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Separate Statement of Commissioner Harold W. Furchtgott-Roth

In the Matter of Direct Access to the INTELSAT System (IB Docket No. 89-182, File No. 60-SAT-ISP-97)

Today's decision by the Commission to permit Level 3 direct access to the INTELSAT system is, in virtually all aspects, a sound conclusion that will inure to the benefit of U.S. carriers and consumers. I write separately to note that I would have gone further than the Commission has gone in one particular respect. As a part of today's order, the Commission restricts direct access for a certain class of carriers, namely, carriers (other than Comsat) who are INTELSAT signatories. Such signatories are prohibited from utilizing direct access for service to any foreign country in which that signatory uses 50 percent or more of all INTELSAT capacity used in that particular country.

This restriction is founded, as the argument goes, on concerns that signatories have potential incentives to act anticompetitively in the setting of the INTELSAT utilization charge (IUC) for direct access. Artificially low IUCs would be in these signatories' economic interest as purchasers of direct access in the U.S. On the other hand, low IUCs would be injurious to Comsat, which as a "carrier's carrier" relies heavily on revenues from access to INTELSAT (as opposed to access being simply a component of the retail price charged for an end product, as is the case for most foreign signatories).

As an economic matter, I find this argument to be at a minimum debatable. Further, I have concerns about our ability to police compliance with the restriction. I support today's decision, however, because it is a further step in opening U.S. markets to the global satellite marketplace (and a step, I might add, that goes above and beyond our commitments under the WTO Basic Telecom Agreement). Simply put, I would have preferred to go even further than we have done today in championing open markets by not adopting this restriction.