PEGASUS WANTS FCC TO SPEED 2ND ROUND KA-BAND ALLOCATIONS
Making 2nd round Ka-band spectrum allocations hasn’t been high priority at FCC, but U.S. eventually may lose valuable spectrum slots at ITU “if nothing is done,” Pegasus Communications CEO Mark Pagon said in interview: “A lot of other things seem to be more important [to Commission officials]. For some reason, they act like they don’t want to deal with this, but this is a very critical issue.” Pagon said new leadership at FCC was in position to change bureaucratic structure and begin to move policies through faster. In meeting last week with 2nd round Ka- band applicants, Commission said it would resolve outstanding licensing issues by end of summer, according to industry source who attended one-hour session hosted by FCC International Bureau (CD July 31 p1).
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Pagon said it was extremely important for upstart companies to win spectrum licenses to offer broadband services, but those efforts often are hurt by slow licensing process and political nature of Commission structure. “A lot of companies are holding on to licenses they don’t intend to use” as way to deter competition, Pagon said. “New companies that want to do something can’t shake the licenses loose. As a new business, these policies make it very difficult for you to get off the ground.”
In past, FCC “inaction” and “difficulties in overcoming established relationships” involving existing companies and Commission officials often have deterred efforts of new companies such as Pegasus to get licenses and spectrum, Pagon said. Incumbents “seem to get preferential treatment,” he said, pointing to companies such as Hughes, which has 16-20 Ka-band licenses while others such as Pegasus and Cellsat are struggling to get first license approved. Pegasus has been waiting 40 months for FCC to approve license application. “The older companies have inherent advantages,” Pagon said: “You have to remember that many of these companies have been doing business with the same FCC officials for a long period of time and they have developed strong relationships. It makes it tough for a new company.”
Pagon said that could really come back to haunt U.S., which “faces danger” of losing valuable spectrum that might otherwise be used for important Ka-band services. “They are going to have to move real fast” to beat the deadline of spring 2005. In Feb., FCC issued order modifying licenses of 10 companies to provide Ka-band services with intersatellite links (CD Feb 1 p2). “We're not crying over spilled milk, but the FCC basically gave those companies a free pass for 4 years,” said industry official close to Pegasus. Another said “it’s clear” that companies with licenses “aren’t going to build all of these satellites and that’s a great part of the frustration for companies like Pegasus.”
Pegasus officials cited March 14 letter from Motorola to FCC asking that its Ka-band license be transferred to Teledesic, which wasn’t among first- or 2nd-round applicants. It’s perfect example, they said, of how some licenses are “abandoned and picked up by line jumpers.” Motorola was one of 10 companies that received modified license with ISLs in Feb. “That’s a license that can be used by another company,” Pagon said.