By Kathleen Q. Abernathy
October 26, 2017 at 5:00 am ET
In 1989 I joined Comsat Corp., a company created by the 1962 Communications Satellite Act and the designated U.S. representative to the intergovernmental consortiums of Intelsat and Inmarsat. The mission was to own and manage the first constellation of international communications satellites. The risk associated with launching and operating a global satellite system was so great and the viability of the project so uncertain that government participation was essential.
Fast-forward to my time as an FCC commissioner when I voted in favor of a 2003 order that opened the door to allow satellite companies the flexibility to use their spectrum for ancillary terrestrial wireless service. From a policy perspective, the FCC’s intent was clear: (1) allow maximum efficient use of spectrum by permitting satellite companies to gap fill areas with a terrestrial component, (2) ensure that the satellite network remained the core business, and (3) avoid harmful interference to existing satellite networks from the new terrestrial wireless service. As the end of 2017 approaches, I have watched the saga involving LightSquared (now renamed Ligado post-bankruptcy) and am troubled by the company’s recent advocacy about why the FCC voted to allow “ancillary” terrestrial service in the first place. Given the importance of maintaining the integrity of the FCC’s spectrum allocation rules and policies, and ensuring effective satellite communications capabilities, I want to set the record straight.
So what’s all the fuss about? It’s about preserving existing satellite networks, avoiding harmful interference and preventing the manipulation of FCC rules. The FCC’s 2003 vote to allow satellite companies to use their spectrum for limited terrestrial service was based on the requests of Craig McCaw-backed ICO Global and Mobile Satellite Ventures (a predecessor to Ligado). They approached the FCC with a proposal that would strengthen the economic basis for critical satellite operations by supplementing coverage with a terrestrial capability. The plan was not to create an opportunity for satellite companies to shed their historical roots and jump on the wireless bandwagon. If that were the case, the FCC would have simply held an auction and sold the spectrum to the highest bidder. Instead, we offered the satellite licensees the opportunity to explore the viability of an “Ancillary Terrestrial Component” and established rules to ensure satellite service remained paramount.
Equally important was facilitating the economic viability of the satellite industry by protecting against harmful interference. The FCC accomplishes this by ensuring that similar services are placed in the same spectrum neighborhood. That is why the FCC placed satellite licensee Ligado next to other satellite operators. Introducing a fundamentally different service – terrestrial wireless service – as Ligado desires, in the middle of the satellite spectrum neighborhood, has the potential to cause massive interference to its satellite neighbors. For example, Ligado’s airwaves neighbor the GPS spectrum band and spectrum used by satellite companies, like Iridium and Inmarsat.
Ligado’s proposal (which is far from a gap-filling exercise) has triggered numerous objections. Although Ligado negotiated settlements with some commercial GPS providers, many in the GPS community still have legitimate concerns. For example, leading satellite provider Iridium Communications has raised red flags about interference and the aviation community has also objected given its reliance on GPS and satellite communications for safety services. Even users of satellite weather data services have raised objections.
In 2003 some were skeptical that the terrestrial service would remain ancillary. One of my fellow commissioners even argued that “our decision raises the possibility of unintended consequences – our decision should not allow a Mobile Satellite Services (MSS) system with an ancillary terrestrial component to evolve into a terrestrial system with an ancillary mobile satellite component.” I appreciate that the FCC‘s satellite gating criteria made the economics for implementing ancillary terrestrial service challenging. One satellite company warned the FCC that “[t]here is no question that terrestrial operations in the MSS bands – coordinated with satellite operations – are technically feasible; the issue is whether they can be conducted on an economically viable basis without threatening, through interference, the viability of the satellite services.”
Which brings us to today. Fourteen years after adopting these rules, not a single ATC service has been deployed. No company has been able to fully comply with the 2003 rules and those that have tried have gone bankrupt at least once (Ligado included) after seeking waivers of the FCC’s rules. Although the Commission’s effort to provide flexibility was sound spectrum policy and intended to improve the overall business economics, it didn’t work.
Ligado’s response has been a rejection of its core satellite business and the pursuit of a series of FCC waiver requests that chip away at the ATC service rules. Today the company is seeking the authority to operate a terrestrial-only service, gutting completely any notion that its wireless operations will be ancillary to underlying satellite services. This is not what the FCC voted to support in 2003. Thus, it was pretty stunning to read a recent Ligado attack on one of its critics, claiming that they are attempting to “relitigate the 2003 ATC Order” by objecting to Ligado’s proposed service. If anyone is trying to revisit the 2003 ATC Order, it is the company seeking to abandon any requirement that it operate a satellite service at all.
The MSV/LightSquared/Ligado saga is a good case study for policymakers. Sometimes our best designs don’t pan out. Sometimes the very concerns that people raise when we push the regulatory envelope do result in unintended consequences. When that happens, regulators must look back to the goals of the original policies, consider the new facts and enforce the rules consistent with public policy goals. In this case, Ligado is attempting to rewrite the rules to the detriment of GPS and a fast-growing satellite service. That’s certainly not what we voted for in 2003 and not something the FCC should allow today.
Kathleen Abernathy is special counsel at Wilkinson Barket Knauer LLP and served as a commissioner at the FCC from 2001 to 2005. Wilkinson Barker Knauer serves as regulatory counsel to Iridium Communications, Inc.
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