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^6=X\\===\====\\\\\\\\\\==\nnzni=Qzfznn\fnnff===\\=\\Q\Q3\\33Q3\\\\FF3\QzQQFQ\Q\0\\\\\=\\\\\\\\\3n\n\n\n\n\zzQnQnQnQnQ=3=3=3=3z\\\\\\\\\fQn\\\\fQ\n\n\n\n\yQyQz\z\nnQn\n\nQ\\\\\\\>3\\\\=\\\\z\g3gBf\g3g3y\ny\z\\\znFnFn\\F\F\F\\gBg3f\\\\\\\zf\gFgFgF\f\z\\\f\f\n=\\===WxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN\\\=\UU\\\\\\@\\\\@==\\\33\\pp\\\b\\=\\@"\[\4\==p=\p\f\z\=\Q\iwUzpNm\QQ====pppfpfzQpGfQ\Q=3zQzffzQz\Qpp\p\\fQfQzppfppppp=\ffpQpppp==\\\\p\\\fffp=i\Q=Tgnj}}ccyyTjcc;T;TXFu ?<  QK xP-#c PE37MP#Q` `  hh,Vpp  DA 961942 S-JO #&m PE37&P#   t!V Before the  Federal Communications Commission  Sx-Washington, D.C. 20554 Đd  T-In the Matter of the Applications ofhh^) ` `  ,hh^)  T8 - AT&T CORP.  ,hh^)ppFile Nos.  X 48DSSLA94  T -` `  ,hh^)pp&  X62SATAMEND95  T -` `  ,hh^)pp&  X63SATP/LA95  T -For Authority to Construct, Launch, and)pp&  X64SATP/LA95  T -Operate Space Stations in the Domestic)pp&  X65SATP95  Tq -FixedSatellite Service ,hh^)pp&  X  S-  MEMORANDUM OPINION AND ORDER d  T1-Adopted:  t!V November 20, 1996 hh^ppReleased: November 21, 1996 By the Chief, International Bureau:  T-  Si- Introduction Đd  T-1. ` ` On May 7, 1996, we authorized the construction, launch, and operation of eleven satellites in the domestic fixedsatellite ("domsat") service and assigned them to satellite orbit  T-locations,.# P1<ԍ#c PE37MP#` ` See Assignment of Orbital Locations to Space Stations in the Domestic FixedSatellite Service,  zP -DA 96713 (May 7, 1996) ("May 7 Order").#c PE37MP#(#` . with separate opinions addressing the merits of each application to follow. We issue this  T- MO&O for the authorizations granted to AT&T Corp. to construct, launch, and operate two hybrid  Tz- C/Kubandz3# PM"<ԍ#c PE37MP#` ` For purposes of this opinion, the Cband encompasses the 37004200/59256425 MHz frequency bands; the Kuband encompasses the 11.712.2/14.014.5 GHz bands.(#`  domestic fixedsatellites at the   930 W.L. and    690 W.L. orbital positions, and to construct  TR-one onground spare. These authorizations both partially replace and expand AT&T's satellite capacity and allow it to meet growing customer requirements, while contributing to increased  T -competition in the market for satellite services.  S!- "!0*((%"  S-Background Đd  T-2.` ` In its application, AT&T requested authority to construct, launch, and operate three  T-hybrid C/Kuband inorbit satellites and to construct one onground spare.k# P<ԍ#c PE37MP#` ` AT&T has requested that certain cost and revenue information be treated as confidential.  No  xP-one has opposed this request or questioned AT&T's financial qualifications. Based on the  zP-current record nondisclosure is consistent with our rules. See 47 C.F.R.  0.461. d that(#`  It identified the proposed  T`-satellites as Telstar 5, 6, 7, and 8, respectively.O`# P<ԍ#c PE37MP#` ` AT&T , previously, submitted an application to construct a hybrid satellite identified as Telstar  xP -403, File No. 48DSSLA94. It replaced this proposal with the Telstar 5 application.(#` O GE American Communications ("GE Americom") and Hughes Communications Galaxy, Inc. ("HCG") filed comments concerning AT&T's applications.  T-For the reasons discussed below, in the May 7 Order, we granted in part, and denied in part,  T-AT&T's applications.3d# P <ԍ#c PE37MP#` ` AT&T Corp. and Loral Space and Communications, Ltd. have applied to the Commission for  xP-authority to transfer control of AT&T's Telstar series satellites to Loral. This order is not  zP-intended to prejudge Commission action in that proceeding. See Public Notice, Report No.  xPW-SPB63 (October 23, 1996).  (#`   T-3.` ` Prior to the 1996 domsat processing round, AT&T was authorized to operate three  Tq-domestic fixedsatellites : Telstar 303 (Cband) at 120o W.L.,zq_ # Pp<ԍ#c PE37MP#` ` Telstar 303, to be replaced by Telstar 5, is authorized to operate in an inclined orbit mode  zPI-until December 31, 1997.  See AT&T Corp., 11 F.C.C. Rcd. 10570 (1996). Earlier, Telstar 303 received special temporary authority ("STA") to operate in an inclined orbit mode and  yP-relocate to 120o W.L. due to HCG's launch of Galaxy IX into the 123o W.L. orbit location,  zP-the location previously occupied by Telstar 303. See letter from Thomas S. Tycz, Chief,  xPn-Satellite and Radiocommunication Division, to Mary Jane McKeever, Vice President and General Manager, SKYNET Satellite Services (May 16, 1996). (#` z Telstar 401 (hybrid C/Kuband) at 970  TI -W.L., and Telstar 402R (hybrid C/Kuband) at 890 W.L. It is also authorized to operate the Cband  T" -Aurora II satellite at 139o W.L., pursuant to a joint license with GE Americom." # Pw<ԍ#c PE37MP#` ` GE Americom identifies this satellite as Satcom C5.(#` Ơ Finally, it is authorized to operate the Cband Telstar 302 satellite, which was replaced by Telstar 402R, until its  T -current location 85o W.L. is needed by the satellite most recently assigned to 85o W.L.Hk V# P<ԍ#c PE37MP#` ` GE2 has been assigned this location but it has not yet been launched. See GE American  zP -Communications, Inc., 10 F.C.C. Rcd. 13775 (1995). Telstar 302 is due to go out of service in 1998.(#` H  T - 4.` ` AT&T's new generation satellites will each have 24 Cband transponders and 28 Ku T\-band transponders . The Cband transponders each have a bandwidth of 36 MHz, a space station transmitter power of 16 watts, and a maximum effective isotropically radiated power ("EIRP") of"40*((I"  T-40.3 dBW. # Ph<ԍ#c PE37MP#` ` We emphasize that the Commission expects AT&T Corp. not to exceed the power flux density ("PFD") levels as specified in 47 C.F.R.  25.208(a).(#` Of the twentyeight Kuband transponders, twentyfour have a bandwidth of 27 MHz  T-and four have a bandwidth of 54 MHz. The Kuband transponders have a space station transmitter  T-power of 100 watts and a maximum EIRP of 48.1 dBW. AT&T proposed to provide coverage to the  T-48 contiguous states ("CONUS"), Alaska, Hawaii, Puerto Rico, and the U.S. Virgin Islands. 1# PY<ԍ#c PE37MP#` ` The Kuband transponders will also provide incidental coverage to Canada, Mexico, and the Caribbean.(#` AT&T estimated the cost to construct and launch its four originally proposed satellites and to operate  T8-them for one year to be $950 million. It requested the 930 W.L. orbital location for Telstar 5, 1290  T-W.L. for Telstar 6, and 830 W.L. for Telstar 7. AT&T sought to offer services on a noncommon carrier basis. It proposed to launch Telstar 5 in May 1997, Telstar 6 in November 1998, and Telstar 7 in November 1999.  Tp-5.` ` AT&T asserts that its proposed system will serve as followon capacity for its inorbit  TH -satellites, ensuring continuity of service, providing protection, and meeting the demand of its current  T! -and future customers. It further asserts, in light of its acquisition of Alascom, Inc. , that Telstar 6 is  T -partially earmarked to provide additional and enhanced service to Alaska. k # P3<ԍ#c PE37MP#` ` AT&T was granted approval to purchase Alascom, and its interest in the Aurora II/Satcom C5  zP -satellite, on August 1, 1995. See Alascom Inc., 11 F.C.C. Rcd. 734 (1995). Telstar 6 is being planned as a replacement for Aurora II, which will reach its endoflife in 2001. (#` Ɖ  S -P Discussion  TY-d    S1- A. Telstar 6   T-6.` ` Under our rules, an existing qualified licensee s may be assigned one additional orbit  T-location in each frequency band in which it is authorized to operate.{ # P&<ԍ#c PE37MP#` ` 47 C.F.R.  25.140(g). (#` { No objections were raised  T-regarding AT&T's qualifications to hold a domestic fixedsatellite license for Telstar 6, AT&T has  Ti-been found qualified in the May 7 Order and we , therefore, found that AT&T was legally,  TA-technically, and financially qualified to construct, launch, and operate Telstar 6. An # PO <ԍ#c PE37MP#` ` See 47 C.F.R.  25.140(b).(#` ƃ Accordingly, we  T-granted in the May 7 Order, AT&T's application for an expansion hybrid satellite and assigned  T-Telstar 6 to the 69o W.L. orbit location.  T-7.` ` AT&T Corp intended the Telstar 6 application to, in part, replace the Cband Aurora II/Satcom C5 satellite. GE Americom disputed AT&T's contention that it was entitled to the replacement expectancy for Aurora II. To the contrary, GE had previously applied to replace this  T)-satellite with its own satellite, GE3. We did not have sufficient information before us to determine which party was entitled to the replacement expectancy for this jointly licensed satellite. Since we did" 0*((x" not want to delay authorization of needed satellite capacity pending resolution of this issue, we  T- deferred consideration of AT&T's request to replace Aurora II.1# P@<ԍ#c PE37MP#` ` Inasmuch as we do not now authorize the replacement of Aurora II, we did not assign AT&T an appropriate orbital location in the western portion of the domestic arc. If AT&T, however, is later given authority to replace Aurora II which primarily serves Alaska we will assign it to an appropriate westerly orbital position at that time.(#` Ƶ In doing so, we recognized that the Aurora II/Satcom C5 satellite is scheduled to reach its endoflife in 2001. Given the two to three  T-year construction period for satellites, a replacement would need to be authorized by 1998 or 1999 to ensure continuity of service to customers. While we expect to resolve this issue sooner than that, our  T8-deliberations would be facilitated if the parties would negotiate an agreement. I8# P <ԍ#c PE37MP#` ` We consider an optimally high elevation angle for service to Alaska to be an important objective of the Aurora series of satellites. Consequently, we are concerned with the apparent intent of AT&T and GE to replace the Aurora II/Satcom C5 satellite at a more easterly orbital  xP -location than the current 139o W.L. orbital location, since such a change may not serve the  xP -intended objective of providing adequate service to Alaska. (#` I Accordingly, we  T-require that AT&T Corp. and GE Americom attempt to reach an agreement regarding the replacement of the Aurora II/Satcom C5 satellite within 180 days of the release of this order. If the parties  T-cannot agree they may then ask us to resolve the dispute.  Sp- B . Telstar 5   T -8.` ` AT&T proposed to replace its Cband Telstar 303 satellite with a hybrid C/Kuband  T -satellite, Telstar 5.3 # P<ԍ#c PE37MP#` ` AT&T was granted a 319(d) waiver for Telstar 5 which allowed it to begin construction of that  zP-satellite immediately. See letter from Scott Blake Harris, Chief, International Bureau, to Mary Jane McKeever, Vice President and General Manager, SKYNET Satellite Services (March 9, 1995).(#` Ƹ GE asserted that we should not consider Telstar 5 as a replacement for Telstar  T -303 for two reasons. First, the proposed hybrid involves an additional Kuband  orbit location in  T -excess of that allowed by our rules. } # P<ԍ#c PE37MP#` ` See 47 C.F.R.  25.140(g). AT&T Corp. was granted a total of two Kuband inorbit authorizations in this processing round.(#` Second, AT&T proposes to locate Telstar 5 at an orbital location different from Telstar 303.  T0-9.` ` Generally, the Commission permits licensees to replace retired satellites with new ones. This provides service continuity to customers and assurance to licensees and financiers making  T-capital intensive investments in these systems .(# Pf"<ԍ#c PE37MP#` `  See Assignment of Orbital Locations to Space Stations in the Domestic FixedSatellite Service 3  xP?#-F.C.C. Rcd. 6972 (1988) at n.31 ("1988 Orbital Assignment Order").(#` (  AT&T has requested replacement of the Telstar 303  T-satellite within a reasonable time frame.O# P%<ԍ#c PE37MP#` ` See Licensing Space Stations in the Domestic FixedSatellite Service, 50 Fed. Reg. 36071 (September 5, 1985) at  28.(#` Nevertheless, we acknowledge, as GE points out, that licensees generally replace retired satellites with satellites at the same location. We have, however,"0*((" often authorized replacement satellites at other locations to accommodate a licensee's changing  T-business plans or system design.# P@<ԍ#c PE37MP#` ` No additional orbital locations would be required to accommodate this request.(#` Ʈ   Thus, AT&T's request to operate Telstar 5 at 93o W.L., in itself, would not prevent us from authorizing it as a replacement.  T`- 10.` ` We acknowledge, however, that only the Cband portion of the newly authorized Telstar 5 satellite can be considered a replacement for Telstar 303. Nonetheless, there are cost efficiencies inherent in hybrid satellites and we have attempted to accommodate hybrid satellites  T-where possible.i# P <ԍ#c PE37MP#` `   The Commission has recognized the advantages of hybrid satellites. See GTE Spacenet Corp.,  zP -9 F.C.C. 1271, 1273 (Comm. Car. Bur. 1994), citing Hughes Communications Galaxy, 6  zP -F.C.C. Rcd. 72 (1991). See also Hughes Communications Galaxy, DA 951736, released  zP^ -August 9, 1995 (denying request to locate the Kuband only SBS6 to a hybrid slot). See also  zP( -Comsat General Corporation, 4 F.C.C. Rcd. 3820 (Com. Car. Bur., 1989) at  8.(#` Ɨ In this processing round we have an adequate number of orbit locations to satisfy  T-all qualified applicants. Granting AT&T's request would permit the most costeffective use of the  T-limited orbit spectrum resource. Under these circumstances, in our May 7 Order, we granted AT&T  Tp-a waiver of Section 25.140(g) of our rules to allow it more than one   expansion Kuband authorization  TH -in this processing round.  H 2# P<ԍ#c PE37MP#` `    We granted similar waivers to GE and HCG in this processing round.(#` AT&T Corp. was found to be legally, technically, and financially  T -qualified to construct, launch, and operate Telstar 5. Accordingly. we granted AT&T's application  T -for the Telstar 5 hybrid satellite. We assigned Telstar 5 to the 93o W.L. orbit location.  S -C. Telstar 7  TX- 11.` ` HCG contended, that granting AT&T's Telstar 7 application would violate our expansion satellite policy. AT&T, however, stated that a strict interpretation of the rule would be  T-contrary to the public interest because such an interpretation would limit its expansion capability and not allow it to compete effectively. It asserted, that this result would be inconsistent with the  T-marketplace since discrete processing rounds create a situation where satellite capacity can only be  T-allocated as a "step function."fU# P<ԍ#c PE37MP#` ` In light of the lengthy construction period required for satellites we have recognized that  xP-licensees need to make traffic projections several years in advance of launching satellites and  xP-that these forecasts will be, to some extent, speculative. Our expansion rule , therefore, strikes a balance between providing licensees some certainty that an additional orbital assignment would be available if traffic growth was realized and preventing other companies' plans from  zP -being blocked by authorizing satellites that ultimately might not be needed. See Licensing  zP!-Space Stations in the Domestic FixedSatellite Service, 50 Fed. Reg. 36071 (September 5, 1985).(#` f  Th-  T@- 12.` ` Section 25.140(g) of our rules says that each qualified applicant may be assigned "no more than one additional orbital location beyond its current authorizations in each frequency band in  T-which it is authorized to operate."y# P'<ԍ#c PE37MP#` ` 47 C.F.R.  25.140(g).(#` y No valid interpretation of this rule would allow AT&T an"0*((" additional expansion C/Kuband satellite, absent a waiver of the rule. AT&T, however, did not  T-present any unique circumstances to justify a waiver. It did not, for example, provide specific documentation of existing and projected traffic requirements or any contracts for capacity on Telstar  T-7. Consequently, in our May 7 Order, we denied AT&T's application for its proposed Telstar 7  T`-satellite. We affirm that decision here.  S- D. Telstar 8 (redesignated Telstar 7)   T- 13.` ` We routinely authorize the construction of ground spares, in part, to permit operators  T-to provide protection in the event of a satellite failure. No objections were raised regarding AT&T's  Tp-qualifications to hold a license for the ground spare, Telstar 8.p# P <ԍ#c PE37MP#` ` Telstar 8 was redesignated Telstar 7 to preserve continuity in numbering of the Telstar 5 series.(#` AT&T is legally, technically, and  TH -financially qualified to construct Telstar 8.H 1# P<ԍ#c PE37MP#` ` See 47 C.F.R.  25.140(b).  See May 7 Order at  10.(#` Ƭ Accordingly, in our May 7 Order, we granted AT&T's application for its Telstar 8 ground spare, which we redesignate Telstar 7.  S - E. Coordination   T -    T - 14.` ` AT&T's satellites are to operate with a maximum EIRP of 37.0 dBW at Cband and 46.5 dBW at Kuband. GE contended that these levels are higher than those routinely used by other satellite operators and that AT&T should, therefore, bear the burden of frequency coordination for  T- these satellites. AT&T stated that its satellites will not create more interference than other Cband  T-satellites already approved and that they will fully comply with our twodegree spacing policy.   T-15.` ` In the May 7 Order, we concluded that there was no longer a need to assign high  Th-power density satellites to specific portions of the arc to facilitate coordination.h# P<ԍ#c PE37MP#` ` See GE American Communications, Inc., 3 F.C.C. Rcd. 687 (1988).(#` ƥ Rather, we found  T@-that newer generation satellites were already operating at these higher powers with no interference  T-problems. Contrary to GE's assertion, AT&T's proposed powers are consistent with those of other  T-authorized satellites . We, therefore, will not require AT&T to bear the entire burden of coordination with licensees in adjacent orbit locations. Rather, we expect, as always, that adjacent licensees will cooperate in reaching coordination agreements that will allow both satellites to operate without  Tx-causing each other harmful interference.7xs# P <ԍ#c PE37MP#` `  See Hughes Communications Galaxy, Inc., 7 F.C.C. Rcd. 4672, 4673 (1992), GTE Spacenet  zPd!-Corporation, 3 F.C.C. Rcd. 6986 (1988), Satellite Transponder Leasing Corporation, F.C.C.  zP."-Rcd. 1651 (1990), and Assignment of Orbital Locations to Space Stations in the Domestic  zP"-FixedSatellite Service, 5 F.C.C. Rcd. 179 (1989).(#`   TP-  S-; Conclusion and Ordering Clauses Đd  T-16.` ` We find that pursuant to Section 309 of the Communications Act, 47 U.S.C  309, "r 0*(( "  T-grant of AT&T's Telstar 5, Telstar 6, and Telstar 8 (redesignated Telstar 7) applications will serve  T-the public interest, convenience, and necessity. This will allow AT&T to provide followon capacity to its existing customers and to expand its system to meet anticipated traffic growth. As specified in  T-the May 7 Order, we have assigned Telstar 5 and 6 to the 93o W.L. and 69o W.L. orbital locations,  T`-respectively.  T-17.` ` Accordingly, IT IS ORDERED that application file Nos. 48DSSLA94, 62SATAMEND95, 63SATP/LA95, 64SATP/LA95, and 65SATP95 ARE GRANTED IN PART and DENIED IN PART, as discussed in this order, and AT&T Corp. IS AUTHORIZED to construct  T-three hybrid C/Kuband fixedsatellites in accordance with the technical specifications set forth in its applications.  T -18.` ` IT IS FURTHER ORDERED that AT&T Corp. IS AUTHORIZED to launch and  T -operate two space stations in the fixedsatellite service in accordance with the  Assignment of Orbital  T -Locations to Space Stations in the Domestic FixedSatellite Service, DA 96713 (May 7, 1996), as well as the relevant terms and conditions of all previous orders and authorizations concerning the  T -operation of space stations. These requirements include the filing of annual reports on the progress of  TX-space station construction, traffic on inorbit satellites and  transponder use. See Streamlining the  T2-Commission's Rules and Regulations for Satellite Application and Licensing Procedures, IB Docket No. 95117 (adopted October 29, 1996).  T-19.` ` IT IS FURTHER ORDERED that unless extended by the Commission for good cause shown, each of the authorizations shall become NULL AND VOID in the event the space station is not constructed, launched, and successfully placed into operation in accordance with the technical parameters, terms, and conditions of the authorizations by the following dates:  T-` `  Construction CommencedConstruction CompletedxxLaunch  T-X` hp x (#%'0*,.8135@8: