SATELLITE COMPANIES FILE MILESTONE DOCUMENTS WITH FCC
FCC continued crackdown on milestone compliance for satellite companies, requiring 8 Ka-band licensees to produce documentation of contracts by Feb. 8 deadline. In Jan. 28 letter from Tom Tycz, chief of International Bureau Satellite & Radiocommunication Div., Ka-band licensees Astrolink, EchoStar, Hughes, Loral, Motorola, PanAmSat, Teledesic and WB Holdings were given until deadline to show proof milestones had been met with noncontingent contracts for construction of satellites. All of companies except Hughes and Motorola said they had met milestones. Hughes wasn’t available for comment. Motorola filed request for waiver while application to transfer license to Teledesic was pending. FCC said at start of rulemaking that companies failing to meet milestones would lose licenses.
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Tough new Commission stance on milestones wasn’t unexpected, attorneys and industry sources said. Each of companies contacted received first-round licenses for Ka-band service in May 1997, plus extensions. Each of licensees has service that will operate with intersatellite service links, prompting more extensions. PanAmSat lost 2 orbital slots last summer and NetSat another, but regained it on appeal. Debate on slots also centered on slots owned by EchoStar and VisionStar. Warehousing was another issue raised by companies seeking licenses for similar services in Ka-band. “This is the pulling of the bull to see if they have signed contracts,” Coudert Bros. analyst Tim Logue told us: “This is an encouraging sign.” Logue said Commission waited 19 months “to get after NetSat. He said letter demonstrated FCC was going to “promptly find out if people are meeting milestones.”
New standard form letter now is part of official procedure, attorneys said. “You can draw your own conclusions,” said attorney Joseph Godles. Until recently, many milestones were taken for granted, attorneys said. “They have done this in the past,” Motorola attorney Phillip Malet said: “The Commission appears to be more vigilant than they have been in the past.” He said it was “all a question of enforcement in the last few years.” Malet said Motorola, which was required to have contract for construction of first satellite by Jan., filed for waiver until Commission could act on transfer request: “We don’t believe they should take any license because FCC hasn’t acted. We hope they see the equity in the situation.”
Enforcement is “reflection” of “scarcity of satellite spectrum,” attorney William Wilshire said: “More and more people are now paying attention to it.” FCC is doing this because “they want to be seen as tough,” Teledesic attorney Mark Grannis said: “When milestones come up, they are trying to make sure everyone is meeting them.” However, Grannis was concerned about proprietary contracts’ becoming public: “One of the troubling parts of this is there is no good reason to share this information with competitors. We hope the FCC understands we don’t want every dog and cat looking at our contracts.”