Two Barriers to Collaboration: French Ambitions and. Intelsat’s Mission

NSAM294: Curbing France—Two major hurdles stood in the way of mov­ing beyond scientific to technological collaboration with Europe, notably in the strategically key domain of launchers. The first was enshrined in NSAM (National Security Action Memorandum) 294, signed by McGeorge Bundy and dated April 20, 1964. NSAM294 was a response to de Gaulle’s determination to develop an independent nuclear deterrent, including guided missiles, and the French president’s dislike for international and supranational institutions (includ­ing the North Atlantic Treaty Organization, NATO) that restricted France’s sovereignty and autonomy of action. For Washington, to curb proliferation on the continent “it continues to be in this government’s interest not to contrib­ute to or assist in the development of a French nuclear warhead capability or a

French national strategic nuclear delivery capability.” To that end NSAM294 directed that “effective controls be established immediately” to stop “exchanges of information and technology between the governments, sales of equipment, joint research and development activities, and exchanges between industrial and commercial organizations [. . .], which would be reasonably likely to facilitate these efforts by significantly affecting timing, quality or costs or would identify the U. S. as a major supplier or collaborator.”13 Closing the technological gap with France in the domain of rocketry would undermine the stability of the Atlantic alliance that the United States hoped to construct to meet the Soviet threat, rather than contributing to the defense of the free world.

NSAM338 Promoting Global Telecommunications—The second major stum­bling block to technological sharing was the administration’s determination not to launch foreign satellites for “separate systems,” which would do “significant economic harm” to an American-led global telecommunications satellite system. US-European tensions over this issue threatened to sabotage the collaborative process in the 1960s and early 1970s, and their evolution over the decade will be treated in detail in what follows.

In his famous speech before Congress on May 25, 1961, President Kennedy not only committed the United States to put a man on the moon before the decade was out, he also called for the establishment of a single, global commu­nications satellite system. Soon thereafter a White House press release dated July 24, 1961, invited all “nations to participate in a communications satellite system, in the interest of world peace and closer brotherhood among peoples through­out the world.” The president called for the establishment of a privately owned corporation, Comsat, to handle the American portion of the system. He also made it clear that he wanted Comsat to establish the system quickly to ensure an American space first.14 The Communications Satellite Act, signed into law by Kennedy on August 31, 1962, authorized Comsat to “plan, initiate, construct, own, manage, and operate itself or in conjunction with foreign governments or business entities a commercial communications satellite system.”

Kennedy’s proposal challenged the domination by Britain of an international communications network of submarine cables. It also politicized an ongoing busi­ness-led communications satellite enterprise.15 It recognized the cultural impor­tance of an American-led global communications system: a main leitmotif in the May 1961 speech was, after all, the use of space technology to win the hearts and minds of those who were faced with a choice between “freedom and tyranny.”16 It was also a more immediate, pragmatic, and commercially important way of “selling” space to the American public than a remote and immensely challenging lunar landing. These aims—the creation of a commercial entity that would both be profitable and promote an American foreign policy agenda in the context of intense Cold War rivalry—dominated the negotiations surrounding the definition of the role of Comsat. They influenced its relationships with the administration (notably the State Department and the Federal Communications Commission (FCC)), and with European telecommunications entities and governments.17

It was assumed from the outset that, to ensure the most efficient utilization “of a very rare resource—the electromagnetic frequency spectrum,” Comsat would establish a single global system: competing global, regional, or national systems would be discouraged. This would avoid “unnecessary and wasteful” economic competition, the needless duplication of technologies, and facilitate the standardization of equipment.

The global system foreseen by Comsat distinguished sharply between the financ­ing and management of space and ground segments. The space segment comprised all of the satellites in the system, along with their supporting tracking, control, and command facilities. It would be jointly owned and financed by the participants (nations, groups of nations, or regions), whose capital investment would be propor­tional to their potential use of the global system. The ground segments would com­prise stations transmitting and receiving data from satellites and would be under the control of national private or public telecommunications entities.

The Europeans, organized through a new European Conference on Satellite Communications (CETS), were concerned from the outset about what they saw as American dominance in Comsat. In a key meeting in Rome in 1964 they voiced their hesitations over the dual role of Comsat as having both a major role in defin­ing policy and as managing the system. They were also concerned by a procurement policy that was based on accepting the technically and financially best bid from aerospace industries. This would necessarily favor US high-tech industry, given the huge technological lag between the two sides of the Atlantic at the time.

Italian ambassador Edigio Ortona opened the Rome meeting. He spelt out CETS’s position. He suggested that the global comsat system should be “owned and managed by a world organization” to ensure that all the participating countries could have an “adequate voice” in its management.18 This should be entrusted to a multinational general conference in which each country had one vote “in principle” on most matters. Ortona also urged that in the early stages of the system special provision should be made for European industry so that it could close the technological gap with the United States.

The American delegation rejected these proposals outright. It would proceed at once to raise the capital for the global system with or without the Europeans. Comsat would manage the space segment (while each country would control its own ground segment), and voting would be determined by investment (which in turn was based on a country’s use of the system).19 Financial share would be correlated with projections of traffic data based on the use that countries made of international cable facilities: this meant that the United States’ voting weight would be greater than 50 percent, perhaps as much as 65 percent. Contracts would be awarded competitively, thus effectively ensuring that no European firm could hope to participate significantly in the early technological fruits of the system. To rub in the point, in March 1964 Comsat announced that it had contracted with Hughes Aircraft Co. for the design, manufacture, and testing of two synchronous orbit communication satellites “to demonstrate to the Europeans,” as one US negotiator put it, “that their refusal to agree would not hold up the system.”20

The Europeans had little choice but to accept the US conditions. To satisfy their concerns it was agreed that the legal agreements then adopted would only apply in the interim. They would be reevaluated by an Interim Communications Satellite Committee (ICSC) in 1969, when steps would be taken to set up a per­manent organization whose operation would be defined by the newly negotiated definitive agreements. The interim voting procedures were the very last to be settled. The United States would (initially) have 61.0 percent of the vote in the Interim Committee, followed by Britain (8.15 percent), and France and Germany (6.1 percent each). As more countries joined the organization so the percentage shares would shift, but it was agreed that, in any event, the US share of the vote would not drop below 50.6 percent. Decisions would be taken if accepted by the United States along with other countries whose combined vote was “not less than 12.5%.” This effectively stopped France and Germany (12.2 percent together) having a veto over all decisions.

The interim agreements establishing the first multinational communica­tions satellite organization were opened for signature on August 20, 1964.21 The governing body of the consortium was called Intelsat—the International Telecommunications Satellite Corporation. Its executive instrument was the ICSC. Intelsat had overall responsibility for the design, development, estab­lishment, and operation of the single global system that would be managed by Comsat. A related Special Agreement dealt with the ground segment. By the end of 1965 the number of participants in the consortium was 46: no communist country was among them. The initial estimate for the cost of the space segment was $200 million. It would provide voice, telegraphy, broadband data, high-speed data, and television services. Comsat’s investment quota, which translated into voting weight on the interim committee, was a little more than 56 percent at the end of 1965. Western European countries had a share of about 28 percent.22

The initial structure of Intelsat ensured US preponderance in the system. As Charles Johnson, a senior official in the Johnson administration, put it, Intelsat was “an unusually attractive international vehicle for the U. S.”23 Since the interim agreements stipulated that the United States’ voting weight could never drop below 50 percent, “we control.”24 All the same, as more countries sought to exploit the new opportunity, Comsat, as manager on behalf of an international consortium, was obliged to encourage bids from foreign firms for equipment for the space seg­ment. NSAM338 was promulgated on September 15, 1965, to meet this chal­lenge.25 The “core” of NSAM 338, to quote National Security Adviser McGeorge Bundy was “to use our technological superiority to discourage commercial compe­tition with Comsat and/or wasteful investment in several duplicative Free World defense-related systems.”26 The United States would provide technical information, launch vehicles, and launching services to other nations only when they assured the administration that “what we supply is needed to develop or use the global com­mercial system.”27 For military communications, the administration’s “aim was to encourage selected allied nations to use the U. S. national defense communications satellite system rather than to develop independent systems, and to accommodate allied needs within the U. S. system.”28 In short through NSAM338 the United States aimed to use its technological preeminence and its veto powers in the Interim Committee as levers to restrict the proliferation of competitors to the single global telecommunications system that was managed by Comsat.

NSAM338 posed immense problems for NASA and the State Department. On the one hand, through the Intelsat agreements, the United States was encour­aged to help other countries build up their communications satellite industries so as to get some return on their investment in the international consortium. NSAM338 instructed them not to provide that support unless they were given guarantees that the benefactor did not build a satellite system that could do significant economic harm to the single global system being established by Intelsat. It also discouraged technological sharing in the domain of launchers, for fear that other countries would eventually seek to develop their own com­munications satellite system outside the Intelsat framework. NSAM294 added to these restrictions by insisting that technological assistance to Western Europe in the area of rocketry should do nothing to advance the French military pro­gram. These requirements bedeviled the efforts made by NASA and the State Department to share technology with Europe in the latter part of the 1960s.