bill%gauss@gatech.edu (bill) (03/23/91)
By LAURIE ASSEO
Associated Press Writer
WASHINGTON (AP) -- A federal appeals court Tuesday voided a
government license for a proposed satellite system that aims to
provide nationwide mobile telephone service.
The Federal Communications Commission did not justify its decision
to give the license to a consortium of companies instead of following
the usual practice of holding hearings on competing proposals, said
the U.S. Circuit Court of Appeals for the District of Columbia.
The court ordered the FCC to reconsider the license.
"We regret that our present decision has the effect of delaying the
provision of a valuable and innovative communications service to the
public," the three-member panel of judges said.
Currently, mobile telephone service is available in areas with
land-based stations to relay the signal, generally urban areas.
The planned mobile satellite system, proposed in 1982 by the
National Aeronautics and Space Administration, would relay signals by
satellite. That would allow communication in rural areas not now
served.
NASA's original petition said the mobile satellite system would
enhance emergency communications in rural areas and also help
truckers, oil companies and others with operations outside existing
mobile systems.
The commission awarded the mobile satellite license in August 1989
to the American Mobile Satellite Corp., a consortium of companies. The
commission decided that hearings to compare various offers would be
too time-consuming and would delay the service, the court said.
The license was challenged by Global Land Mobile Satellite Inc.,
Globesat Express and Mobile Satellite Service Inc. Those companies had
applied for the license but dropped out after refusing to pay a $5
million cash deposit that was required of all companies that sought to
join the consortium.
The commission's decision to approve a consortium denied the other
applicants a chance to try to prove they had a better plan, the court
said.
The commission must have "truly compelling grounds" to abandon its regular
procedure of holding hearings on competing applications, the judges said.
In ordering the commission to reconsider the license, the court
said it could issue a license to a consorium only if it could
demonstrate grounds for doing so.
The court also voided the requirement for a $5 million deposit,
saying it appeared to be "nothing more than an arbitrary device by
which the commission was able to winnow the applicant field."
Commission attorney Gregory M. Christopher said it was too early to
say whether the commission would appeal the ruling or ask the court to
reconsider it. But he said he expected negotiations toward a possible
settlement.
The ruling "deals a setback to our plan to have this service
initiated as quickly and as cheaply as possible," Christopher said.
"We gave everyone an equal opportunity to participate."
The consortium estimates the system will cost about $300 million,
Christopher said.
Attornies for the consortium did not immediately return phone calls
seeking comment.
The Court of Appeals also rejected a challenge to the license by
another applicant, Aeronautical Radio Inc. That company's application
was rejected because it did not comply with FCC standards, the court
said.
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Bill Berbenich Georgia Tech, Atlanta Georgia, 30332
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