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Federal Communications Commission
1919 - M Street, N.W.
Washington, D.C. 20554
News media information 202 / 418-0500
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Internet: http://www.fcc.gov

This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).

Report No. IN 98-55 INTERNATIONAL ACTION October 22, 1998

(IB DOCKET 98-192)

The Commission seeks comment on the legal, economic, and policy ramifications of permitting direct access to the INTELSAT system in the United States. Direct access to INTELSAT would enable U.S. carriers and users to obtain space segment capacity directly from INTELSAT rather than through Comsat, the U.S. Signatory to INTELSAT.

The Commission tentatively concluded that the Communications Satellite Act of 1962 and the Communications Act give it discretion to permit U.S. carriers and users the option of obtaining contractual, or Level 3, direct access to the INTELSAT system. The Commission did not, however, reach tentative conclusions as to whether and under what circumstances the Commission may permit direct access.

INTELSAT offers two levels of direct access to its space segment communication services, which are referred to as Level 3 and Level 4 direct access. Level 3 direct access permits customers to enter into a contractual agreement with INTELSAT for ordering, receiving, and paying for INTELSAT space segment capacity at the same rate that INTELSAT charges its Signatories. Level 4 direct access permits customers in INTELSAT member countries to make capital investments in INTELSAT in proportion to utilization of the INTELSAT system. Ninety-three countries permit some level of direct access.

The Commission noted that U.S. carriers and users of INTELSAT services have urged the Commission to permit direct access to the INTELSAT system. U.S. international service carriers, the television networks, and earth station operators contend that direct access would give them greater choice and lower rates for INTELSAT services. Comsat has opposed direct access, contending that it would not allow fair recovery of its costs and is not permitted under the Communications Satellite Act of 1962. Last April, when the Commission issued its decision reclassifying Comsat as a non-dominant carrier for services to competitive markets, it stated that it would expeditiously initiate a separate proceeding to consider direct access.

In this NPRM, the Commission requests comment on issues in the following areas: (1) what are the potential benefits of direct access?; (2) what competitive concerns are raised by direct access?; and (3) how would direct access affect U.S. efforts to privatize INTELSAT?

Action by the Commission, October 22, 1998, by Notice of Proposed Rulemaking (FCC 98-280). Chairman Kennard, Commissioners Ness, Furchtgott-Roth, Powell and Tristani.

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News Media contact: Rosemary Kimball at (202) 418-0500.

International Bureau contact: James Ball at (202) 418-0427 and Sande Taxali at (202) 418-7586.