Advanced Television

CBA: ‘Catch 22’ dilemma

March 6, 2020

By Chris Forrester

Intelsat has yet to confirm its intentions as far as the FCC’s Order is concerned over the FCC’s accelerated clearing plan. Indeed, Intelsat is silent on whether it wants to proceed at all, and only a week or so ago, the market was awash with reports that it was being urged to consider a Chapter 11 bankruptcy.

The problem is that if Intelsat does not proceed with the FCC’s scheme, the regulator can scrap the whole process.  The FCC is cannily requiring that at least 80 per cent of the participants must participate in the project. With Eutelsat and Telesat (and Brazil’s StarOne) barely accounting for 9 per cent of the spectrum on offer under the scheme then Intelsat HAS to agree with SES to proceed or the whole pack of cards falls.

Intelsat will receive the largest payout (of some $4.87 billion) in terms of incentive payments if it participates, plus having its technical and new satellite costs covered by the auction’s winning bidders.

SES and Telesat have made no secret that they wholly support the FCC’s scheme. SES ‘lost’ some $23.7 million out of its initial anticipated payout, but still will receive $3.97 billion if it meets the FCC’s incentive targets.

The snag now is that the FCC’s clock is ticking. The FCC wants to establish its ‘Clearinghouse’ operation – with SES and Intelsat participation – speedily.

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