Commercial Space Transportation – End of a Government Monopoly

For many years after the launch of Explorer I in 1958, conventional wisdom and generally held per­ception was that space activities were, and should be, the exclusive domain of national govern­ments. Only NASA, the military services, and the National Reconnaissance Agency29 were permit­ted or able to engage in launch activity. Although some commercial payloads were placed in orbit as early as the 1960s, the launching of them was strictly a government business. This view prevailed in spite of the fact that the United States has long based its successful economic system on private enterprise, with the role of government being lim­ited and supportive of the private engines of com­merce. This government-private sector symbiosis was the dynamic partnership that we described at the beginning of this book, and it has been the norm in every industrial, technical, and a scientific advance seen in the United States. We will first look at the development of the law that is making this transition possible.

The Communications Satellite Act of 1962

When Sputnik was launched on October 4, 1957, telephone communications across the oceans were sent through large undersea copper cables. Televi­sion transmissions were sight limited and unavail­able for overseas transmissions (or other long distances) due to the curvature of the earth’s sur­face. In the United States, American Telephone and Telegraph (AT&T) advanced the idea in the early 1960s of its funding a communications satellite that could be used to relay television sig­nals across great distances, including the Atlantic Ocean to Europe.

While the promise of this great technological advancement was intriguing, the anticompetitive aspects of such an arrangement were daunting and, under American law, possibly illegal. There was also the matter of private enterprise now being inserted into space operations that had always been reserved for government function worldwide (the United States and the U. S.S. R.).

The solution was to create a quasi-public corporation to own the satellite under government regulation. This was accomplished by passage of the Communications Satellite Act of 1962, and it created Comsat Corporation as the owning and operating entity. The Telstar satellite, built by AT&T and launched by NASA on July 10, 1962, became the first direct-relay communications sat­ellite. While AT&T owned 29 percent of the cor­poration, the majority of shares were distributed so as to insure independence. AT&T controlled six directors, the other shareholders an additional six, and three were appointed by the president of the United States.

One of the problems with Telstar was that it had been placed in low earth orbit, which required movable receptor dishes to track the satellite in order to pick up its signals as it tra­versed the sky. Hughes Aircraft was a competitor of AT&T and suggested placing one of its satel­lites in geostationary orbit (GSO), which would eliminate tracking requirements of the satellite by receivers. NASA approved and the first Syncom satellite reached high orbit in 1963.

The geostationary orbit is a unique, circular orbit plane directly above the earth’s equator. By “unique” is meant that there is only one GSO, which is the orbital plane at zero degrees inclina­tion. A satellite placed in this orbit will appear to hover directly over the same point on earth above the equator at all times.30 A GSO satellite orbits at an altitude of about 22,236 miles above earth.

Since GSO is unique, the number of satellites that can be placed in it is limited. A system of slots is being monitored by the United Nations to insure fairness in allocation of GSO participation among nations.

In August 1964, a second organization was formed for the propagation of international sat­ellite telecommunications. The International Telecommunications Satellite Organization, or Intelsat, was created by 11 separate nations with control in its board of directors weighted to reflect the member nation’s volume of communi­cations. Comsat controlled over half the board of directors. Its first satellite, known as Early Bird, was purchased from Hughes Aircraft and was launched into GSO orbit in 1965.

By 1969, global coverage had been achieved by Intelsat by the placing of three satellites over the Atlantic and three over the Pacific. A sev­enth, in GSO over the Indian Ocean, linked Lon­don and Tokyo and completed the system.

Before the Europeans developed their own satellite launching systems, NASA launched foreign telecommunications satellites known as Symphonie in 1974 and 1975, owned by France and West Germany. Intelsat was by now serving some hundred different countries, some of whom had never even had local television service or had ever laid any significant telephone lines within their own borders, such as Bangladesh and large portions of Africa.