Exploring the Unknown - NASA's History Office

Specifically, this report concludes that—
(a) Additional international satellite facilities should be permitted by the FCC, provided
they satisfy conventional regulatory requirements, but the new entrants must be
restricted to providing customized services, as defined in this report. When one or more
authorities abroad authorizes use of such new systems, the United States with those
authorities will enter into consultation procedures with INTELSAT under Article XIV(d)
of the INTELSAT Agreement. Construction permits may be issued at the conclusion of
regulatory proceedings to those applicants meeting the public interest requirements of
the Communications Act. Final licenses and authorizations should not be issued, however,
until after INTELSAT consultation is completed.
(b) The FCC should examine allowing U.S. carriers and users in addition to the
Communications Satellite Corporation (Comsat) to have cost-based access to the
INTELSAT space segment for customized services. This matter can be pursued on a parallel
track, as the pending applications are being processed, however, and does not constitute
a condition to FCC action on these applications.
(c) The United States should, and will, maintain its full commitment to INTELSAT,
while permitting technology-driven competition in this important sector to evolve. . . .
[50] Conclusion
EXPLORING THE UNKNOWN 149
The applications to establish additional international satellite systems now pending
before the FCC presented four options. The Executive [branch] could have recommended
(1) approval, (2) denial of the applications outright, (3) approval of the applications
subject to specific qualifications, or (4) further study, with postponement of any decision
for an indefinite period. The unanimous view among the member agencies represented
on the SIG is that it would be in the U.S. national interest to allow new providers of international
satellite facilities, provided INTELSAT were not exposed to significant economic
harm. The President’s determination reflects this view.
There is sufficient risk of significant adverse economic impact on INTELSAT to make
blanket approval of unrestricted competition unwise. It would also be premature to take
such a step until the results of cost-based access, new fiber optic cables, and new
INTELSAT services are fully evaluated. Unrestricted entry could ultimately undermine
the economic integrity of this important international enterprise, which would be inconsistent
with the U.S. national interest.
[51] The case has not been made for flatly disapproving the existing applications. The
new entrants have made a threshold showing that services they propose are not now available
on comparable terms. Limited entry along the lines recommended would further
U.S. international trade interests, promote technological progress, and be consistent with
national defense and security interests as well. Given these limitations, and the restrictions
likely to be placed on any new satellite system by telecommunications authorities abroad,
the risk of any significant adverse impact on INTELSAT is exceedingly small.
Further study and resulting delay [are] unlikely to further the national interest. Over
a year of extensive study and review by the Executive branch has already taken place. This
review has not resulted in the submission of credible information supplied by anyone,
including INTELSAT and Comsat, which demonstrates plausible adverse effects. There is
no basis to assume such information will be forthcoming.
Satellite systems entail significant lead time. Time is required to secure the requisite
spacecraft, to reach launch agreements, and to secure operating arrangements. U.S. regulatory
procedures are generally more time consuming than those abroad, where decisions
can sometimes be reached and implemented without the regulatory proceedings
and protracted court appeals characteristic of U.S. regulation. Consultation with
INTELSAT is also required. Even were the pending applications approved by the FCC
immediately, service would not be available for some time.