TR Daily FCC Eliminates Domestic Coverage Requirement for NGSO FSS Systems
Friday, August 28, 2020

FCC Eliminates Domestic Coverage Requirement for NGSO FSS Systems

The FCC released an order today eliminating the domestic coverage requirement for non-geostationary-satellite-orbit, fixed-satellite service (NGSO FSS) systems.

“This requirement is no longer needed to ensure all Americans have access to the benefits of NGSO FSS systems,” the Commission said in a second report and order adopted in IB docket 16-408. “With advances in NGSO technology and spectrum sharing, the domestic coverage requirement can actually discourage or hinder the development of new innovative NGSO FSS systems like the Arctic Broadband Satellite Mission and Kepler, that propose to provide valuable connectivity to Alaska and the arctic areas, as well as the Audacy Network’s space-based relay platforms, or Kuiper’s and ViaSat’s proposed broadband systems.

“These systems would not meet the Commission’s current coverage requirement, yet propose to provide valuable satellite-based services in the United States and around the world,” the agency added. “This action will provide greater regulatory certainty, and design and operational flexibility to innovative NGSO FSS systems while still meeting the Commission’s goal of promoting widespread NGSO service offerings.”

The order follows up on a further notice of proposed rulemaking adopted in 2017 (TR Daily, Sept. 26, 2017).

“Since the Commission adopted its NGSO FSS domestic coverage requirements in 1997 and 2002, a number of NGSO FSS systems have been proposed that were not ‘inherently global in nature.’ These systems have been designed to meet the requirements of certain underserved areas, where satellite services in general are especially valuable, such as in Alaska or on islands and ships in the Pacific Ocean,” the FCC elaborated in its order. “In addition, not all NGSO FSS systems may provide general consumer or enterprise broadband services. Instead, they may focus on a narrower set of services for which there is no significant nationwide demand or rationale for imposing nationwide coverage for these services. Furthermore, the Commission has developed new, more efficient sharing criteria among NGSO FSS systems to encourage multiple systems to operate in different areas of the United States simultaneously. These spectrum sharing possibilities among NGSO FSS systems also allow both broad coverage and specialized coverage systems to coexist. Accordingly, one NGSO FSS system with only partial coverage of the United States does not preclude another NGSO FSS system from covering the remainder of the United States or from providing full U.S. coverage. Indeed, allowing targeted or regional coverage may promote more intense and efficient use of this spectrum by enabling geographic sharing in addition to other forms of sharing already in use.”

The order continued, “Cumulatively, NGSO FSS systems that have already been approved by the Commission will provide complete coverage of the United States, and the long reach of satellite technology, with the particular advantages of lower-latency associated with NGSO FSS systems, provide inherent incentives for future NGSO FSS systems to likewise provide coverage across the United States, especially the underserved areas. For example, the domestic coverage requirements were waived for the first, currently operating NGSO FSS system, but this system was later expanded to provide full coverage of the United States not because of a regulatory imposition but growing business rationales. We are therefore not persuaded by parties claiming that elimination of the domestic coverage requirement would weaken incentives for NGSO FSS operators to provide service in rural and remote areas, notably in Alaska.

“For similar reasons, we disagree with commenters who argue that, absent the domestic coverage requirement, NGSO FSS operators will concentrate on high-population areas to the exclusion of rural and remote areas,” the order added. “NGSO FSS satellite technology is relatively efficient at serving rural and remote areas when compared with alternative, terrestrial services. NGSO FSS operators have more of an incentive to serve areas which terrestrial providers find it more costly to serve, and less of an incentive to serve high-population areas which already have multiple terrestrial suppliers that would be more challenging to compete against.”

“Given these incentives and the coverage provided by already-approved NGSO FSS systems, we also do not agree that, in eliminating this requirement, we should require NGSO FSS system applicants that will not serve the entire United States to demonstrate in their application that they will provide substantial service to the rural areas within their coverage area,” the FCC said. “Like with the domestic coverage requirement itself, without this requirement, we believe that systems already in operation or proposed will continue to provide coverage of all of the United States because of the technical and financial advantages that NGSO FSS satellite systems have in providing services to sparsely populated areas when compared with terrestrial alternatives that are relatively more costly to deploy in these areas, as discussed above. And providing greater flexibility to NGSO FSS system designers will allow greater deployment and more cost-effective solutions for consumers, including in rural areas.”

The FCC also said it disagreed “with one comment that the domestic coverage requirement is mandated by section 1 of the Communications Act of 1934, as amended (the ‘Act’). The Commission has authorized a large variety of GSO satellite networks and terrestrial wireless systems without ever interpreting the Act to require that a single wireless applicant cover the entire United States. Nor did the Commission so interpret the Act when adopting the particular NGSO FSS coverage requirements at issue here. … We also reject the approach of considering waivers on a case-by-case basis, as suggested by some commenters, as this would create regulatory uncertainty for NGSO FSS system proponents while they design systems that will ultimately seek a waiver. Even greater regulatory uncertainty, and higher costs of deployment, would result from Commission efforts to force the re-engineering of a satellite constellation until it complied with the domestic coverage requirement.”

“We will apply the rules and procedures we adopt in this Report and Order to pending space station applications and petitions for U.S. market access,” the FCC said. “The Commission may apply new procedures to pending applications if doing so does not impair the rights an applicant possessed when it filed its application, increase an applicant’s liability for past conduct, or impose new duties on applicants with respect to transactions already completed. Applicants do not gain any vested right merely by filing an application, and the simple act of filing an application is not considered a ‘transaction already completed’ for purposes of this analysis. Accordingly, applying our new rules and procedures to pending space station applications will not impair the rights any applicant had at the time it filed its application. Nor will doing so increase an applicant’s liability for past conduct.”

In a separate statement, Commissioner Jessica Rosenworcel said, “For years this rule has required satellite systems to be capable of providing service to all parts of the United States. That’s important because no matter who you are or where you live in this country you need access to modern communications to have a fair shot at 21st century success. But satellite systems have evolved and improved in many ways, and the evidence now suggests that this rule may be doing more harm than good. By eliminating the nationwide coverage requirement, the Federal Communications Commission creates possibilities for new NGSO systems that are designed specifically to serve the underserved areas that our rule was intended to protect—even if there is not nationwide demand for that service. That means more competition, more service, and more innovation for more Americans.

“So while we are disposing of our nationwide coverage requirement today, it is not because we no longer think ubiquitous, nationwide coverage is important,” she added. “Just the opposite. Our action is intended to promote more service, not less. And it is intended to promote service in rural and remote areas, including Alaska and Hawaii. If for any reason we find that parts of the country are being left behind, I expect the agency to take action to fulfill its core statutory mandate: to make available advanced communications service to all Americans.”

John Janka, Viasat, Inc.’s chief officer-global government affairs & regulatory, welcomed the order released today. “We applaud the Commission’s elimination of unnecessary regulation and its facilitation of new and innovative solutions to extend fast, affordable and reliable satellite broadband to the underserved and unserved,” he said. —Paul Kirby, [email protected]

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