[Congressional Record Volume 145, Number 20 (Thursday, February 4, 1999)]
[Senate]
[Pages S1275-S1276]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BURNS (for himself, Mr. McCain, Mr. Dorgan, Mr. Bryan, Mr. 
        Brownback, and Mr. Cleland):
  S. 376. A bill to amend the Communications Satellite Act of 1962 to 
promote competition and privatization in satellite communications, and 
for other purposes; to the Committee on Commerce, Science, and 
Transportation.


    OPEN-MARKET REORGANIZATION FOR THE BETTERMENT OF INTERNATIONAL 
                     TELECOMMUNICATIONS (ORBIT) ACT

 Mr. BURNS. Mr. President, I rise today to introduce the 
``Open-market Reorganization for the Betterment of International 
Telecommunications (ORBIT)'' bill, an important piece of

[[Page S1276]]

legislation that will modernize our nation's laws and policies 
regarding the provision of international satellite communications 
services. I also thank the help and hard work of my colleagues who are 
original cosponsors of this bill, including the Chairman of the 
Commerce Committee, Senator McCain, and Senator Brownback, Senator 
Bryan, Senator Dorgan and Senator Cleland.
  Dramatic technological and marketplace changes have reshaped global 
satellite communications in the thirty-six years since enactment of the 
Communications Satellite Act of 1962. These changes necessitate that we 
update our nation's satellite laws to establish a new policy framework 
for vibrant international satellite communications in the 21st century.
  The bill I introduce today reflects a reasoned and balanced approach 
that will enable more private companies, as opposed to government 
entities, to bring advanced satellite communications service to every 
corner of the globe--including poor, remote and lesser developed 
countries. This bill puts the full weight of the United States squarely 
behind the privatization of INTELSAT, an intergovernmental organization 
embracing 142 countries, which, in turn, will transform the 
international satellite communications marketplace into a more robust 
and genuinely competitive arena. The beneficiaries of this legislation 
will be American companies and their workers who will have new 
opportunities to offer satellite communications services worldwide and 
consumers who will be able to enjoy a choice among multiple service 
providers of ever more advanced communications services at lower cost.
  When the Soviet Union launched Sputnik in 1957, the United States 
responded immediately and aggressively to recapture the lead in the 
advancement of satellite technology. Our nation understood the 
tremendous potential of satellite technology, but at the same time 
recognized that because of the cost, risk and uncertainty, no 
individual company would develop it alone. Therefore, the U.S. enacted 
the Communications Satellite Act of 1962 which created COMSAT, a 
private company, to develop by itself, or presumably with the 
assistance of other foreign entities, a commercial worldwide satellite 
communications system. Subsequently, the international treaty 
organization, INTELSAT, was created to provide mainly telephone and 
data services around the world. COMSAT and INTELSAT have worked 
together over the last three decades to introduce satellite 
communications services here and abroad.
  The INTELSAT/COMSAT experiment has been a magnificent success. 
INTELSAT, has grown to include 142 member countries, utilizing a 
network of 24 satellites that offer voice, data and video services 
around the world. In the last fifteen years, technological advances, 
improved large-scale financing options, and enriched market conditions 
have created a favorable climate for new companies to provide services 
that only INTELSAT had previously been able to offer. However, while 
the success of INTELSAT has spurred multiple private commercial 
companies to penetrate the global satellite market, these private 
companies have expressed serious concern about the existence of 
INTELSAT, in its present form, and the unlevel playing field upon which 
they must compete with INTELSAT. My legislation addresses their 
concerns.
  This legislation prods INTELSAT to transform itself from a multi-
governmentally owned and controlled monopoly to a fully privatized 
company. The legislation articulates the new United States policy that 
INTELSAT must privatize as soon as possible, but no later than January 
1, 2002 and it creates a process to encourage and verify that this 
privatization effort occurs in a pro-competitive manner.
  This legislation puts clear and specific restrictions on INTELSAT's 
ability to expand its service offerings into new areas, such as direct 
broadcast satellite services and Ka-band communications, pending 
privatization. At the same time, it preserves INTELSAT's ability to 
provide its customers services they currently enjoy. INTELSAT customers 
are not artificially denied services to which they already have access.
  INTELSAT also is offered incentives to privatize. One of INTELSAT's 
most important business objectives is to obtain direct access to the 
lucrative U.S. domestic market. My legislation does not hand this over 
to INTELSAT and the other 141 member countries without commercial 
reform. Rather, it withholds this desired benefit until privatization 
is complete. I should add that with the introduction of this 
legislation, I call on the FCC to halt its pending rulemaking to allow 
Intelsat to directly access the U.S. market before privatization. This 
rulemaking undermines a central tenet of this bill, and would exceed 
the agency's authority in any event. I urge the FCC to let Congress 
resolve this issue through the legislative process.
  This legislation provides the President of the United States with the 
authority to certify that INTELSAT has privatized in a sufficiently 
pro-competitive manner that it will not harm competition in the U.S. 
satellite marketplace. The President is required to consider a whole 
array of criteria such as the owner structure of INTELSAT, its 
independence from the intergovernmental organization, and its 
relinquishment of privileges and immunities. These criteria will ensure 
that INTELSAT is transformed into a commercially competitive company 
without any unfair advantages. If the privatization does not occur 
within the time frame provided in my legislation, January 1, 2002, the 
President is required to withdraw the U.S. from INTELSAT.
  I believe that the House and the Senate, working constructively 
together, can enact international satellite competition legislation 
this year. In particular, I want to commend the Chairman of the House 
Commerce Committee, Representative Bliley, for all the good work he did 
last Congress in passing H.R. 1872 through the House. I am confident 
that our shared objectives will enable us to resolve differences on a 
number of specific issues and obtain the broad, bipartisan support 
needed to move this legislation quickly. I especially look forward to 
working with my colleagues on both sides of the aisle in the Senate to 
reaching swift agreement on this bill which will enhance America's 
competitive position as we enter the 21st century.
                                 ______