Kennedy Wants More Hill C-Band Scrutiny, Citing FCC-Intelsat Meeting
A Tuesday Senate Appropriations Financial Services Subcommittee hearing on the FCC’s spectrum auctions program was a venue for subcommittee Chairman John Kennedy, R-La., to again dig into his longstanding concerns about the plan for 3.7-4.2 GHz C band, as expected (see 2005270034). Kennedy and other subpanel members discussed the issue throughout three rounds of questions for FCC Chairman Ajit Pai. Kennedy forecasted another hearing soon. Pai and some subcommittee members highlighted the need for additional telecom funding as part of COVID-19 aid (see 2006160049).
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“I don’t think [the Senate] is done with” the C-band issue in a legislative or oversight sense, Kennedy told us. He’s the lead Republican sponsor of the Spectrum Management and Reallocation for Taxpayers Act (S-3246) and eyed attaching a rider to the subcommittee’s FY 2021 FCC appropriations bill to allocate auction money (see 2002130053). S-3246 would set aside all but $11 billion of C-band sale proceeds for telecom projects (see 2001280063).
Financial Services ranking member Chris Coons, D-Del., said he wants to work with Kennedy to ensure “some of these auction proceeds go to expand broadband.” Sen. Chris Van Hollen, D-Md., noted his Homework Gap Trust Fund Act (S-3362), which would direct up to $4 billion of C-band proceeds to a Treasury-hosted fund to pay for students’ at-home broadband access and hot spots (see 2002280044).
Kennedy again noted his ire over the FCC’s decision to offer $9.7 billion in incentive payments to satellite incumbents that migrate elsewhere, saying he believes it didn’t stave off litigation in the U.S. Court of Appeals for the D.C. Circuit (see 2005050047). It wouldn’t prevent major incumbents that agreed to participate in C-band clearing from suing, he said: "I’ve never heard of giving somebody $10 billion dollars to keep them from suing without them waiving their claims and causes of action." Kennedy aims to have FCC staff testify about the C-band lawsuit landscape at the coming hearing.
Pai contended he believes a suit by participating satellite companies isn’t an "eventuality" the FCC is likely "going to face.” Current challengers -- satellite truck operator PSSI Global Services and small satellite operators ABS Global, Empresa and Hispasat -- won’t prevail at the D.C. Circuit, he said. Pai noted the auction could be delayed two-four years without the incentive payments. That would make it “more likely” other countries could lure away related “talent and capital,” he said.
The future hearing would also delve into details of a Nov. 5 meeting between Intelsat CEO Stephen Spengler and a senior FCC lawyer on the C-band proceeding, Kennedy said. That meeting came just before major Intelsat investors BC Partners and Silver Lake Group sold $246 million of stock, Kennedy said. Rosen Lawn is suing BC and Silver Lake in U.S. District Court in Oakland on insider trading allegations (see 2004080064). Kennedy said he’s concerned about the juxtaposition between the FCC meeting and the Intelsat stock sale, though “maybe it is just a coincidence.” Kennedy noted Intelsat’s bankruptcy (see 2005140028).
Intelsat sought information from the FCC at the Nov. 5 meeting on the direction the commission was heading on its C-band auction plans, but staff “declined to state a position one way or the other,” Pai said. “They did not give any forecast as to where” the commission was heading and the staff involved in the meeting is still serving “with great distinction.” Intelsat, BC and Silver Lake didn’t comment.
Commerce Committee Chairman Roger Wicker, R-Miss., and Communications Subcommittee Chairman John Thune, R-S.D., urge Pai to “move swiftly” to clear the band to meet the “planned auction timeline” and Dec. 8 start date. “The FCC’s sound and decisive approach to free up 280 megahertz of C-Band spectrum for flexible use will help deliver 5G services to all Americans,” the senators wrote Pai Monday. Phoenix Center Chief Economist George Ford urged Congress Tuesday to understand that “any delay” of the “carefully crafted auction timetable will do more harm than good.”