Opinion ID: 524251
Heading Depth: 3
Heading Rank: 2

Heading: FCC's Prior Rulings on Earth Station Ownership

Text: 14 The Commission first addressed the question of earth station ownership in 1965, in anticipation of the launch of Early Bird, the first of the INTELSAT satellites. Report and Order, Proposed Global Commercial Communications Satellite System, 38 F.C.C. 1104 (1965), reconsideration denied in pertinent part, Memorandum Opinion and Order, Proposed Global Commercial Communications Satellite System, 2 F.C.C.2d 658 (1966). The FCC licensed the three then-existing earth stations to Comsat alone. Shortly thereafter, the Commission revised its policy so that the existing earth stations (then totalling six) would be jointly owned by a consortium of carriers consisting of Comsat and certain common carriers who provided overseas communications services. Second Report and Order, Ownership and Operation of Earth Stations, 5 F.C.C.2d 812 (1966). The Commission designated Comsat manager of the consortium and guaranteed it a fifty-percent ownership share in each earth station. The members of the consortium thereafter entered into the Earth Station Ownership Agreement, which, among other things, established the Earth Station Ownership Committee, or ESOC, to formulate policy and make earth station design decisions. The policy enunciated in 1966 remained in effect until 1984, when in Report and Order, Modification of Policy on Ownership and Operation of U.S. Earth Stations, 100 F.C.C.2d 250 (1984), the Commission opted for a liberalized earth station ownership policy which permits the construction and operation of earth stations outside of ESOC. Id. at 265. The practical effect of this new competitive earth station ownership policy, id. at 276, was that common carriers could own and operate earth stations independently, i.e., without Comsat's management and co-control. 15
16 Before the Commission modified its earth station ownership policy in 1984, it for the first time licensed exclusively to an individual common carrier an earth station to provide IBS services. International Relay, Inc., FCC No. 84-125 (April 11, 1984), J.A. at 31. The Commission found the rationale supporting its extant earth station policy inapposite to the licensing of earth stations providing IBS as opposed to multipurpose service: 17 [I]ndependent carrier ownership of IBS earth stations does not raise the same issues as raised by multipurpose earth stations.... [T]he unique technical characteristics of the IBS offering remove any need for us to evaluate the impact of multiple IBS earth stations on the INTELSAT system. 18 Id. at 8 n. 7, J.A. at 38. Independent carrier licensing was, according to the FCC, consistent with previous Commission decisions favoring the introduction of new and innovative international services. Id. at 10, J.A. at 40 (citation omitted). In a companion ruling issued the same day, the FCC granted Comsat's similar application to build and operate independently an earth station which would provide IBS service. Communications Satellite Corp., FCC No. 84-125 (April 11, 1984). 19
20 In 1986, the Commission ruled that earth stations incapable of transmitting signals, receive-only earth stations, may receive INTELSAT's inbound, or INTELNET I, service without individual licensing or authorization from the FCC. Declaratory Ruling, Deregulation of Receive-Only Satellite Earth Stations Operating with INTELSAT, FCC No. 86-214 (May 19, 1986) (Receive Only ), reprinted in Brief for Respondent at Attachment. It found that the Satellite Act did not prevent authorization of entities other than Comsat or common carriers to deploy receive-only earth stations for use in connection with INTELNET I service. Id. at 6. The Commission reasoned that 21 Section 201(c)(7) [governs] ... substantial earth-station facilities that were expected to be operated as part of common-carrier service offerings. Section 201(c)(7) was not aimed at and does not limit our discretion in deciding the ownership or regulatory treatment of earth stations which have no transmitting capability and which are not connected to a common-carrier network. Congress simply did not address services such as INTELNET I that are designed for direct-to-user transmission and which, accordingly, contemplate the use of small, receive-only earth stations such as those [being considered]. Accordingly, we believe that we have authority [under Title III of the Communications Act] to authorize entities other than Comsat or the carriers to own and use earth stations for inbound INTELNET I service. 22 Id. at 10 (footnote omitted). 23