Interview | FCC Chairman Pai on RDOF, megaconstellations, debris rules and C-band auction
WASHINGTON — The U.S. Federal Communications Commission’s recent run of space-related regulatory actions has earned the agency both praise and scorn from the space industry.
Streamlined licensing procedures adopted earlier this year promise to make it cheaper for smallsat ventures to launch commercial operations, with at least one U.S. startup crediting the FCC’s regulatory relief for its decision to remain a domestic venture.
However, stricter orbital debris mitigation regulations drafted this spring met with stiff industry resistance, prompting the FCC to defer action on some of the more controversial rules. These included requiring satellite operators to put up satellite-disposal performance bonds and to indemnify the government against damages caused by on-orbit collisions.
The FCC’s upcoming auction of 300 megahertz of satellite C-band spectrum to bandwidth-hungry 5G cellular network operators (combined with political pressure from Capitol Hill) produced a surge of satellite manufacturing and launch deals for U.S. companies. With the auction winners required by the FCC to foot the bill, Intelsat and SES ordered a total of 13 new C-band satellites this summer, 11 of which will be built in the U.S.
On Oct. 29, the FCC is set to start doling out $20 billion in broadband subsidies under the Rural Digital Opportunity Fund (RDOF). While Hughes, Viasat and SpaceX made the list of qualified bidders, they still might not see a dime of RDOF money because the rules put satellite broadband at a disadvantage.
The FCC also caught flak this year for granting Ligado Networks permission to deploy a low-power broadband network that commercial satellite operators, the U.S. Defense Department, Commerce Department and others say could disrupt GPS signals.
FCC Chairman Ajit Pai spoke with SpaceNews in September about these decisions and the agency’s overall approach to regulating space.
What’s the status of the proposed orbital debris regulations?
We’re continuing to study the record, including the input that we got from federal agencies and private sector stakeholders. I’m grateful to all participants in our proceeding for submitting their views on the topic. It’s now been 16 years since the agency looked at those rules. With some of the new innovations in space it’s important to ensure that the orbital debris rules can protect the space environment. What we’re looking to do is to strike a balance, as we do when it comes to terrestrial-based innovation, to encourage innovation in a reasonably safe way.
Were you surprised by the amount of industry and political pushback on the first draft?
No, that’s the exact reason why we have the administrative process. We don’t fiat what the rules are going to be; we put our proposals out there for the express purpose of getting input on what ideas people think are worthwhile and what ideas require further study. I hope that we can reach a resolution that balances those two interests of promoting space-based innovation and encouraging a safe space environment.
When will the FCC try again to move forward with debris mitigation rules?
I don’t have a specific time frame I can share, but I do know our staff has been actively looking at the issue.
How are preparations going for the FCC’s C-band auction?
The preparations are going really well. As you probably know, the eligible [satellite] operators (Intelsat, SES, Eutelsat, Telesat and Claro) have opted into the accelerated relocation payments. We thus far have prevailed in the legal challenges that have been filed by various entities. The FCC staff have been working very hard in putting in place the necessary building blocks for a successful auction.
All systems are go for a Dec. 8 auction, and I’m looking forward to seeing how the auction transpires.
Were you disappointed to see the C-band Alliance fall apart when the FCC announced the accelerated-clearing payments?
What I would say on that topic is that I am pleased the framework we outlined is one that aligned everyone’s interests. The satellite operators you mentioned opted into the accelerated-relocation payment system that we outlined, notwithstanding their disagreements with each other. At the end of the day, they did agree with the FCC framework. Ditto many other entities. While it may not have been their 100% ideal solution, it nonetheless gave them satisfaction that they were better off within the FCC framework than outside of it.
What’s the FCC’s stance on whether the reimbursable satellites should be C-band only?
We did say in the Report and Order that non-C-band-related costs would need to be apportioned out of the reimbursement claims. As a procedural matter, the request for reimbursement will ultimately be reviewed by the clearing house. That is the current state of play.
Were you pleased the majority of the satellite manufacturing and launch contracts went to U.S. companies?
I was pleased. I think it’s great to see that these companies are relying on U.S.-based providers of this equipment. Overall, it speaks to the fact that the U.S. space industry is going further ahead faster than many people might have envisioned just a decade or two decades ago.
There is speculation some companies may try to use the Rural Digital Opportunity Fund to help fund their own low Earth orbit broadband networks. What’s your view?
From my perspective, the critical part of the Rural Digital Opportunity Fund, and any aspect of our Universal Service Fund for High Cost Areas auctions, is the fact that we are technologically neutral. That was an innovation we pioneered my second month in office: to open up these auctions to any company using any technology so long as they were able to meet our service thresholds and the build-out time frames that we specify.
When it comes to RDOF, one of the things we tweaked compared to the Connect America Fund Phase 2 is that we are putting our thumb on the scale in favor of faster speeds and lower latency while still maintaining that principle of technological neutrality. If any company, including the LEO constellation companies, want to compete at a certain service threshold and have demonstrated that they are able to do so, we want them to have a full and fair chance to compete.
I think that the LEO companies have a very interesting use case. I’ve seen parts of the country from above the Arctic Circle to rural areas in the Gulf Coast, and see there may be parts of the country where fiber deployment is infeasible for economic or terrain reasons. There may be other reasons why a space-based competitor might be the best option, so we want to give them a full and fair chance to compete.
Many satellite operators have said they are concerned the FCC’s latency thresholds are so high they don’t have a fair chance to compete.
Our concern is that we’re allocating up to $20.4 billion for future-proofed networks, and as we look at the trajectory of consumer usage, consumers over time are consuming more bandwidth and demanding lower latency in terms of the applications and services they use.
We want to ensure that we are supporting relatively lower latency networks than we did in the past. And especially now in the midst of the pandemic, when you think about some of the connected services that have really proven their worth — telework applications like video calls, telehealth applications like high-bandwidth, low-latency connections between provider and patient, and even some of the non-pandemic-related but relevant services like HD streaming and gaming — these are the types of things people are going to be using broadband for in the future. Latency is an important factor when it comes to how the FCC wants to structure its Universal Service Fund programs. If a LEO satellite operator or any space-based competitor can meet those service thresholds that an increasing number of consumers demand, we want them to have a chance at participating as well.
This is the reason why I was so proud that this has been the first FCC to approve a lot of these non-geosynchronous satellite applications. I’ve long thought that these innovations that we’re seeing in space could really make a big impact in closing the digital divide in many parts of the country. I come to this as someone who is a fan of U.S.-based space innovation when it comes to broadband service delivery. We’re not putting a thumb on the scale against space or for space.
At least one Chinese megaconstellation is widely expected to make it to orbit. If a Chinese operator applies for U.S. market access, would the FCC grant it?
I can’t opine in the abstract about how the FCC might rule in a case like that. Obviously, it would depend on the particular facts that were submitted and the relevant law that we were called upon to apply.
If there were foreign investment questions, there is a new process, the so-called Team Telecom process, that has been recently updated in part because of the [April 4] executive order issued by the president, that might have to be applied. But generally speaking, we have had some concerns about equipment and services that come from companies that are subject to Chinese jurisdiction, and I’m not sure how if at all any such application of the type you’re describing would play into that, but that’s been an ongoing concern.
The FCC has been asked to repeal or reconsider its Ligado ruling. What’s going to happen?
We haven’t made a decision yet on the petition for reconsideration we received [from the Commerce Department]. But what I will say is what I’ve said publicly, including to members of Congress, which is that I’m very proud of the decision that we made. Ligado first got ancillary terrestrial authority in 2003. The FCC first opened the door to what the technical rules should be in 2010-2011; we’re now in 2020, and the time had come for someone in my position not to kick the can down the road any longer.
We didn’t proceed by putting our finger to the wind. We put our finger on some of the problems that were identified during the interagency radio advisory committee process, gave the federal agencies extra time — gave them an actual draft of the order about six months before we made the decision — and took feedback from a wide variety of stakeholders outside of government. If you look at our 72-page decision, it’s very carefully calibrated. We didn’t rubber-stamp Ligado’s application by any means. We approved it with significant conditions, including a 99% reduction in power levels to 9.8 decibel watts, and required a 23-megahertz guard band carved out of Ligado’s own spectrum to protect adjacent operations, GPS in particular, from any potential harmful interference.
There was an extensive coordination process with federal agencies and Ligado, and other steps too to ensure that this issue could be resolved in a way that accommodated both interests, allowing Ligado to move forward and protecting GPS from harmful interference.
At the end of the day, I think this exemplifies the FCC’s focus on sound engineering. I stand by it 100%, and I’m glad that this was an area where the agency spoke with a unanimous voice. Republican and Democratic commissioners alike ratified the decision by the FCC’s Office of Engineering and Technology, among others, to approve this application with conditions.
There’s been a lot of commentary about this issue, but nonetheless at the end of the day — in this area as in other areas where we have made difficult but necessary spectrum decisions — this decision will stand the test of time.
The Ligado decision appeared to cost Republican commissioner Michael O’Rielly his job. Do you think the political response to the FCC’s decision is being handled poorly?
I can’t comment on any of that. All I can say is we focused solely on the facts in this proceeding and so long as I have any say in the matter we’ll continue to focus on the facts.
When will the FCC decide on the Commerce Department’s petition to reconsider Ligado?
I can’t give you any particular time frame. I know this is an issue that the staff is looking at.
This article originally appeared in the Oct. 19, 2020 issue of SpaceNews magazine.