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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) COMSAT CORPORATION ) ) For Authority under Section 214 of the) ITC-98-089 Communications Act of 1934, as amended,) to provide Inmarsat-D+ service in the ) United States ) ) ORDER Adopted: August 10, 1998 Released: August 11, 1998 By the Chief, International Bureau: I. INTRODUCTION 1. By this Order, we deny, without prejudice, COMSAT's petition to provide Inmarsat-D+ service in the United States. We will reconsider this decision at such time as COMSAT agrees to waive any privileges and immunities it may have with respect to provision of this service as a result of its status as a signatory to Inmarsat. II. BACKGROUND 2. On January 22, 1998, COMSAT Corporation ("COMSAT") applied for authority under Section 214 of the Communications Act of 1934, as amended, (the "Act") to provide Inmarsat-D+ service ("D+ Service") in the United States via the Inmarsat satellite system using its earth stations at Southbury, Connecticut and Santa Paula, California. COMSAT is currently authorized to provide Inmarsat-A, -B, - C, -M and mini-M mobile satellite services in the Atlantic, Pacific and Indian Ocean Regions to maritime users, to international land mobile users outside of North America and to aeronautical users. D+ Service will provide two-way satellite paging and tracking services, using mobile terminals, for long distance trucking. COMSAT argues that provision of D+ Service will fill a "void" because no other system exists that has the same capabilities. As a result, COMSAT urges the Commission to waive its outstanding policy with regard to the provision of domestic service by COMSAT and authorize D+ Service. 3. We put COMSAT's application on public notice. Iridium, LLC ("Iridium"), AMSC Subsidiary Corporation ("AMSC"), Orbital Communications Corporation ("ORBCOMM"), QUALCOMM Incorporated ("QUALCOMM") and Motorola, Inc. ("Motorola") filed petitions to deny. COMSAT filed an opposition to these petitions and ORBCOMM, AMSC, QUALCOMM and Iridium filed reply comments. III. DISCUSSION 4. The Commission's recent International Satellite Services Order adopted a framework under which the Commission will consider requests for access by non-U.S. licensed satellites to provide service to, from or within the United States. That Order established a rebuttable presumption that services via satellites licensed by members of the World Trade Organization would promote competition in the U.S. satellite services market. At the same time, the Commission specifically declined to adopt the same standard for service via satellites operated by the inter-governmental satellite organizations (IGOs), INTELSAT and Inmarsat. The Commission determined that the IGOs have unique characteristics as treaty-based organizations that could enable them to distort competition in the U.S. market. Among these characteristics is the immunity INTELSAT and Inmarsat enjoy from suit, including suit under the U.S. antitrust laws. 5. The Commission noted that COMSAT, in its role as the U.S. Signatory to INTELSAT and Inmarsat, also benefits from these immunities. It concluded that this extension of immunity provides COMSAT a competitive advantage, a situation that the Commission was not willing to extend to the U.S. domestic satellite market. Therefore, the Commission determined that COMSAT must include an appropriate waiver of immunity from any suit as part of its application to provide domestic services via INTELSAT or Inmarsat. It went on to say that even if COMSAT includes an appropriate waiver, it would also have to show that entry into the U. S. domestic market by an INTELSAT or Inmarsat satellite would promote competition and is otherwise in the public interest. 6. Since the International Satellite Services Order was adopted, the Commission has reiterated its concern about the anticompetitive effect of COMSAT's privileges and immunities in respect to its commercial activities. In January 1998, the Commission denied COMSAT temporary authority to provide domestic service in the United States through Inmarsat's PLANET 1 service but gave COMSAT an opportunity to refile in order to show that it has complied with the waiver requirements of the International Satellite Services Order. In the COMSAT Non-Dominant Order, the Commission decided to maintain COMSAT's status as a dominant common carrier in part because the immunity enjoyed by COMSAT is a clear advantage over competitors that do not enjoy similar protection. 7. Notwithstanding the Commission's policy regarding domestic service, in this application COMSAT has not agreed to waive its privileges and immunities. Instead, COMSAT argues that D+ Service can provide capabilities and cost efficiencies not available from any other provider. This special circumstance, according to COMSAT, warrants a deviation from the policy established in the International Satellite Services Order. COMSAT asks the Commission to grant the application notwithstanding COMSAT's failure to waive its privileges and immunities. 8. We need not address the question of under what circumstances the Commission deviates from an established policy, because we reject COMSAT's argument that it is providing a service that "fills a void" in the market. Petitioners have demonstrated that several competitors already provide, or will soon provide, the same service that COMSAT proposes to offer. For example, ORBCOMM notes that its Non-Voice, Non-Geostationary Mobile Satellite Service (NVNGMSS) is operational and providing two- way messaging and tracking services through the Magellan GSC 100 subscriber system. ORBCOMM further notes that five other manufacturers are offering or will shortly offer subscriber communications that work with its satellite. Similarly, QUALCOMM states that it owns and operates the OmniTRACS system, a two-way mobile satellite messaging and position tracking system that provides the same service as D+ Service. 9. While COMSAT admits that the OmniTRACS system possesses all the capabilities of D+ Service, it argues that OmniTRACS is not part of the same market because it provides excess capabilities and costs more than D+ Service. We disagree that price differences or scope of service are relevant to determining whether the service is available to consumers. Price differences and better service could be relevant to our determination of whether COMSAT's entry into the U.S. domestic market by an INTELSAT or Inmarsat satellite would promote competition and is otherwise in the public interest. But we do not reach that second prong of our analysis for COMSAT under the International Satellite Services Order because of COMSAT's failure to waive the relevant privileges and immunities. 10. Because we are denying COMSAT's petition, we need not address the questions raised by commenters of whether COMSAT has authority to provide D+ service domestically or whether its application omits necessary information. We also need not address AMSC's argument that grant of COMSAT's request would adversely affect AMSC's access to sufficient spectrum. IV. CONCLUSION 11. In light of COMSAT's failure to waive its privieges and immunities prior to provision of domestic U.S. service via Inmarsat, we deny COMSAT's petition to provide domestic Inmarsat-D+ Service. We will consider whether COMSAT's provision of Inmarsat-D+ service promotes competition in the United States and is in the public interest if COMSAT files an appropriate waiver. V. ORDERING CLAUSES 12. Accordingly, IT IS ORDERED that the application of COMSAT Corporation to provide domestic Inmarsat-D+ service (File No. ITC-98-089) IS DENIED. 10. This Order is issued under Section 0.261 of the Commission's Rules and is effective upon adoption. Petitions for reconsideration under Section 1.106 or applications for review under Section 1.115 of the Commission's Rules may be filed within 30 days of the date of public notice of this Order (see Section 1.4(b)(2)). FEDERAL COMMUNICATIONS COMMISSION Regina M. Keeney Chief, International Bureau