able to detect and report signals from Cospas-Sarsat search-and-rescue beacons in the 406.0–406.1 MHz band, which makes them a part of the Global Maritime Distress Safety System.
In 2004 the Galileo System Test Bed Version 1 (GSTB-V1) project validated the on-ground algorithms for Orbit Determination and Time Synchronisation (OD&TS). This project, led by ESA and European Satellite Navigation Industries, has provided industry with fundamental knowledge to develop the mission segment of the Galileo positioning system.
From mid-2006, the GIOVE Mission (GIOVE-M) segment is exploiting the GIOVE-A satellite to provide experimental results based on real data to be used for risk mitigation for the IOV satellites that will follow on from the testbeds. The GIOVE Mission will also provide experimentation results based on GIOVE-B and GIOVE-A2 satellites. The GIOVE Mission segment is operated by European Satellite Navigation Industries for the European Space Agency (ESA).
The AGILE project is an EU-funded project devoted to the study of the technical and commercial aspects of Location-based Services (LBS). It includes technical analysis of the benefits brought by Galileo (and EGNOS); also studying the hybridisation of Galileo with other positioning technologies (network-based, WLAN, etc.). Within these project, some pilot prototypes were implemented and demonstrated.
On the basis of the potential number of users, potential revenues for Galileo Operating Company or Concessionaire (GOC), international relevance, and level of innovation, a set of Priority Applications (PA) will be selected by the consortium and they will be developed within the time frame of the same Project.
These applications will help to increase and optimise the use of the EGNOS services as well as the opportunities offered by the Galileo Signal Test-Bed (GSTB-V2) and the Galileo (IOV) phase.