SLIDE 1 Thank You, Dale. Good morning Mr. Chairman, Commissioners. I would like to do three things today. First, I would like to address briefly assignment methods used for satellite services. Second, I would like to show a short series of videos to illustrate different types of satellite constellations. Finally, I would like to address the tensions that affect many spectrum decisions. SLIDE 2 Let me turn first to assignment methods. We have conducted successful auctions in two different satellite services, Direct Broadcast Satellite Service (DBS) and Digital Audio Radio Service (DARS). Both services involved spectrum that could be uniquely identified as “U.S.” spectrum by the ITU Radio Regulations. In other satellite services, we have taken a different approach in light of international concerns. As the Commission has recognized, auctions for international global satellite systems may present unique problems such as sequential auctions. Satellite authorizations are typically issued as a result of processing rounds in which applications for particular frequency bands are considered simultaneously. We undertake substantial efforts through engineering solutions, etc., to resolve any potential mutual exclusivity among these systems. Once licensed, each licensee is given a fixed amount of time in which to construct, launch, and operate the system. Let’s go to the video. In the first video, you will see represented a geostationary Fixed Satellite Service as viewed from above the orbit. Geostationary means that the satellite remains fixed relative to the earth, approximately 35,000 kilometers above the equator. Fixed Satellite Service means that the location of the earth station is fixed on the earth. In this video, you can see the earth stations in the four corners of the contiguous U.S. The satellites are separated by 5o of longitude. It is also possible to have the earth stations or, in this case, handsets or mobile terminals, move in the geostationary system either along the earth, or in the case of aircraft, through the air. Until recently, domestic U.S. commercial providers exclusively used this type of satellite system. Let’s go to the next video. In the second video, we see a non-geostationary Fixed Satellite Service constellation. The earth station is again fixed on the earth, but, as you can see, the satellites are no longer stationary with respect to the earth. The altitude of this particular constellation is about 1500 kilometers or 6% as high as the geostationary altitude in the previous video. In the third video, the satellites are again in motion, illustrating the sweeping movement of the beams along the surface of the earth and across national boundaries. We also show the satellites communicating with fixed and mobile earth stations. In this video, you can see the communication links from the mobile terminals to the fixed stations through the satellites. Let’s go to the next video. While the first three videos illustrated various components of the current spectrum management situation, this last puts them together, adding in the complexity of sharing between geostationary and non- geostationary constellations. We see the beams from the geostationary constellation with fixed stations and beams from the non-geostationary one with fixed and mobile stations. I will leave this video up through the rest of my presentation as I discuss the various layers of tensions. Bearing in mind this complexity, I would like to turn next to the tensions that affect our spectrum management decisions. As we turn to the tensions, I wish to emphasize a goal: to act as quickly as possible to get spectrum in the hands of users to allow market forces to decide what business models survive and to allow innovation to thrive. The first layer of tension is international spectrum policy vs. domestic spectrum policy. While there is some commonality of use from nation to nation, there are often substantial differences. Even where service allocations are compatible across national borders, there can be conflicts due to competing national assignment requirements. As a result, our ability to meet domestic policy goals may be constrained. Further, because of the World Trade Organization treaty and other market opening initiatives (such as some of the protocols we entered into), it is no longer possible to make spectrum decisions solely based on domestic factors. These international agreements have increased the tension involved in providing spectrum to satisfy foreign-licensed satellite requests to access the US market. The second layer of tension is government and non- government use of spectrum. Goals of government and non-government frequency users will not always be the same. A non-government users objective to have maximum spectrum flexibility to meet changing market demands may not coincide with a government users objective to protect national security or safety of life. These sometimes-conflicting objectives make coordination between the two groups difficult, both for domestic decisions and when developing US positions for international conferences. Bill Hatch from NTIA will discuss this further. The third layer of tensions is the allocation layer. Here the questions are focused on how to allocate terrestrial wireless and broadcast and satellite services. Whether spectrum should be allocated on an exclusive basis or a shared basis? If shared spectrum, who should bear the burden of sharing? How to promote innovation? Should incumbency have its privileges or should the nod be given to new participants? These are also issues in the international arena. World Radio Conferences are held every two to three years to discuss allocations and procedures for coordination, sharing methods and criteria, etc., to respond to new requirements for spectrum. The fourth layer of tension is the assignment layer. Here the basic questions are who should get frequency assignments, and what should be the conditions of licensing. Are there constraints that should be adopted, for example, to facilitate sharing? Or, to put it differently, who should bear the burden of sharing? Internationally, satellite and terrestrial coordination and notifications are used to protect existing services and are also a critical component of these assignment decisions. In conclusion, with the progressive market opening decisions of the recent past, including the WTO and the protocols, the days of making spectrum decisions mainly based on domestic considerations are over. We are committed to timely action in making spectrum management decisions. Our spectrum management task must evolve to reflect the new requirements of a more open global economy. Thank you very much.