FCC TO ISSUE KA-BAND ORDER FOR SATELLITE LINKS AND MILESTONES
FCC could issue 11 Ka-band rulemaking and orders as early as today (Wed.), Commission spokesman said. Decisions would grant intersatellite link (ISL) authorizations and impose construction milestones on several Ka-band licensees. New milestones would require companies holding licenses to sign construction contracts for Ka-band satellites within one year and begin launch operations shortly thereafter or face losing licenses unless there were “extenuating circumstances” that forced delays, spokesman said: “The idea is milestones that are established should be kept.” Actions could set tone for 2nd-generation broadband market, industry sources said, and companies are working privately on compromise to stave off FCC-mandated order.
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Ka-band spectrum, which is largely unused, has become more valuable for companies seeking to start next-generation commercial broadband services. Hughes received licenses for 20 Ka-band orbital slots and PanAmSat 2. Satellite leaders Loral, Lockheed Martin and GE Americom also received first round allocation. Total of 50 Ka-band orbital slots, including 20 prime Conus slots, were licensed to 12 companies in May 1997.
CAI Wireless, DirectCom, Motorola, Pegasus and TRW are among companies seeking Ka-band slots in 2nd round of processing. In July, FCC was urged by 8 congressional leaders, plus satellite operators, to review licenses of companies they accused of warehousing spectrum (CD July 31 p1). Commission waived antiwarehousing rules to assign several licenses into more than one orbital location to encourage service to rural and remote areas, but in doing so promised stringent enforcement of construction milestones so it could reclaim licenses from companies that didn’t begin service promptly. Companies without slots are hoping new milestones will free up orbital slots that could be reassigned, but cautioned some of slots that would become available were less desirable. Pegasus Senior Vp John Hane has suggested repeatedly that FCC inaction could lead to U.S. orbital slots’ being reclaimed by ITU. U.S. hold on slots expires in 2004.
Concrete milestones weren’t issued along with original licenses 3 years ago because international domestic work needed to be completed, spokesman said. When licenses were first issued, FCC linked construction milestones to some licenses in first round of applications, but decided not to impose milestones on companies that asked to use intersatellite links as part of their proposed systems. In June, Commission lifted licenses of Morning Star, NetSat28 and PanAmSat for failing to meet milestones (CD June 28 p6). Companies appealed decision and are awaiting final ruling from Commission.
Hane told us he was “absolutely thrilled” FCC was “poised to act.” He said decision could mean “momentum on all issues” along with efforts by Pegasus to bring advanced services to rural areas. However, Hane said he felt ISL order was “too late to have much impact” on 2nd-round applicants. “If it had been done a year ago, the 2nd round would be settled by now.” PanAmSat attorney Henry Goldberg told us impending decision on construction milestones and ISLs wasn’t totally unexpected: “I think the Commission has been heading in this direction for a while. Once they pulled authorizations, this is the 2nd shoe to drop.” He said industry had been expecting FCC action: “They have been getting a lot of pressure from the outside… The timing doesn’t strike me as rush to judgment. This was bound to happen.”