Anticompetitive Claims Not Appropriate for Orbit Act, Says Intelsat

Recent claims from Artel, Globecomm Systems, CapRock and Spacenet that Intelsat engages in anticompetitive behavior were filed in the wrong FCC proceeding and should be dismissed, Intelsat said. Intelsat’s comments to the FCC responded to those filed there as part of the Open-Market Reorganization for the Betterment of International Telecommunications (ORBIT) Act, which requires the agency to provide annual reports to the House and Senate Commerce and Foreign Relations committees on the effect of the privatization of Intelsat and Inmarsat. CapRock, Artel, Globecomm and Spacenet complained Intelsat was using its size and access to its satellites to win contracts while stunting competition (CD April 12 p6). The FCC ORBIT Act report is due to Congress by June 15.

The filings from CapRock, Artel and Globecomm stem from their failed bid on a U.S. Navy Commercial Broadband Satellite Program contract that Intelsat subsidiary Intelsat General won, said the parent company. The critics are using the proceeding “as a forum to hobble Intelsat as a privatized competitor,” it said. “Even apart from the absence of merit in their positions, the commentors’ views are extraneous to this proceeding and should not be injected into the Commission’s report under the ORBIT Act.” The proceeding is meant to “confirm that Intelsat now operates in the satellite marketplace as a fully privatized company” and without the preferential treatment given to an intergovernmental organization rather than a place to discuss problems with competition, said Intelsat.

The critics also mistakenly believe the public services agreement between the International Telecommunications Satellite Organization and Intelsat allows the FCC to regulate Intelsat’s pricing. That agreement is a private contract and the commission has said it doesn’t get involved in private contractual matters, said Intelsat. While the companies say the industry isn’t competitive, the companies don’t ask for companies other than Intelsat to be further regulated and industry competition complaints should be filed in the FCC’s annual report on satellite industry competition, instead of the ORBIT Act proceeding, the company said.

Meanwhile, Artel and Globecomm were given until April 28 to file surreplies in response to Intelsat’s reply comments. The International Bureau granted the request Thursday because “the public interest would be best served by providing an opportunity to respond” and it will “result in a more complete discussion of the issues,” said the bureau. The companies declined to comment.