Developments in International Satellite Communications in the International Space Year
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DEVELOPMENTS IN INTERNATIONAL SATELLITE COMMUNICATIONS IN THE INTERNATIONAL SPACE YEAR Deemed the International Space Year,' 1992 con- ("Comsat") was created by Congress in the 1962 tinued to bring forth material developments in the Communications Satellite Act ("CSA")6 and was au- rapidly expanding world of international satellite thorized to serve as the United States private sector communications. Not only has the transmission of commercial participant in the International Tele- voice and data become competitive, but with the communications Satellite Organization ("INTEL- technological advances of direct broadcast services, SAT").' Comsat enjoyed a monopoly position over video compression, high data rate computer services international satellite communications from the and high definition television, among others, the en- United States for nearly thirty years. Today, Comsat tire satellite market appears primed for a technologi- no longer stands alone as the sole provider of satellite cal explosion.2 communications services in the United States. Radi- The development of such services and similar ones cal technological advances over the thirty years since providing interactive capabilities will greatly increase the implementation of the CSA have enabled com- choices in personal communications.' The once fu- petitors to enter the satellite services market, a devel- turistic concepts of telecommuting4 and virtual real- opment consistent with the United States' policy "not 5 ity are fast becoming today's reality. Modern satel- ...to preclude the creation of additional communi- lite technology enables the remote rancher in cations satellite systems . .. ."' Australia or the climber in the Andes to be in touch Congress created Comsat with the passage of the with the outside world within seconds. This capabil- CSA.' The goal was to create a commercial corpora- ity creates monumental opportunities for third world tion which would operate as a part of the global countries, where cable and fiber optic lines have yet communications network"0 and serve as the United to be laid. Indeed, it is quite possible persons will be States' signatory to INTELSAT and the Interna- able to communicate via satellite with virtually any- tional Maritime Satellite Organization ("INMAR- one in the world by the early twenty-first century. SAT"). Since its inception, Comsat has been regu- The Communications Satellite Corporation lated as a common carrier by the Federal ' Lloyd Covens, The Year Ahead: Satellite's Bright Vista, Kobielus, Virtual Reality May Transform Future Multimedia SATELLITE COMM., Jan. 1992, at 17. Interfaces, NETWORK WORLD, Feb. 25, 1991, at 33. 2 Id. ' Communications Satellite Act, 47 U.S.C. §§ 701-744 ' The term "personal communications services" or "PCS" is (1991) [hereinafter CSA]. a term used often in the arena of emerging technologies. PCS is ' The United States entered into the INTELSAT Agree- a regulatory definition-a generic umbrella for a variety of mo- ment on February 12, 1973. "INTELSAT is a cooperative bile services. It does not define the various technologies involved. whose members make capital contributions commensurate with Margie Semilof, Here Come the PCNs, COMMUNICATIONS their use of the system." Senior Interagency Group on Interna- WEEK, Nov. 18, 1991, at 26. tional Communication and Information Policy White Paper on " "Telecommuting . [is] the use of telecommunications New International Satellite Systems, p.2 1 (Feb. 1985) [hereinaf- technology to partially or completely replace the commute to and ter SIG White Paper]; see CSA § 102(a), 47 U.S.C. § 701(a). from work." It is estimated that "the number of home based 8 CSA § 102(d), 47 U.S.C. § 701(d). telecommuters in the United States has increased 2.5 times in ' The stated policy goal of the CSA is an "improved global the past four years, from 2.2 million in 1988 to 5.5 million [cur- communications network, which will be responsive to public rently] (4.4 percent of the workforce)." Patricia L. Mokhtarian, needs and national objectives, which will serve the communica- Telecommuting in the United States: Letting Our Fingers Do tion needs of the United States and other countries, and which the Commuting, TR NEWS, Jan.-Feb. 1992, at 2-3. will contribute to world peace and understanding." CSA ' "Virtual reality architectures almost literally invite users to § 102(a), 47 U.S.C. § 701(a). step into the world defined by the system. Sophisticated 1/O [in- 10 Id. put/output] devices, such as touch screens, goggles, heads up dis- " Congress passed the International Maritime Satellite plays and data gloves, enable users to view and manipulate elec- Telecommunications Act designating Comsat the United States tronic information and images in three dimensions." James representative. "Such system shall have facilities and services COMMLAW CONSPECTUS [Vol. 1 Communications Commission ("FCC" or "Commis- sues surrounding low-earth orbiting ("LEO") satel- sion")' 2 under rate-of-return regulation. The rate- lites, including Motorola's IRIDIUM and INMAR- of-return model of regulation, or cost-of-service, is SAT's Project 21. Lastly, this Comment analyzes the intended to prevent an entity with market power direction in which technology and competition will from exercising monopoly power over the drive regulation as the United States heads into the marketplace." twenty-first century. The arrival of competitors to the international sat- ellite environment may induce the Commission to al- I. FIXED-SATELLITE SERVICE ter or abandon that regulatory model as competition grows. Today, there are a myriad of companies, such A. Pan American Satellite: An Emerging as AT&T, Columbia, Ellipsat, Loral-Qualcomm, Competitor Motorola, Orbital, PanAmSat, and TRW, vying for 1. PamAmSat's Judicial Attempt to Even the Play- the international as well as domestic satellite com- munications market. 4 As these and other firms enter ing Field the market and mature, regulators will be forced to PanAmSat has assumed the role of Comsat's prin- consider whether the current activist economic regu- cipal rival in the newly competitive international sat- lation should be largely replaced by increased reli- ellite industry. Hoping to break Comsat's former ance on market forces. monopoly over the domestic and international satel- This Comment focuses on several important and lite communications market, it has repeatedly as- timely issues of international satellite communica- serted, before both courts and regulators, that Com- tions law. Current international satellite issues can sat's conduct is monopolistic and predatory and that be divided between the fixed-satellite and mobile-sat- INTELSAT's treaty status is obsolete. 5 ellite services. Those divisions correspond to the On July 25, 1989, PanAmSat filed an antitrust physical characteristics of the receiving station and complaint against Comsat in the United States Dis- the frequencies each type of system utilizes in trans- trict Court for the Southern District of New York. 6 mitting messages over its facilities. In the fixed-satel- The complaint was dismissed' on the ground that, lite arena, Pan American Satellite's ("PanAmSat") as a signatory to INTELSAT, Comsat was immune relationship with both Comsat and INTELSAT and from suit under Article XV of the INTELSAT resulting industry ramifications are analyzed. Recent agreement' 8 and the International Organizations Im- regulation of direct broadcast service ("DBS") and munities Act.' 9 However, the court pointed out that related technological issues are also examined. Next, antitrust prohibitions nevertheless related to Com- this Comment studies the mobile-satellite service, sat's role as a common carrier because § 102 of the particularly the frequency, technical, and political is- CSA contained an antitrust consistency clause.20 which will serve maritime commercial and safety needs of the New, Private Enterprise INTELSAT, (Apr. 20, 1992) [herein- United States and foreign countries." International Maritime after PanAmSat White Paper]; Petition to Reopen Proceeding in Satellite Communications Act, 47 U.S.C. §§ 751-57, at 751(a) the Corporate Structure and Operations of the Communications (1988). Satellite Corporation, CC Docket No. 80-634, Rpt. No. 1-6691 12 CSA § 401, 47 U.S.C. § 741. (May 12, 1992) (on file with CommLaw Conspectus). " In Re Policy and Rules Concerning Rates for Dominant 11 See Alpha Lyracom, Complaint Jury Trial Demand, Carriers, Notice of Proposed Rule Making, 2 FCC Rcd. 5208, supra note 15. para. 17 (1987). 17 Alpha Lyracom Space Communications, Inc. v. Commu- 14 Price, Schedule are Keys; Rocket Companies Gear Up nications Satellite Corp., 68 Rad. Reg. 2d (P&F) 405 (1989) For $2 Billion in Satellite Launces, COMM. DAILY, Nov. 28, [hereinafter Alpha Lyracom]. 1988, at 2. Several of the traditional equipment suppliers of 18 "[Elach Party shall grant to these individuals [Parties, NASA, such as McDonnell Douglas, Martin Marietta and Gen- representatives of parties, Signatories and representatives of sig- eral Dynamics, have entered the competitive launch market as natories] immunity from legal process in respect of acts done and have some small start-up companies, like Orbital Sciences. words written or spoken in the exercise of their functions and Launches may also be provided by foreign entities, such as Eu- within the limits of their duties . " Article XV(c), Int'l Tele- rope's Arianespace. communications Satellite Organization, Aug. 20, 1971, 23 " Alpha Lyracom Space Communications, Inc. v.