The Galileo positioning system (never abbreviated GPS) is a planned satellite navigation system, intended as a European alternative to the United States Global Positioning System (which is abbreviated GPS).
It was agreed upon officially on May 26, 2003 by the European Union and the European Space Agency. The system is intended to be primarily for civil use, unlike the US system. The US reserves the right to limit the signal strength of the GPS systems so that non-military users can't use it, or to shut down GPS completely, in time of conflict. The precision of the signal available to non-military users was limited before 2000 (a process known as selective availability). The European system will not (in theory) be subject to shutdown for military purposes, will provide a significant improvement to the signal available from GPS, and will be available at its full precision to all users, both civil and military.
The European Commission had some difficulty trying to secure funding for the next stage of the Galileo project. Its states were wary of investing the necessary funds at a time where budgets were threatened across Europe. Some states, such as France, strongly supported Galileo as a means of having technological independence from the United States. Other states felt that it may be better to continue getting the service for free from the US, than paying for it themselves. The United States, after the September 11, 2001 Terrorist Attack against them, wrote to the European Union opposing the project since it would defeat the usefulness of the US ability to shut down GPS in times of military operations. On January 17, 2002 the spokesman for the project said that "Galileo is almost dead" as a result of this pressure.
A few months later, however, the situation changed dramatically. Partially due to the pressure exerted by the US, EU member states realized the importance of having their own independent positioning and timing infrastructure. All EU member states became strongly in favour of the Galileo system in late 2002 and, in fact, the project became actually over-funded, which posed a completely new set of problems for the companies involved.
The European Union and European Space Agency then agreed in March 2002 to fund the project, pending a review in 2003 (which was finalized on May 26, 2003). The starting cost is EUR 1.1 billion until the year 2005. The required satellites - planned number is 30 - will be launched between 2006 and 2008 and the system will be working, under civilian control, from 2008. The final cost is estimated at EUR 3 bn, including the infrastructure on earth which is to be built in the years 2006 and 2007. At least two thirds of the cost is planned to be invested by companies and private investors, the remaining costs are divided between the ESA and the EU. An encrypted higher bandwidth Commercial Service with improved accuracy will be available at an extra cost, while the base Open Service will be freely available to all as with GPS.
As well as a technological achievement and practical tool, Galileo will be a political statement of EU technological independence from the United States. In the technological independence aspect, a strong motivator is the policy of the US to accept only US companies to deliver technology and equipment for the GPS.
The European geostationary navigation overlay system (EGNOS) is intended to be a precursor to Galileo. EGNOS is a system of satellites and ground stations intended to increase the accuracy of the current GPS and GLONASS in Europe. Eventually, they will be used for Galileo, too.