**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+----+------------------------------+
| In the Matters of                | *  | File No.                     |
|                                  | *) | SAT-STA-20050203-00018       |
| EchoStar Satellite LLC           | ** |                              |
|                                  |    | Call Sign: S2658             |
| Request For Special Temporary    | *  |                              |
| Authority for the                | *) | File No.                     |
|                                  | ** | SES-LFS-20050203-00133       |
| EchoStar 5 Satellite             |    |                              |
|                                  | *  | Call Sign: E050029           |
| EchoStar Satellite LLC           | *) |                              |
|                                  | ** |                              |
| Request for Blanket Authority to |    |                              |
| Operate 1,000,000 Earth Stations | *  |                              |
| to receive DBS programming from  | *) |                              |
| the Canadian BSS orbital slot at | ** |                              |
| 129° W.L.                        |    |                              |
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+----------------------------------+----+------------------------------+

**ORDER AND AUTHORIZATION**

**Adopted: June 30, 2005 Released: June 30, 2005**

By the Deputy Chief, Satellite Division, International Bureau:

# introduction

1.  By this Order, we grant EchoStar Satellite LLC's ("EchoStar")
    application for Special Temporary Authority ("STA") to relocate its
    EchoStar 5 satellite from current orbital location of 119° W.L. to
    the 129° W.L. orbital location.[^1] This request is pursuant to an
    agreement between EchoStar and Ciel Satellite Communications, Inc.
    ("Ciel"). We also grant EchoStar's request for a blanket
    authorization for 1,000,000 receive only earth stations, which will
    be used to provide additional "local-into-local,"[^2] high
    definition, and other signals to U.S. consumers using the EchoStar 5
    satellite.[^3] The EchoStar 5 satellite will operate at the 129º
    W.L. orbital location pursuant to a Canadian space station
    authorization issued to Ciel.

# BACKGROUND

## The Transaction between EchoStar and Ciel 

2.  The proposed relocation of EchoStar 5 is pursuant to an agreement
    between EchoStar and Ciel concerning the use of EchoStar 5 at an
    orbital location assigned to Canada under the ITU Region 2 Plans for
    the BSS and associated feeder-links.[^4] EchoStar agreed to move the
    EchoStar 5 satellite to the 129° W.L. orbital location, subject to
    necessary governmental approvals. The agreement provides EchoStar
    with an exclusive right to use all of the capacity on the EchoStar 5
    satellite at the 129° W.L. orbital location until at least September
    30, 2008. Under the agreement, EchoStar may, under certain
    circumstances, move the EchoStar 5 satellite to one of its
    Commission licensed orbital locations[^5], in the event that
    EchoStar 5 is needed to replace some or all of the capacity of
    certain EchoStar satellites due to an anomaly or anomalies in
    EchoStar's fleet. Additionally, as provided for in the agreement,
    operations of the EchoStar 5 satellite may continue for a period of
    time at the 129° W.L. orbital location, under certain circumstances,
    including the launch failure of a planned follow-on satellite. That
    satellite is expected to be launched by the end of 2008.

3.  The agreement contemplates that, once EchoStar 5 is at the 129º W.L.
    orbital location, it will be under Ciel's direction and control.
    Telemetry, tracking, and control functions (TT&C functions) will be
    performed, under Ciel's direction, using Earth stations located in
    the United States and licensed to EchoStar for EchoStar 5's entire
    term of service under the agreement. On February 2, 2005, Industry
    Canada provided Ciel with an approval in principle to develop and
    operate a broadcast-satellite space station at the 129° W.L. orbital
    location.[^6]

## B. Procedural History {#b.-procedural-history .unnumbered}

4.  On February 3, 2005, EchoStar filed both its STA request to relocate
    the EchoStar 5 satellite and its request for a blanket Earth station
    authorization. On February 4, 2005, EchoStar filed a copy of a
    preliminary agreement with Ciel and requested that it be withheld
    from public inspection pursuant to Sections 0.457 and 0.459 of the
    Commission's rules.[^7] The Satellite Division issued a Public
    Notice of EchoStar's STA request on March 4, 2005.[^8] Separately,
    on April 6, 2005, we issued a Public Notice of EchoStar's request
    for a blanket Earth station authorization.[^9] On April 4, 2005, the
    Bureau sent a letter to EchoStar requesting a definitive agreement
    and further technical information concerning the EchoStar 5 STA
    application.[^10]

5.  On May 4, 2005, EchoStar submitted a partial response to the
    Bureau's letter[^11] and on May 11, 2005, EchoStar submitted the
    remainder of its response to the Bureau's letter along with copy of
    its definitive agreement with Ciel, requesting confidential
    treatment for certain portions of the agreement.[^12] The Bureau
    made a follow-up request for additional technical information on May
    24, 2005.[^13] EchoStar responded on May 31, 2005.[^14] No parties
    commented on either the STA or blanket earth station license
    applications.

# DISCUSSION

6.  We find that granting the STA and associated blanket earth station
    authorization is in the public interest. These actions will provide
    satellite capacity for the provision of additional local-into-local,
    high definition, and other programming to its subscribers and would
    further EchoStar's plan to provide its local-into-local programming
    in each market on a single satellite dish pursuant to the Satellite
    Home Viewer Extension and Reauthorization Act of 2004 (SHVERA),[^15]
    thereby improving the quality of service to U.S. consumers.[^16] We
    discuss below the basis for this conclusion.

7.  *DISCO II Framework.* The Commission\'s *DISCO II Order* adopted a
    framework under which the Commission would consider requests for
    non-U.S. licensed satellite systems to serve the United States.[^17]
    To implement this framework, the Commission, among other things,
    established a procedure by which a service provider in the United
    States could request immediate access to a foreign in-orbit
    satellite that would serve the U.S. market.[^18] This procedure
    requires the service provider to apply for an earth station license
    that would list the foreign satellite as an authorized point of
    communication. Under the *DISCO II* framework, for direct-to-home
    services such as those involved in this case, we examine whether
    there are effective competitive opportunities for U.S. licensed
    satellites to serve the home market of the non-U.S. satellite
    seeking access to the United States. In particular, we examine
    whether there are *de jure* or *de facto* barriers to entry for the
    provision of analogous service, and whether any such barriers would
    cause competitive distortions in the United States. These factors
    are considered together with other public interest considerations to
    determine whether grant of the request would serve the public
    interest.

8.  *DBAC, DirecTV 5, and Competition Issues*. The *DISCO II* framework,
    as applied in the *DBAC* and *DirecTV 5* cases[^19] is relevant in
    this case. In *DIRECTV 5,* as here, we authorized a U.S. DBS space
    station operator to move its satellite to a Canadian-authorized
    orbital position to provide direct-to-home service to the United
    States. In finding that authorization to be in the public interest,
    we relied on the *DBAC* case. In *DBAC,* we authorized a U.S. earth
    station operator to access a Canadian-authorized satellite to
    provide direct-to-home service to the United States. In finding that
    authorization to be in the public interest, we first examined
    whether there were *de jure* or *de facto* barriers to entry in the
    Canadian market for services analogous to the services DBAC was
    seeking authority to provide in the United States. We found that
    such *de jure* barriers do exist. However, we also concluded that
    there was a compelling public interest justification for authorizing
    such service in the United States, and that grant of the
    authorization would enhance, rather than distort or harm,
    competition in the United States. Similarly, in *DirecTV* 5, we
    concluded that the benefits from grant of DIRECTV's proposal were
    compelling and warranted favorable action.

9.  In *DBAC*, we considered, first, whether competitive distortions
    might result from authorizing DBAC to provide the services proposed.
    We found that competitive distortions would be likely to result only
    under a number of conditions: (1) through use of the Canadian
    satellites, the Applicant would have access to cost savings,
    subsidies or quality-enhancing assets not available to other U.S.
    service providers; (2) those cost savings, subsidies, or
    quality-enhancing assets would be sufficiently large to enable the
    Applicant to offer prices and quality of services that would cause
    some or all of the incumbent U.S. DTH/DBS providers to exit the
    market; (3) following exit of some or all of the domestic DTH/DBS
    providers, the Applicant would be able to raise the price of service
    to U.S. customers; and (4) entry barriers exist such that neither
    the incumbent U.S. DTH/DBS providers or new U.S. DTH/DBS providers
    could enter the market, thereby defeating the price increase.[^20]
    We also noted that competitive distortions related to predatory
    pricing are a rare phenomenon, in part because of the high risk that
    they will be unsuccessful.[^21] In this case, as in *DIRECTV* 5,
    while this authorization will provide EchoStar with access to
    quality-enhancing assets, i.e., satellite capacity for the provision
    of local-into-local and other services in additional markets in
    which EchoStar is not currently providing these services, there is
    no evidence that this access will create a competitive distortion by
    allowing EchoStar to carry out a predatory strategy.

10. In *DBAC*, we then considered whether there was a compelling public
    interest justification for authorizing service. We found that, since
    DBAC had not yet entered the markets for DBS or multi-channel video
    programming distribution (MVPD) services, authorization of DBAC to
    provide these services using Canadian satellites would increase
    competition in DBS services and in MVPD services generally.[^22]
    Here, we find that there is a compelling public interest
    justification for granting EchoStar's application because, as
    EchoStar states in its request, it will facilitate EchoStar's
    efforts to provide more local-into-local, high-definition, and other
    programming, and to transition its "two-dish" markets to one dish
    for all local television broadcast station signals offered in each
    market.[^23] EchoStar further states that allowing it to provide
    this additional programming from the 129° W.L. orbital position will
    enable EchoStar to compete more effectively with established cable
    operators in the MVPD market.[^24] Finally, grant of this request
    will allow EchoStar to operate at an orbital location that was not
    previously available to consumers in the United States.[^25]
    Inasmuch as there is no competitive distortion associated with this
    authorization and grant of this authorization will facilitate the
    increase in provision of local broadcast channel service, we find
    that the benefits associated with grant of EchoStar's proposal are
    compelling and warrant approval of this request.

11. *International Coordination/Relationship to DBS Spacing Issues*. The
    ITU Region 2 Plans for the BSS and associated feeder-links includes
    an assignment to Canada at the 129° W.L. orbital location. There are
    no co-frequency U.S. BSS assignments within 9 degrees of the 129°
    W.L. orbital location, and no current BSS operations by any country
    within 9 degrees of the 129° W.L. orbital location. Therefore,
    operations at the 129° W.L. orbital location will not disrupt or
    degrade any currently operating DBS service.

12. *Exchange of Letters with Industry Canada.* We have exchanged
    letters with Industry Canada in order to ensure that there is a
    mutual understanding regarding the operation of the EchoStar 5
    satellite. The understandings, and the factual background for these
    understandings, are provided as Annex A and are material
    considerations for the authorization contained in this Order. In
    general, the exchange of letters indicates that EchoStar 5 space
    station operations at the 129° W.L. orbital location will be
    pursuant to authorization of Ciel by Industry Canada.

13. *Disposition of the EchoStar 5 FCC License*. EchoStar 5 will not be
    operating pursuant to a Commission authorization once it begins
    operating at the 129° W.L. orbital location. Accordingly, we are
    terminating the EchoStar 5 license (Call Sign S2658), effective upon
    EchoStar 5 reaching the 129° W.L. orbital location.

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IV. **CONCLUSION AND ORDERING CLAUSES**

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14. Based on the foregoing, we find that grant of EchoStar's requests
    will serve the public interest by improving the quality of
    local-into-local, high definition, and other satellite services to
    its subscribers.

15. Accordingly, IT IS ORDERED, that the application of EchoStar
    Satellite LLC File No. SAT-STA-20050203-00018 (Call Sign: S2658) is
    GRANTED, and EchoStar Satellite LLC is authorized for a period of 60
    days to relocate EchoStar 5 from the 119º W.L. orbital location to
    the 129° W.L. orbital location and to conduct space station
    Telemetry, Tracking and Command communications during the movement
    of the satellite to the 129° W.L. orbital location, subject to the
    following conditions:

    i.) EchoStar Satellite LLC shall coordinate all drift orbit
    Telemetry, Tracking, and Control operations with other potentially
    affected in-orbit operators.

    ii.) During relocation of the EchoStar 5 satellite, EchoStar
    Satellite LLC's operations shall be on a non-harmful interference
    basis, i.e., EchoStar Satellite LLC shall not cause interference to,
    and shall not claim protection from interference caused to it by,
    any other lawfully operating satellites.

    iii.) In the event that any harmful interference is caused as a
    result of EchoStar Satellite LLC's operations during the relocation
    of the EchoStar 5 satellite, EchoStar Satellite LLC, shall cease
    operations immediately upon notification of such interference and
    shall inform the Commission in writing immediately of such an event.

16. IT IS FURTHER ORDERED, that, pursuant to Section 25.137 (c) of the
    Commission's rules, the application of EchoStar Satellite LLC, File
    No. SES-LFS-20050203-00133, IS GRANTED, and EchoStar Satellite LLC
    IS AUTHORIZED, until December 31, 2008, to use 1,000,000
    receive-only Earth stations to receive transmissions in the
    12.2-12.7 GHz frequency band from the EchoStar 5 satellite at the
    129° W.L. orbital location, which is licensed to Ciel Satellite
    Communications, Inc. by Industry Canada, consistent with the
    technical parameters specified in its application, and subject to
    the following condition:

    i.) Operations shall be consistent with applicable coordination
    agreements; to the extent such agreements have not been reached,
    operations shall be on a non-harmful interference basis, i.e.,
    operations of the EchoStar 5 satellite shall not cause interference
    to, and shall not claim protection from, interference caused to it
    by any other lawfully operating satellites.

17. IT IS FURTHER ORDERED, that, effective upon the date when the
    EchoStar 5 satellite reaches the 129° W.L. orbital location, the
    license for that satellite (Call Sign S2658) IS TERMINATED.

18. EchoStar Satellite LLC shall inform the Commission, through a letter
    to the Chief, Satellite Division, FCC, within five business days
    following the date on which the EchoStar 5 satellite reaches the
    129° W.L. orbital location.

19. EchoStar Satellite LLC is afforded thirty days to decline these
    authorizations as conditioned. Failure to respond within this period
    will constitute formal acceptance of the authorizations as
    conditioned.

20. This Order is issued pursuant to Section 0.261 of the Commission's
    rules, 47 C.F.R. § 0.261 and is effective upon release.

    FEDERAL COMMUNICATIONS COMMISSION

    Cassandra C. Thomas

    Deputy Chief, Satellite Division

    International Bureau

    **Annex A**

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[^1]: The term "129° W.L. orbital location," as used in this Order,
    refers to the nominal orbital position for the relevant Canadian
    frequency assignment under the International Telecommunication Union
    ("ITU") Region 2 Plan for BSS and Feeder Link Assignments, as
    contained in Appendix 30/30A of the Radio Regulations, and to any
    specific orbital location within the cluster defined by such
    assignment.

[^2]: The term "local-into-local," as used in this Order, refers to
    provision via satellite retransmission of local television broadcast
    signals to subscribers who reside in a local television station's
    market, which is defined as a Designated Market Area, or "DMA".
    *See* 17 U.S.C. § 122(j)(2)(A).

[^3]: This action is taken pursuant to Section 25.132 of the
    Commission's Rules. *See* 47 C.F.R. § 25.132(j) (requiring
    receive-only Earth stations that would operate with non-U.S.
    licensed space stations to request a license). Any Earth station
    authorizations required for tracking, telemetry, and command
    functions in connection with operations of the EchoStar 5 satellite
    will be addressed separately.

[^4]: The Plan for the Broadcasting-Satellite Service (BSS) in the Band
    12.2-12.7 GHz in Region 2 is contained in Appendix 30 of the ITU
    Radio Regulations, and the associated Plan for the feeder-links in
    the frequency band 17.3-17.8 GHz for the broadcasting-satellite
    service in Region 2 is contained in Appendix 30A of the ITU Radio
    Regulations.

[^5]: EchoStar holds licenses to operate satellites pursuant to the U.S.
    assignments for the 61.5, 110, 119, 148, and 157º W.L. orbital
    locations under the ITU Region 2 Plan for BSS and Feeder Link
    Assignments.

[^6]: EchoStar STA Request at Exhibit 2. Also available at:
    http://strategis.ic.gc.ca/epic/internet/insmt-gst.nsf/vwapj/ciel-e.pdf/\$FILE/ciel-e.pdf.

[^7]: 47 C.F.R. §§ 0.457, 0.459. *See* EchoStar Satellite LLC, Request
    for Blanket Authority to Operate 1,000,000 Earth Stations to receive
    DBS programming from the Canadian BSS orbital slot at 129° W.L. and
    to conduct Telemetry, Tracking and Command Operations in order to
    Relocate EchoStar 5 to this Orbital Location.

[^8]: Report No. SAT-00275 (released March 4, 2005)

[^9]: Report No. SES-00701 (released April 6, 2005.

[^10]: Letter from Thomas S. Tycz, Chief, Satellite Division,
    International Bureau, to Pantelis Michalopoulos, Counsel for
    EchoStar, dated April 4, 2005, regarding File No(s). SAT-
    SAT-20050203-00018.

[^11]: Letter from Pantelis Michalopoulos, Counsel for EchoStar to
    Thomas Tycz, Chief, Satellite Division, dated May 4, 2005, File No.
    SAT-STA-20050203-00018, submitting a partial response and requesting
    a one week extension of the Bureau's deadline for responding to its
    April 4, 2005 letter.

[^12]: Letter from Pantelis Michalopoulos, Counsel for EchoStar to
    Thomas Tycz, Chief, Satellite Division, International Bureau, dated
    May 11, 2005, File No. SAT-STA-20050203-00018.

[^13]: Letter from Thomas S. Tycz, Chief, Satellite Division,
    International Bureau regarding File No(s).  SAT- SAT-20050203-00018,
    dated May 24, 2005.

[^14]: Letter from Pantelis Michalopoulos, Counsel for EchoStar to
    Thomas Tycz, Chief, Satellite Division, International Bureau, dated
    May 31, 2005, File No. SAT-STA-20050203-00018. EchoStar requested
    confidential treatment for the attachment to the response letter.

[^15]: 47 U.S.C. § 338 as amended by *The Satellite Home Viewer and
    Reauthorization Act of 2004*, Pub. L. No. 108-447, 118 Stat 2809,
    3393 (2004).

[^16]: EchoStar will continue to be considered a "DBS provider,"
    pursuant to Section 25.701 of the Commission's Rules, 47 C.F.R. §
    25.701, in connection with the operations of the EchoStar satellite
    at the 129º W.L. orbital location.

[^17]: *See* Amendment of the Commission\'s Regulatory Policies to Allow
    Non-U.S. Licensed Satellites Providing Domestic and International
    Service in the United States, *Report and Order*, IB Docket No.
    96-111, 12 FCC Rcd 24094 (1997) (*DISCO II* or *DISCO II Order*).

[^18]: *See DISCO II*, 12 FCC Rcd at 24174, ¶ 186. For a more detailed
    summary of the *DISCO II* framework, *see* Amendment of the
    Commission\'s Regulatory Policies to Allow Non-U.S.-Licensed Space
    Stations to Provide Domestic and International Satellite Service in
    the United States*, First Order on Reconsideration,* IB Docket No.
    96-111, 15 FCC Rcd 7207, 7209-10, ¶ 4-5 (1999) (*DISCO II First
    Reconsideration Order*).

[^19]: Digital Broadband Applications Corp*.*, *Order*, 18 FCC Rcd 9455
    (Int'l. Bur. 2003) (*DBAC*)*.* DirecTV Enterprises, LLC, Request for
    Special Temporary Authority for the DIRECTV5 Satellite, *Order and
    Authorization*, 19 FCC Rcd 15529 (Int'l. Bur. 2004) (*DirecTV 5*)*.*

[^20]: *DBAC* at 9462-63, ¶ 16.

[^21]: *Id*.

[^22]: *Id*.

[^23]: EchoStar 5 STA at 4. "Two-dish" markets are those that require
    the direct-to-home subscriber to use two satellite dish antennas to
    receive all local television broadcast signals in a market.

[^24]: *Id*. at 5.

[^25]: *Id*. at 5-6.