FOR IMMEDIATE RELEASE NEWS MEDIA CONTACTS:

September 15, 1999 ROSEMARY KIMBALL (202) 418-0511

MORGAN BROMAN (202) 418-0256

**COMMISSION INCREASES COMPETITION FOR OVERSEAS LONG- DISTANCE
SERVICE:**

**ALLOWS DIRECT ACCESS TO USERS OF**

**INTELSAT SATELLITE SERVICES FROM THE UNITED STATES**

**(IB DOCKET 98-192)**

Washington D.C. -- As part of its ongoing effort to increase competition
in telecommunications, the Commission has adopted a policy allowing
United States users of International Telecommunications Satellite
Organization (\"INTELSAT\") satellite services to have direct access to
the INTELSAT system. This important action promotes competition in
international satellite communications and strengthens the
competitiveness of U.S. carriers and service providers in the global
communications market. This follows Commission-ordered reductions in U.
S. long-distance access charges that have greatly reduced consumer
long-distance telephone calling rates.

As a result of the Commission action, the United States joins 94 other
countries that already permit users of the INTELSAT system to access
directly the INTELSAT satellite system rather than having to go through
a national Signatory. Previously, U.S. users had to go through Comsat
Corporation ("Comsat") exclusively to gain access to INTELSAT.
Inter-exchange carriers, broadcast networks, and earth station operators
will now be able to order, receive, and pay INTELSAT for use of
satellite services at the same rates that INTELSAT charges its
Signatories. As a result, U.S. companies will be able to compete on a
level playing field with foreign companies that already have direct
access to the INTELSAT system.

INTELSAT is a 143 member intergovernmental organization that owns and
operates a global system of satellites. It is located in Washington,
D.C. INTELSAT has and will remain a key provider of satellite
transmission capacity for both U.S. commercial and governmental use.

In adopting this policy, the Commission concluded that direct access
will benefit U.S. INTELSAT customers, who will gain a cost savings of
between 10 and 71 percent off Comsat tariff rates, and achieve greater
efficiency, flexibility, and control over facility use. The Commission
also noted that direct access will put competitive pressure on Comsat
rates and the rates of competing satellite operators, and enhance the
ability of U.S. carriers to compete globally with their counterparts
that obtain capacity directly from INTELSAT.

Because Comsat must continue to incur expenses in its role as the U.S.
Signatory to INTELSAT, the Commission will now require direct access
customers to pay Comsat a surcharge of 5.58 percent of the INTELSAT
utilization charge to recover those expenses. The surcharge will be
collected through a tariff to be filed by Comsat.

In addition, to guard against unfair competitive distortions in the U.S.
market, the Commission limited direct access participation for those
INTELSAT Signatories or affiliates that control or use 50 percent or
more of all the INTELSAT capacity consumed in a Signatory's respective
home market. Signatories limited in this manner, however, however, will
still be allowed direct access from the United States to locations other
than these dominant markets. This limitation will remove the incentive
for Signatories to reduce direct access prices to uneconomic levels --
i.e., levels that do not reflect INTELSAT's full costs of providing
direct access in the U.S. market \-- by supporting the lowering of
INTELSAT tariff rates.

The FCC decided not to grant requests of carriers seeking fresh look at
long term carrier contracts with Comsat for INTELSAT space segment
capacity, concluding that the carriers had not met the standard for
fresh look. The Commission also decided not to act on carriers' requests
for portability of their INTELSAT capacity, obtained through Comsat,
because the current record is insufficient. The Commission, however,
said it would consider the issue of portability if direct access
customers demonstrate that Comsat's control of space segment capacity
prevents realization of direct access benefits.

The FCC noted that Congress is considering legislation on the issue of
direct access to INTELSAT. While the Commission's decision in this
proceeding is based on current law, it recognizes that Congress retains
the prerogative to legislate in this area. Congressional action clearly
would supersede any inconsistent action taken in this proceeding in the
interim.

Action by the Commission September 15, 1999, by Report and Order (FCC
99-236). Chairman Kennard, Commissioners Ness, Furchtgott-Roth, Powell
and Tristani with Commissioner Furchtgott-Roth issuing a separate
statement.

> -FCC-

International Bureau contacts: Peter Pappas at (202) 418-0746; Jim Ball
at (202) 418-0427, Doug Webbink at (202) 418-1494; and Michael McCoin at
(202) 418-0774.

Report No. IN 99-28