Satellite communications for the European consumer are set to take off as business concerns are being given a chance to operate the sky-ways. An inkling of the extent of the public’s deprivation in the past and more important, the size of the market yet to be tapped the is illustrated by the ferocity of the […]
Satellite communications for the European consumer are set to take off as business concerns are being given a chance to operate the sky-ways. An inkling of the extent of the public’s deprivation in the past and more important, the size of the market yet to be tapped the is illustrated by the ferocity of the battle between media barons Robert Maxwell and Rupert Murdoch. While satellite remained purely in the hands of the public operators, there was little incentive to develop the range of services for the user as income from voice and data traffic was guaranteed from other means of terrestial transmission. As other players are allowed into the market, however, satellite will extend from standard telephony, television and data broadcast into areas such as back-up for vulnerable undersea cables and mobile communications. PanAmSat Debates on the extent to which the provision of satellite links should be liberalised have been heightened by the Office of Telecommunications’ decision last March in favour of US satellite provider Pan American Satellite which complained that British Telecom was stalling over providing up-links to its service. And more immediately, the Department of Trade & Industry will award six licences to operate point-to-multi-point satellite services by the end of the year. A history of stranglehold regulation putting satellite communications firmly into the control of governments, largely because of the technology’s role in military intelligence, now looks set to change with the balance being redressed in favour of the consumer. European governments have to date been less zealous than the US in their efforts to open up the market. But John Avery, assistant secretary at the UK Industry Department recently offered a confident analysis of the implications for Europe of three important regulatory developments at a conference entitled Satellite Communications for Business Users hosted by IBC Technical Services. First, he noted that the Office of Telecommunications is currently sifting through the 26 applications received by the Department to operate a single-point to multi-point satellite service. Six licences are on offer, and big industry names, including the London International Stock Exchange, British Aerospace Plc and Reuters Holdings Plc are lined up with their applications. The Office of Telecommunications is busy finalising its recommendations which it was due to present to the Department at the end of last month. While government sanction of the new licence represents an important move to open up the industry, the scope of the licence is limited. Broadcast-only services rule out some of the satellite applications that are most popular in the US – credit card verification and electronic funds transfer at the point of sale, point out industry critics. The Department has barred two-way communications from the licence because it is determined to uphold the existing duopoly in the public carrier until 1990, when the position will be reviewed. Meanwhile the whole issue of how competition will develop in two-way communications or even how broadcast-only services can be extended over national networks has yet to be resolved. However, Avery believes that the Oftel PanAmSat ruling is a significant indication of the drive towards competition in the UK. If arrangements proceed to plan, PanAmSat will be operating the first but by no means the last of the privately owned satellites to provide international services he confirms. Bryan Carsberg, Director General of Telecommunications, ruled that British Telecom would have to provide up-links to PanAmSat’s satellite, should a customer in the UK request the connection. The PanAmSat satellite is the first of six US independent satellite systems to be launched into orbit, licensed by the Reagan Administration as an alternative to the international services provided by Intelsat and also to provide communications for domestic customers. PanAmSat’s negotiations with British Telecom for up-links from its UK network were unfruitful and the US party filed a complaint with Cars
burg in July 1987. He ruled that a customer request would oblige Telecom to provide either a dial-up link over its public network or supply the customer with a private leased line. Alternatively, Avery maintains that PanAmSat would be eligible for a value added data services operator’s licence, but only if it added value to every single message transmitted. While this makes an unlikely scenario at present, discussions are under way between the US and the UK to widen the scope of services permitted under the value-added data services licence. While the might of an established operator has been successfully challenged in the UK, Avery points out that the European Commission is trying to build a wider framework for the introduction of competition. The Commission’s Green Paper on the development of the Common Market for telecommunications services and equipment came out in June 1987 and made two key points concerning satellite. Receive only First, the regulatory regime for receive-only earthstations should be fully open to competition and second, that two-way satellite comunications and the regulation of up-links need individual consideration. However, a concerted move by Europe’s PTTs down the liberalisation path is unlikely. Progress will be hampered by the fragmented levels of competition so far introduced into the member countries by their governments. To date the European Community has forced the pace in the terminal equipment market which has been thrown open to competition – but the fiat is being challenged in court by France, which sees the move, however desirable the end happens to be, as a dangerous precedent for government by Brussels diktat. A target date to define the future regulation of two-way satellite communications, and the growth of the earthstation market has been set for the end of the year. Satellite Communications For Business Users is published by IBS Technical Services, Bath House, 56 Holborn Viaduct, London, EC1.