Attachment petit for recon

petit for recon

PETITION FOR RECONSIDERATION submitted by DigitalGlobe

petit for recon

2005-10-31

This document pretains to SAT-MOD-20040728-00151 for Modification on a Satellite Space Stations filing.

IBFS_SATMOD2004072800151_465072

Message Page L of 1 Denise Berger From: Kelld. Riterpusch fkitterpusch@comspacelan.com} Sent: Monday, October 31, 2005 455 PM 1BSecretary Co: Kathleen Campbol; Andrea Kely; Cassandra Thomas; ‘Bettina Eckere‘; Walter S. Scoft; Mark Fickers‘ subjest: Digltitobe Beliion tor Seconsideratinn of Order and Authorisation {ele No. Bor—mol—comres To Whom It May Concem—— Please find attached hereto a Petition for Reconsideration of the Commission‘s Order and Authorization dated September 30, 2005 authorizing the modification of DigitalGlobe‘s NGSO remote sensing satellte system. The applicable FCC File Number is SAT—MOD—20040728—00151. Ifthere should be any problem with processing this pleading, please give me a call or e—mail me. Cordially yours, Pierson & Ritterpusch, LLP Keil J. Ritterpusch aeceuepa INseeCteD Kell J. Riterpusch, Esq. OCT 3 1 2005 Pierson & Ritterpusch, LLP 2121 Cooperative Way, Sute 200 FCG — MAILR 00M Hemdon, VA 201 _ (70%) 562—3000,x. 205 Ees (10) 56—3089 cal: (705) ste—sze3 kriterpusch@comspactiasccom This message is intended only for the use of the individual or entity to which it is addressed, and may contain information that is Attomey Privileged, Confidential, and exempt from disclosure under applicable law. If the reader ofthis message is not the intended recipient, or the employee or agent responsible for delivering the message to the intended recipients, you are hereby notified that any dissemination, distribution or copying ofthis communication is not permitted. If you have received this communication in error, please notify us immediately. Thank you. 11/,/2005

Before The Federal Communications Commission Washington, D.C. 20554 REcENED & INSPECTED h OCT 3 1 2005 In The Matter of ; FCG — MAILRACOM DigitalGlobe, Inc. ) ) File No. SAT—MOD—20040728—00151 Modification of Authorization to Construct, ) Call Sign: 521 k Launch and Operate a Remote—Sensing Satellte ) Received System ) i nov 0 8 2005 To: Secretary, Federal Communications Commission, Policy Breach Washington, D.C. 20554 ralBureau PETITION FOR RECONSIDERATION OF BOND REQUIREMENT AMONG OTHER MATTERS PROVIDED IN ECC ORDER AND AUTHORIZATION, DA 05—2640 DigitalGiobe, Inc. (‘DigitalGlobe‘"), though counsel, pursuant to Section 1.106 of the Commission‘s rules, hereby requests that the Commission reconsider and waive the bond requirement set forth in Order and Authorization DA 05—2640 (hereinafter, "Order") issued on September 30, 2005." As an alterative to waiving the application of the bond requirement to DigitalGlobe, DigitalGlobe requests that Commission rule that: (1) NGSO remote sensing satelites are GSO— like for purposes of the bond requirement; (2) the appropriate bond for NGSO remote sensing satellte systems is $3,000,000; (3)there are only four milestones required for the construction of NGSO remote sensing satelite systems; and (4) an NGSO remote sensing system licensee will fulll the milestone requirement by constructing, Iaunching, and bringing into operation the frst satellite in its NGSO remote sensing satelite system. ‘ n the Materof DiialGlob,In. Modifcation ofAuthoriation tConstrct,Launch and Opert Remot— Sersing Saelie SytemOrder and Autorisaton, DA 0%—2640, ECC LEXTS Si27 (200%) (Onder.

In the event that the Commission authorizes an NGSO remote sensing satelite operator in a license modification to operate new satellites using more bandwidth per satelite than previousty authorized, we would accept a new $3,000,000 bond being imposed on the licensce. However, we request that the Commission rule that the bond would be fulfiled by the NGSO remote sensing system licensee launching and bringing into operation the frst satelite using the additional bandwidth. Further, we request that the Commission rule that there would be no bond requirement for the construction, launch, and operation of additional NGSO remote sensing satelites authorized parsuant to satelite modification applications, as long as such satelites wll operate only within already—authorized bandwidth. In addition to this Petition, DigitalGlobe notes that it filed a Request for Determination of Compliance with Satellte Implementation Milestones (*Requesr") on October 24, 2005, which the Commission has yet to issue a ruling on atthe time offiling this Perition. L ExecutiveSommary As part of the Order,the Commission has required that DigitalGlobe post a $5,000,000 bond to:(1) ensure that DigitalGlobe uses the entie spectrum that the Commission has authorized DigitalGlobe to us; and (2) prevent Digital Globe from warehousing the spectrum to use in tunlikely event thatbest case demand scenarios materialize orto delay compctitors from using it. DigitalGlobe believes that the bond requirement is unnecessary in this case for several reasons.. First, DigitalGlobe is a licensed remote sensing operator by the National Oceanic and Atmospheric Administration (NOAA®) and the process of being licensed by NOAA inhibits speculative and finzncially unqualified entities from being uthorized to operate remote sensing satellite systems, Second DigitalGlobe is committed to the U.S. Government (specifically, the i

National Geospatial—Intelligence Agency) to construct, Iaunch, and operate the satelites that are authorized by the Order. DigitalGlobe believes that this fact alone is conclusive evidence that DigitalGiobe is financially capable and committed to build and operate the authorized satelites Third, the warehousing of spectrum and orbitalresources by remote sensing operators in the United States is pragmaticallyimpossible due to NOAA‘s licensing requirements,the ability of ESS bands to be used by multiple users, and the abundance of orbital locations in which prospective operators can operate their systems. Altemmatively, however, should the Commission not be persuaded to rescind the bond requirement, DigitalGlobe requests thatthe Commission make the determination that DigitalGlobe‘s NGSO Remote Sensing Satelites are GSOlike, and, thereby, DigitalGlobe should be subject t only 4 milestones and the bond reduced to $3,000,000. Moreover, DigitalGlobe requests that the Commission establish that NGSO Remote Sensing System Licensees will fulfl their milestone requirements by constructing, launching, and bringing into operation the first satelite in their NGSO Remote Sensing Satellite Systems. For the good cause demonstrated below, we urge the Commission to grant the request to waive the bond requirement in the instant case. i

TABLE OF CONTENTS Executive Summary i Background There is Good Cause to Waive the Bond Requirement in the Order in Light of the Totality ofthe Circumstances related to DigitalGlobe‘s Construction, Launch, and Operation of ts Next—Generation Earth Exploration Satellte System ("EESS®) ... A. The Commission‘s Intent Behind the Bond Requirement B. Standard for Considering Petitions for Reconsideration and Waivers of Commission Rules C. Reasons Why the Commission Should Not Require DigitalGlobe to Post a Bond in the Instant Case 1.. DigitalGlobe is a Licensed Remote Sensing Operator by NOAA and the Process of Being Licensed by NOAA Inhibits Speculative and Financially Unqualified Enttes From Being Authorized to Operate Remote Sensing Satelite Systems 2.. DigitalGlobe is Contractually Committed to the U.S. Government to Construct, Launch, and Operate the Satellites thatare Authorized by the Order, which Fact is Conclusive that DigitalGlobe is Financially Capable and Committed to Building and Operating the Authorized Satellites 7 13 3. The Warchousing of Spectrum and Orbital Resources by Remote Sensing Operators in the United States is Pragmatically Impossible Due to NOAA‘s Licensing Requirements, the Abilty of the Band to Be Used by Mulbiple Users, and the Abundance of Orbital Locations in Which Prospective Operators can Operate their Systems . 16 iv

In the Event the Commission Decides Not to Waive the Bond Requirement, the Commission Should Rule that (a) NGSO Remote Sensing Satelites are GSOlike; (b)the Appropriate Bond Amount is $3,000,000; (c) There are only 4 Milestones for NGSO Remote Sensing Satellte Systems; and (d)an NGSO Remote Sensing System License Will Fulfill The Milestone Requirement By Constructing, Launching, And Bringing Into Operation The First Satellite In s NGSO Remote Sensing Satellite System... 20 Enatum 2s Conclusions 2s

1. Background The Order granted DigitalGiobe authority to modify DigitalGlobe‘s Non—Geostationary Satellite Orbit (NGSO®) satelite system:* Within the Order, the Commission required DigitalGlobe to fulfill certain milestones for constructing the authorized satelites and modifying its space segment (Order, para. 11).. Also, the Commission required that DigitalGlobe post a bond by October 30, 2005 in the amount required by the Commission‘s rulesfor the construction and operation of an NGSO satellte system: five milion dollars ($5,000,000) (Order, paras. 12— 13). ‘The bond requirement was imposed in order to ensure that DigitalGlobe uses the entire spectrum that the Commission has authorized DigitalGlobe to use. ‘The Commission‘s stated purpose for the bond was to prevent DigitalGlobe from " ‘warchousing‘ the spectrum to use in the unlikely event that ‘best case‘ demand scenarios materialize or to delay competitors from using it" (Order, para. 13. 11L There is Good Cause to Waive the Bond Requirement in the Order in Light of the Totality of the Circumstances related to DigitalGlobe‘s Construction. Lounch. and Operation of Its Next—Generation Earth Exploration Satellite System (@EESS" A«— ‘The Commission‘s Intent Behind the Bond Requirement The genesis of the bond requirement lis in the First Notice of Proposed Rulemaking and First Report and Order, otherwise known as the Space Starion Reform NPRM,® whose principle aim was to streariline the Hicensing process* In the Space Station Reform NPRM, the Commission noted that an important aspect of the licensing process was an assurance that * Order (pua. 1 > Sein the Mater of Amendment ofthe Commission‘s Space Sution icensing Rules and Plices, Notce o" Preposed Rulenatingand Firt Repor and Order, 1B Docket No.02:34, 17 FCC Red 37, t 3880—84 (paas, 98« 10%) 2002) (Gpace Stion Agorm NPRIN. * Space Saton Reform NPRM, 17 FCC Red a 3852 (pae. 11).

applicants for U.S. space station licenses have the technical and financial wherewithal to construct and operate a satelfte." At the time of the promulgation of the Space Starion Reform NPRM, the Commission‘s Rules required an analysis of the financial positon of prospective licensees such that the Commission could be assured that the licensee could undertake to actually construct and launch the satelite covered by the license® Noting that the then—current "financial qualification requirement" and the milestone policy serve essentially the same purpose, the Space Station Reform NPRM, at paragraph 108, requested comments on the necessity or effectiveness of the financial qualification requirement, as such requirement "provides only a preliminary. and therefore possibly imprecise assessment of whether an applicant is able to proceed. with construction,Iaunch, and operation."" In 2003, the Commission promulgated the Space Starion Licensing Reform Order® in which the Commission, among other matters, liminated the financial requirement then current in the Commission‘s Rules and addressed numerous comments made by stakcholders on the Space Station Reform NPRM."—In the Space Station Licensing Reform Order, the Commission adopted a proposal by Intelsat, based on a previous Order related to paging companies,that in Hiew of a financial qualification requirement, the Commission would require the posting of a Bond. In particular, the Commission noted that: By requiring satellite licensees to make a financial commitment to construct and launch their satellites, " space Staton Reform NPRIM,17 FCC Red at 3860 us 100) t " pace Staton Reform NPRIH, 17 FCC Red at 3881 us 100) " See o the Mater of Amendment of the Commisson‘s Space Sution Licesing Ruls and Poliie; Miigatonof Orbial Debrs,Frst Repor and OrderTB Dockst N. 02—34,18 FCC Red 10760 (2003) (Space Surion Hcensing Reform Orde, * space Staton Licensing Reform Order, 18 FCC Red at 10624 pun. 166)

we help deter speculative satellite applications, and help expedite provision of service to the public." In addition, the Commission declared that replacing the financial qualification requirement with a bond requirement would "result in the financial community determining whether the lcensec is likely to construct and launch ts satelite system", thereby ensuring that the process would be "market driven rather than a regulatory determination‘‘. The Commission further opined in the Space Station Licensing Reform Order that the bond requirement would be applied to new satelite licensees only, not replacement satelites. The Commission specifically provided that "once a licensee has begun to provide service, we are confident that its replacement satelite application will be intended to continue service, and would not be filed for speculative purposes."" In the Space Station Licensing Reform Order, the Commission envisioned a system where prospective licensees would execute performance bonds payable to the U.S. Treasury within thirty (30) days of the grant otheir licenses."" The bond would be exccuted in the event of a licensee missing any of the milestones without adequate justifcation: ""Thus, the bond requirement is in effect an additional milestone requirement. We intend this bond requirement to provide assurance that the licensee is fully committed at the time it‘s license is granted to construct its satelite facilis...."" In sum, the Commission states: By making the bond payable upon failure to meet any milestone based on circunstances within the licensee‘s control, we require licensees to commit to construct and launch its satellite system and so we further strengthen our protections against speculation and warehousing. * " Space Staion Licensing Reform Order, 18 FCC Red t 10828 (pae. 167 " Space Staion Licensing Reform Ordr, 18 FCC Redat 10828 (pe. 167. 1 OpaceStation Licensing Reform Ortr, 18 FCC Red at 10826 (par 170. ue "

In the Commission‘s most recent ruling regarding milestones and the bond requirement, the Fift Report and Order, * the Commission established the authority to require a bond and described the rationale behind the bond requirement."*In particula, the Commission clarified that the bond requirement was a new financial qualification requirement."". n addition, the Commission re—terated. that it imposes financial qualification requirements to help prevent warehousing ofthe orbitpectrum resource, by ensuring that satelite liensees have the financial resources necessary to construct and launch a satellit"". Finally, the Commission stated that requiring satellite Hicensees to make a real financial commitment to construct and launch a satelite, and to demonstrite to a surety company that they will be financially able to proceed, limits the likelihood that the Hcensee will hold a Hicense simply to preclude another party from going forward."" Thus, the Space Station Licensing Reform Order and the Fifth Report and Order did not exactly replace the financial qualifcations requirement with the bond requirement. The purpose of the financial qualification requirements was to ensure that prospective licensees would not warchouse spectrum or delay prompt service to the public because of financial insbility to complete the system authorized by their license, ‘The Commission felt that these two policy goals could be better met, while simultaneously "streamlining" the Hicensing process, by strict enforcement of the milestone requirements.° ©tnthe Mater of Amendnentof the Commisson‘s Space Sution Licensing Rulesand Polics, it Onder on Reconsideraon and Fith Report and Order, 18 Docket No,02—24, 19 PCC Red 12637 (2004)h Reportand Qrten. i Seegenerals, itReportand Onder, 19 PCC Red 12637. © Fifh Report and Order, 19 FCC Red at 12646 on 19 "re "Fith Repor and Order, 19 FCC Red at 12642412683 (pan. 12) ® Space Sation icensing Rform Order, 18 CC Red at 10828 (par. 179) a

‘The Commission argued that the financial weakness of a company would be uncovered and automatically acted upon were that company to miss a milestone.. Warchousing would be avoided because at the moment a milestone is missed, barting pending motions to extend the time of the milestone for good cause, a licensee‘s license becomes null and void and the portion of the spectrum allocated to that licensee would become availible once again to new applicants."" The Commission appears to have added the bond requirement as an additional measure to limit speculative license seekers and as a means for the financial community to assess the fiscal stength of a company before continuing down the construction, launch, and service— provision path punctuated by the milestones. While the Space Station Licensing Reform Order claimed to be replacing the finzncial qualification requirement with the bond requirement" it is clear that both the bond requirement and strict milestone enforcement operate tolimit the probabilty that speculative license seckers will obtain licenses without having the prerequisite financial abilty or commitment to constructing the systems that they are authorized to operate. Within the Order, the Commission provided that the Commission had eliminated the financial requirements then in place in the Commission‘s Rules and replaced them with the bond requirement®" The Commission explained that DigitalGlobe must file a bond because:. (1) "remote sensing satelite operators are not exempt from the bond requirement in circumstances where they propose to operate a next—generation satelite system using aditional frequencies for which they are not currently authorized""" and (2) DigitalGlobe had received authorization from © Space Sation Reform NPRK, 17 FCC Red at 3882.3883 (pas. 109} see alo, 47 CER. § 2.160. 2 Space Ston Licensing Reform Onder, 18 PGCRed at 10828 . 167) 2 Onter, FCC LEXIS 5427 (pan 12) " Orter, RCC LEXIS 5427 (pan 13)se also, FIth Reportand Order19 PCC Red at 12658—12699 (pan.58)

the Commission to operate three new satelites in its NGSO remote sensing satelite system in frequencies not previously authorized by the Commission"" Thus, the apparent rule that currently applies to NGSO remote sensing satellite systems is that they have to post a bond only when the Commission authorizes modifications of their satllite system whercby new satelltes will operate in frequency bands that are not part oftheir prior authorization. B. Standard for Considering Petitions for Reconsideration and Waivers of Commission Rules In considering whether to grant the instant request, DigitalGlobe understands that the Commission must consider whether there is good cause"" for waiving its rule in the particular case..In making this determination, DigitalGlobe further understands that the Commission must assess whether the grant would have an effect of undermining the policy in general and would otherwise serve the public interest."" Accordingly, DigitalGlobe herein provides an explanation regarding why: (1) there is good cause to grant he Motion; (2) the Commission‘s policy will not be undermined by granting DigitalGlobe‘s Motion: and (3) granting the instant Motion will serve the public interest. DigitalGiobe understands that the Commission has not yet permitted the waiver of the bond requirement for any satelltes licensed since the bond requirement was implemented. Therefore, tinstant petition provides the Commission with a matter of firs impression. Thus, there is no directly on point precedentin the instant case and the only on point standard that 5 order, FCCLEXIS 5427 (pan 13) 47 CER § 13 seeato, Fith Repor and Onter, 19 FCC Red t 12646 (pam. 19) * See <3.Seeand Round Asignment of Geonationary Saelite Orbt Loctions to Fzed Stelte Servce Space Staions in the Ka—Band, 16 FCC Red 14309at 14992—14395 (pwn. 12ciing WAFTRedlo . FCC, 418 Fad 1153, ac 1197 (D.C.Ci. 1969certdenied409 US. 1027 (972,

applies is whether there is "good cause" for the suspension, revocation, amendment, or waiver of the pertinent rule in the instant case."" . Reasons Why the Commission Should Not Require DigitalGlobe to Post a Bond in the Instant Case The Commission‘s stated purpose for the bond requirement, as delincated in detail sbove, is to ensure that only those licensees who are financially committed and able to construct, Inunch, and operate satelites are liensed by the Commission.. In addition, the Commission has stated that it desired for he financial community to be involved in determining whether lcensees were financially capable of building satelites they are authorized to operate.®" Finally, although it is not per se addressed in any of the Commission‘s prior orders or other rulemakings, it is apparent that the Commission wanted to have a "milestone"that was earlier than the time ofthe first performance milestone (e., contract execution)—generally one year after license grant. The purpose of this earlier "milestone" was ostensibly to ensure more quickly that licensees made concrete decisions on whether to accept the responsibility of constructing, launching, and operating their licensed satelite systems than one year from the date of grant. Therefore, the Commission established the 30—day timeframe by which licensees must file bonds to demonstrate their financial commitment and abilty to construct, launch, and operate thsatellites in their authorizations asa "preliminary" financial qualification mechanism— Applying the bond requirement to DigitalGlobe in the instant case is unnecessary because: (1) DigitalGlobe is a licensed remote sensing operator by the National Oceanic and Atmospheric Administrtion (‘NOAA®) and the process of being liceised by NOAA inhibits speculative and financially unqualified entities from being authorized to operate remote sensing satelite systems; *norg1s " Space Sution Lcensing Reform Order, 18 FCC Red a 10825 (pws.167)

(2) DigitalGlobe is committed to the U.S. Government to construct,launch, and operate the satelites that are authorized by the Order, which fact is conclusive that DigitalGlobe is financially capable and committed to build and operate the authorized satelites; and (3) the warchousing of spectrum and orbital resources by remote sensing operators in the United States is pragmatically impossible due to NOAA‘s licensing requirements, the ability of EESS bands to be used by multiple users, and the abundance of orbital locations in which prospective operators can operate their systems. 1. DigitalGlobe is a Licensed Remote Sensin erator by NOAA and Process of Being Licensed by NOAA Inhibits Speculative and Financially Ungualified Entites From Being Authorized to Operate Remo in Satellite Systems DigitalGlobe operates its remote sensing satelite system under authority ofthe Secretary of Commerce in accordance with dictates ofthe Land Remote Sensing Policy Act of 1992 (the "Remore Sensing Act"),"the regulations promulgated by NOAA under delegated authority from the Secretary of Commerce (°NOAA‘s Regulations®),"" and the terms of the license issued by the Secretary of Commerce to DigitalGlobe."" In particular,the Remote Sensing Act provides that: "No person who is subject to the jurisdiction or control of the United States may, directly or through a subsidiary or affiliate, operate any private remote sensing space system without a license pursuant to Section 5621" of titl15 of the United States Code. NOAA‘s Regulations extend the entiies that are captured by "* Land Remote Scnsing Actof 1992 (Remote Sersing Ac), 15 U.SC. §§ S621, t se, (2009) 15 CRPar 960 2005 " DigialGlobe‘s licene rom NOAA to opera it remot seningstelit sstem haseloments thatar clasifed. As a resilt,DigialGlob is noatibrtyto submitacapy o ts eens, Ithe Commision desizes o undeand anyof he specfc terms ofDiialGiobe‘s NOAA Hcerse, lese contact Kay Westo, Chieof the Saelite ActivitesBranch ofthe NOAA Satelie and Ieformation Servce CNESDIS") at 301)713—2024, . 20.

their regulations to include persons subject to the jurisdiction or control of the United States who propose to operate private remote sensing space systems," In terms of the licensing process applicable to remote sensing satelite systems, the Remote Sensing Act provides that «»»[nlo license shall be granted by the Secretary [of Commerce) unless the Secretary determines that the applicant will comply with the requirements of [the Remote Sensing Act], any regulations issued pursuant to [the Remote Sensing Act], and any applicable international obligations and national security concerns of the United States.""‘ NOAA‘s Regulations further provide that the Secretary‘s determination must be in writing" and that lcense applications received must be disseminated to, reviewed by, and approved by the Department of Defense, Department of State, Department of the Interior, and any other interested federal agency before NOAA may issue a license."" A prospective remote sensing satelite operator must furnish the Secretary of Commerce in its application to operate a remote sensing space system detailed information regarding the ownership and affiiations of the prospective licensee, as well as detailed technical information regarding the operation ofthe launch, space, and ground segments of the remote sensing space system."" This information is used by NOAA to determine the applicant‘s "suitability to hold a private remote sensing space system license.""" Appendix 1 to NOAA‘s Regulations specifically provides that applicants must provide NOAA with the following information (among other information): ituemorkpoida meonn. Tiscrr smmen. * See, CER § 960.6(aand Appendix 2 o Par 0. "" See, Remore Sersing Act, § 562205 seealo, 15 CR § 9606, Appondix 1, o Par 960,and Appeodia 2 t Par 960. * 18 CFR. Appendix 1 to Part960, t subsecion (0.

(1) the proposed Iaunch schedule; (2) the proposed launch vehicle source; (3)the propased launch site; (4)the anticipated operational date; (5) the range of orbits and altiudes (nominal apogee and perigec); (6) the inclination angle(s); (7) the orbital period(s; (8) the number of satelites which will comprise the system; (9) technical space system information at the level of detail typical of a request for proposal specification; (10)the command (uplink and downlink) and mission data (downlink) transmission frequencies and system transmission. (uplink. and downlink) footprint; (11) the downlink date rate and any plans. for communications crosslinks; (12) the applicant‘s plans for protection of uplink, downlink and any data links; and (13) other data pertinent to the imaging capsbilites of the system."* Applicants are required to provide data regarding their proposed remote sensing space system "in sufficient detail to enable the Secretary to determine whether the proposal meets the requirements ofthe [Remote Sensing Act}"""" All ofthe information submited to NOAA as part of the licensing process becomes a part of the licensee‘s license to operate a remote sensing satelite system, and the Remote Sensing Act and NOAA‘s Regulations make it unlawful for a Hicensee to violate any provision of it lcense." It is clear, both ffom the above—cited, substantive requirements imposed in NOAA‘s Regulations and from DigitilGlobe‘s practical experience in going through the extensive Hicensing process—including the licensing of modifications to DigitalGlobe‘s space system— with NOAA, the Department of Defense, the Department of State, and the U.S. Intelligence 2 15 CFR Appendix 1 toPart960,Secion EV. e "isoregson 10

Community, that the process of obtaining and maintaining a license to operate a remote sensing satellite system is extraordinarily diffcutt The process is so exacting and the license requirements so detailed that DigitalGlobe believes NOAA‘s licensing policy alone provides a sufficient mechanism to preclude prospective remote sensing satellte operators from filing speculative license applications. There have been only thirteen (13) entities lcensed by NOAA to operate private remote sensing space systems in the thiteen (13) year existence of the legal regime to permit the operation of such systems. Of the 13 NOAA licensees, only approximately half have filed license applications with the FCC to operate their emote sensing satellites in the spectrum allocated for use by the Earth Exploration Satellite Service (‘EESS®). Further, of the 13 entites licensed by NOAA, only 4 have current remote sensing satelite operations. In the exercise of its role as the primary agency responsible for implementing U.S. remote sensing policy, NOAA is charged with ensuring that the systems it authorizes operate without causing unavoidable interference on the operations of the other Hicensed systems. NOAA will not authorize any prospective applicant to operate a remote sensing system, if the technical parameters provided by such prospective applicant will result in interfering with the operations of existing licensees, nor will NOAA authorize existing licensees to modify their systems in such a way as would cause interference on other existing licensees or prospective Hicensees who have applications before the agency. DigitalGlobe believes that the procedures associated with obtaining a license to operate a remote sensing space system from NOAA are so rigorous that there is no need for the Commission to impose bonds on remote satelite systems authorized by NOAA. The © on asie mater, DigtalGiobe nots thtthe Commission‘s Rtesdo not urenty explcidy prohbit nds tat are not already uthoried o operateremotesersing space systems by NOAA from obtaiinglcensee o perate 11

Commission‘s stted purpose for the bond is: (1) to provide an early mechanism for licensees to show the Commission that they are financially capsble of constructing and operating the authorized satelites; (2)to provide the Commission with an independent assessment regarding the financial wherewithal of the censee to construct and operate the satelltes; and (3) to prevent entities from "warchousing" scarce spectrum and orbital resources by not. constructing, Inunching, and operating in timely fushion. In light of the rigorous Hicensing requirements imposed by NOAA and the detailed review of the qualifications of prospective licensees to operate their remote sensing satelite systems in accordance with the national security interests of the United States by NOAA, the Department of Defense,the Department of State, and the U.S. Intelligence Community (among other interested agencies), DigitalGlobe contends that the bond requirementis unwarranted. Itis hard to imagine that NOAA, the Department of Defense, the Department of State, and the U.S Intelligence Community (not to mention the otherinterested agencies) would permit prospective applicants to obtain licensees when such Hicensees do not have a commitment to building their satellite systems. Even assuming the relevant agencies were to permit applicants to obtain "speculative Hicenses", it is clear from the Remote Sensing Act and NOAA‘s Regulations that NOAA could only authorize such applicant to obtain a liense if such grant was in the national security interest of the United States.. It is inconceivable that NOAA or any of the other relevant, iterested agencies would permit any licensees to "warchouse" spectrum or other "valuable" remote sensing satelite resources (e;2.orbital slot, etc) at the expense of cither existing, Hcensed remote sesing steltes in ESS bands DigtalGlobe srongy encourges the Commisson to amend is des t o provide. NOA isth Teadagency" wit regard o th repulaton fremot sesingstelte sytems in he Unted Stmes, bing direcly nvolved in coortinatng thjont use ofEESS spoctram by is censees. Thus t would be proper forthe Commission to requreprosectve EBSlcenees t otain NOAA lcensesprio to fing leenses with he Commission to use EESSlcated spectum. 12

remote sensing operators or future, viable remote sensing applicants. "Warehousing" spectrum or wasting other "valuable" remote sensing satelite resources is directly contrary tothe national securityinterests of the United States. It must follow, therefore, that NOAA, and the other interested agencies involved in reviewing remote sensing satelite applications, have already implemented a licensing system that precludes the warehousing of spectrum and ensures that only "qualified" applicants receive remote sensing satellte system authorizations. By requiring remote sensing satelite operators who are licensed by NOAA to post bonds to show that they are financially capable of constructing, launching, and operating remote sensing satelite systems, the Commission is implementing a regulatory regime that imposes a duplicative burden on remote sensing satelite operators. 2. DigitalGlobeis Committed to the U.S. Government to Construct, Lounch; and Operate Satellites that are Authorized by th which Eact is Conclusive igitalGlobe Financially Capable and itted to Building and Operating the Authorized Satellites As DigitalGlobe described in its Request for Determination of Compliance with Satelite Implementation: Milestoncs (‘Reques®") on October 24, 2005, DigitalGlobe has already commenced construction of the first satelite authorized by the Order, having completed, prior to the time of the Commission‘s grant of the Order, three (3) of the five (5) milestones set forth in the Order. As we instructed the Commission in our original application (SAT—MOD—20040728— 00151) and in the "Request for Determination of Compliance with Satellite Implementation Milestones", the funding of the construction of the newly authorized satelite is coming from both DigitalGiobe and the National Geospatial—Intelligence Ageney (‘NGA" with the terms of an agreement between DigitlGlobe and NGA called the NextView Agreement. 13

Under the NextView Agreement, NGA has agreed to fund fifty percent (50%) of the actual cost of DigitalGlobe‘s development and construction of the next—generation remote sensing satellite system, not to exceed a specified maximum amount, in exchange for DigitaIGlobe‘s agreement to operate that system oncelaunched and to provide data from it to NGA at favorable prices. Specifically, the following are some details related to the NextView Agreement from the NIMA (now NGA) press release announcing the awarding ofthe contract: The NextView award to DigitalGlobe is a contract with a potential to award more than $500 million over the period of performance of the contract. The contract allows NINA early participation in the development cyele for the next generation of U.S. commercial satellite inaging capabilities. NextView moves beyond the commodity—based approach of conmercial inagery acquisition and seeks to assure access, pricrity tasking rights, volume (area coverage) and broad licensing terms for sharing imagery with all potential mission partners. This contract will transform how NIMA provides geospatial intelligence by assuring availability of 0.5—meter conmercial imagery." Under the NextView Agreement with NGA, DigitalGlobe is obligated to meet certain detailed satelite. construction, launch, and operation. milestones: imposed. by: NGA." DigitalGiobe‘s obligations to the U.S. Government under the NextView Agreement are generally more extensive than the obligations stipulated in the Order in terms of the timeframes for constructing, launching and bringing the satellites into operation. ‘The only requirement in the Order that is not contained in the NextView Agreementis the bond requirement DigitalGiobe believes that the existence of the Agreement with NGA according to which DigitalGiobe has demonstrated its commitment to construct, Iaunch and operate the satelites " See NMA (tow NGA) Media Relese3—12, September 30 2003 * Unformnatel, DigtalGlob is no atibrtyto submita capy ohe NextView Contac, s there aresignificant porions of th NextView Contet thataeclassfed. n the event thatthe Commission desiresto undersand the fillnwure ofDigtalGiobe‘s contactal commitments t NGA underthe NexView Contact, we diect you o discusepmes ilient maters with Ms.Cyndi Wrighthe NextView Program Managerat NGA,at 301) 227—0048,or 14

suthorized by the Order in the frequencies allocated in the Order alone obviates the need for imposing a bond in the instant case. The Commission‘s stated purpose for the bond is: (1) to provide an early mechanism for licensees to show the Commission that they are financially capable of constructing and operating the authorized satelites; (2) to provide the Commission with an independent assessment regarding the financial wherewithal of the icensee to construct and operate the satelites; and (3) to prevent entities from "warchousing" scarce spectum and orbital resources by not constructing, launching, and operating in a timely fashion. Here, by entering into the NextView Agreement with NGA, DigitalGlobe committed itsef to the U.S. Government, in the interest of national security, to construct, launch, and operate the satelites that are authorized by the Order. NGA went through an extensive, competiive bid process in awarding the NextView Agreement to DigitelGlobe, according to which NGA has agreed to fund up to fifty percent (50%) of the construction cost of the next— generation remote sensing satelite system, not to exceed a specified. maximum amount.. In awarding the substantial NextView Agreement award to DigitalGlobe, after going through an extensive, competitive bid process, NGA determined that DigitalGlobe was finzncial capable of constructing the next—generation remote sensing system contemplated by the NextView Contract and embodied in the Order. As NGA has agreed to provide a significant cost share to DigitalGiobe under the NextView Agreement and NGA, an independent ageney from the FCC, has already determined that DigitilGlobe has the financial wherewithal to construct the remote sensing satellte system authorized by the Order, there is no need for the Commission to use the bond to prove DigitalGiobe‘s financial qualifications. Likewise, as DigitalGlobe has already completed three ofthfive milestones set forthin the Orderin fulfilment of its contractual obligations to NGA, 1s

there is no need for the Commission to use the bond as an "early" milestone. Finally, as DigitalGlobe is committed to the U.S. Government under the NextView Agreement to build the satelite system, using all of the spectrum allocated in the Order, there is no risk that DigitalGlobe has filed a speculative license application or that DigitalGlobe will *warchouse" the authorized bandwidth. Accordingly, DigitalGlobe contends that the bond is unnecessary.. As the facts of the present case are exceptionally unique and the Commission‘s grant of the instant Petiion would rely on and be specificallytalored to the facts presented, the Commission‘s grant of this petition will not undermine the policy objectives of the underlying bond requirement. Finally, the waiver of the bond requirement in the instant ease will facilitate the timeliness by which DigitalGlobe brings its remote sensing system into operation, as the waiver of the bond requirement will enable DigitalGlobe to use all of its resources in constructing, launching, and operating the authorized satellites. 3. The Warchousing of Spectrum and Orbital Resources by Remote Sensing Operators the Unit tes is ically Impossible Due A‘s Licensing Requirements, the Ability of the Band to Be Used by Multiple Users. and the Abundance of Orbital Locations Which e Operators can Operate their Systems As discussed in Section 11 C, 1., above, DigitalGlobe believes that the regulatory regime implemented by NOAA in regulating the activitesof remote sensing satelite lcensees has made it practically impossible for entitesto "warchouse" spectrum to the detriment of either existing or prospective, future remote sensing satelite operators. For, NOAA has developed a rigorous system to ensure that licensed operators use the applicable remote sensing frequencies (the EESS frequencies) without causing interference on other. licensed. operators (whether. presently authorized or to be authorized in the future). 16

In addition to the limitations on speculation and harmful warehousing provided for by NOAA‘s regulatory regime, DigitalGlobe notes that, from an astro—physics perspective, it is virtually inconceivable, considering the cutrent demand for remote sensing satelite imagery, that a well—coordinated spectral band could ever encounter a situation where either spectum or orbital positions could be "warehoused" or otherwise wasted by licensees authorized to operate NGSO sitelltes to the detriment of prospective, future NGSO remote sensing operators or currently authorized NGSO operators.. The very astro—physical characteristics associated with the "use" of orbital parameters by NGSO remote sensing satelites results in such orbital parameters being anything but "scarce." NGSO remote sensing satellite systems operate very differently from every other NGSO satelite system regulated by the FCC.. Although multiple remote sensing satelites are routinely suthorized by the Commission under single NGSO authorizations, remote sensing satellites do not operate as constellsions under any circumstances, That is, there is no interoperation between NGSO remote sensing satelltes authorized under single NGSO licenses, unlike the majority ofother NGSO satelltes. The Commission conceded in the Order, as well as in the ith Report and Order, that NGSO remote sensing satelltes are GSO—like with regard to the applicable procedures for reviewing and approving NGSO remote sensing satelite applications.** sas However, the Commission decided to treat NGSO remote sensing satelltes as NGSO constellations with regard to the bond requirement in the Order, without providing any explicit reasons therefor. The unique parameters associated with the operation of NGSO remote sensing satelite systems essentially results in a situation whereby neither bandwidth nor operational parameters 2 See. Order. FCC LEXIS 5427 (pans 4) " See, Flth Report and Order 19 PCC Red at 12664 (pan. 20. 17

are searce commodites, contrary to published conclusions ofthe Commission. In particulr, the Commission ruled in the Fifh Report and Order against excluding NGSO remote sensing satellite systems from the bond requirement because the Commission concluded that "granting an EESS license precludes other EESS licensees from using the same frequencies, orbits, and transmission times."*" In making this statement, we believe that the Commission did not fully appreciate the vast mumber of combinations of orbital. parameters: and. time—delimited transmission combinations that can be used by prospective remote. sensing operators to interoperate in EESS bands. The evidence is clear that there are ample, open orbital positions which NGSO remote sensing satellte operators can use to park their satellites.. In fact,the determining factor for choosing appropriate locations for NGSO remote sensing satelltes is nor the inclination angle of such satelites, but their altitudes. ‘The desized altitides for the satellites drive the determinations regarding the best inclination angles for NGSO remote sensing satelites. Moreover, it should be noted that as many as four (4)—and possibly more—NGSO remote sensing satelites can be placed in the same alttudes and inclination angles (down to tenth of degrecs) and operate without undue interference, providing that the 4 satelites are each phased 90 degrees apart from one another. In DigitilGlobe‘s application to modify ts NGSO remote sensing satelltesystem,in fact, DigitalGlobe requested the authorization to operate two NGSO remote sensing satelites at 97.2 degree inclination angles, with approximately 450—475 km altitudes, with the satelites phased at 0 degrees and 180 degrees in the orbit. ‘The other two authorized satellites meanwhile were authorized to operate at a 985 degree inclination angles, with approximately 770—795 km altitides, with such satelltes phased at0 degrees and 180 degrees in the orbit, as well. The same " Se, FIth Report and Order, t parsgaph 74. 18

inclination angles can handle a significant number of orbiting satellites, merely by varying the altitude of the given NGSO remote sensing satelltes slightly. As a result of the vast number of possible combinations of orbital parameters and time— delimited transmission combinations that can be used by prospective remote sensing operators to interoperate in EESS bands, t is clear that there is virtually no chance that a prospective remote sensing satellite operator will be able to harm other existing or prospective ESS licensees by failingto bring satellte systems into operation in "timely"fashion or otherwise "warehousing" orbital resources.. Furthermore, it is now a widely understood fact that EESS bands can be jointly used by all prospective remote sensing operators. Therefore, there is not a good public policy reason to impose a bond requirement on remote sensing satelite icensees. Accordingly, for the good cause demonstrated above, DigitalGlobe requests that the Commission reconsider its decision to impose a bond on DigitalGlobe in the Order. DigitalGiobe believes that in the instant case waiving the bond requirement as it applies to DigitalGiobe in the Order will not undermine the Commission‘s policy for requiring bonds for other licensed satellite systems.. Nevertheless, DigitalGlobe also believes that the Commission should reconsider its decision to require remote sensing satellte licensees to post bonds in general, in light of the stringent liensing review placed on prospective remote sensing satellite operations by NOAA (and other interested agencies),including the review of modifications to existing authorized operations. The fact that there are a vast number of possible combinations of orbital parameters and time—delimited transmission combinations that can be used by prospective remote sensing operators to iteroperate in EESS bands further mitigated against the imposition of bond requirements on remote sensing satellte licensees. Finally, it isin the public interest not 19

to impose a bond requirement on NOAAcJicensed remote sensing satellite operators, as the bond requirement results in duplicative regulatory requirements being imposed, which slow the timeliness by which remote sensing services are provided by licensees and used for the public‘s bene efiu ha In the Event the Commission Decides Not to Waive the Bond Requirement, th Commission Should Rule that: (a) NGSO Remote Sensing Satelltes are GSO—like: (b) the Appropriate Bond Amount is $3,000,000; (c) There are anly 4 Milestones for NGSO Remote Sensing Satellite Systems; and (d) an NGSO Remote Sensing System Licensee Will Fulfill The Milestone Requirement By Constructing. Lounching, And Bringing Into Operation The First SatellteIn Its NGSO Remote Sensing Sate Sustem As provided for in significant detail above, DigitalGlobe strongly believes that there is good cause to waive the bond requirement imposed in the Order due to the totality of cire umstances surrounding DigitalGlobe‘s construction, launch, and operation of its next— gen eration EESS satelite system.. Nevertheless,in the event that the Commission refuses to grant DigitalGlobe‘s request a waiver of the bond requirement in the instant case, DigitalGlobe requeststhat the Commission rule that (1) NGSO remote sensing satelltes are GSO—like for purposes of the bond requirement; (2) the appropriate bond for NGSO remote sensing satelite systems is $3,000,000; (3) there are only four milestones required for the construction of NGSO remote sensing satellite systems; and (4) an NGSO remote sensing system Hicensee will fulill the milestone requirement by constructing, launching, and bringing into operation the first satllitei its NGSO remote sensing satelite system. In the event that the Commission authorizes an NGSO remote sensing satellte operator in a license modification to operate new satelites using more bandwidth per satelite than

previously authorized, DigitalGlobe would accept a new $3,000,000 bond being imposed on the Hicensee—assuming that the Commission keeps the bond requirement for EESS sutellite Hicensees. However, DigitalGlobe requests that the Commission rule that the bond would be fultlled by the NGSO remote sensing system licensee launching and bringing into operation the first satelite using the additional bandwidth. Further, we request that the Commission rule that there would be no bond requirement for the construction, launch, and operation of additional NGSO remote sensing satellites authorized pursuant to satelite modification applications, as long as such satelites will operate only within aready—suthorized bandwidth. In making the present altemative request of the Commission, DigitalGlobe is essentially requesting that the Commission claify what DigitalGlobe believes to be the Commission‘s position with regard to the application of bond regquirements on NGSO EESS Hicensees. Specifically, in the Order, the Commission provided that the Commission had eliminated the financialrequirements then in place in the Commission‘s Rules and replaced them with the bond requirement* The Commission explained that DigitelGlobe must fle a bond because: (1) "remote sensing satellite operators are not exempt from the bond requirement in circumstances where they propose to operate a next—generation satelite system using additional frequencies for which they are not currently authorized‘"" and (2) DigitalGlobe had received authorization from the Commission to operate three new satelites in its NGSO remote sensing satellte system in frequencies not previousty authorized by the Commission."" Thus it appears that the Commission has provided that the bond will be imposed onlin instances where the Commission approves an NGSO EESS licensee to add satellites t ts system and any of the newly authorized satelites is authorized to use more spectrum than any of the * onter, PCCLEXIS 5427 (pan. 12). " Onter, ECC LEXTS 5427 (pan 13) seeasoFIthReportand Order, 19 FCC Red at 12659—12000 (pan. 8 ® Onler, FCC LEXIS 5427 (pan13) 21

Hicensec‘s existing authorized satelites. However, the Commission‘s decision in the Order is not entirely clear in the opinion of DigitalGlobe. Therefore, should the Commission refuse to waive the bond requirement in this instance, DigitalGlobe frst requests that the Commission clarify ts intent with regard to the imposition of the bond requirement on DigitalGlobe.. Moreover, as DigitalGiobe contends thatits satellite system is GSO—like, DigitalGlobe requests that the Commission clarify whether DigitalGlobe will be required to post a $3,000,000 bond as a GSOlike system. In addition, DigitalGlobe requeststhat the Commission further clarify whether a bond will be required in cases where a Hicensee requests the authority from the Commission to construct, launch, and operate new satellites in its NGSO satellite authorization, yet none of the satelites will operate in frequency bands broader than the licensee is already authorized to operate i. Along these lies, DigitalGlobe contends that only in the instance where a remote sensing operator requests the authority to expand the amount of bandwidth used by any ofthe satellites in its remote sensing system should a bond be imposed. Otherwise, the new satellites to be constricted, Isunched, and operated should be considered "replacement—like" satelites and no bond requirement imposed. As provided above, NGSO remote sensing satelite operate very differently than the vast majority of satelites icensed by the Commission, regardless of whether such satelites are GSO— like or NGSO—like in accordance with Commission rules.. As a result of the unique manner in which NGSO remote sensing satelites operate, there should be a different standard for liensing such satellites.. The Commission already conceded in the Order that NGSO remote sensing satellites are GSO—like for the purpose of the applicable licensing mechanism that is used to approve new NGSO remote sensing satelite lcenses. 22

The Commission should extend the concession that NGSO remote sensing satelites are GSO—like for processing round purposes to the bond requirement.. While DigitalGiobe desites for NGSO remote sensing satellites to be deemed "GSO—like" for purposes of the bond requirement, DigitalGlobe notes that NGSO remote sensing satellte systems are very distinct from GSO—like satellites. Accordingly, igitslGlobe contends that the Commission should ereate a special rule to accommodate NGSO remote sensing satelltes. As individual NGSO remote sensing satelltes operate independently ofthe other NGSO remote sensing satelltes that comprise the NGSO remote sensing satellte system, each satellte is trily GSO—like, as opposed to other NGSO systems which have been determined to be GSO— like for processing round purposes. In such cases, the entire NGSO constellation operates like a GSO satellite; therefore, the entire NGSO constellation is GSO—like. With regard to NGSO remote sensing satelites, however, each satelite will provide services independently ofthe other authorized satelites. As a result,there might be an inclination to require Hcensees to post a bond for each newly authorized satelite that will compriseits NGSO remote sensing system. For,if the Commission establishes that a bond is required only to construct,launch, and operate the first satelite authorized to operate in an NGSO remote sensing satellte system, satellite,the bond will not function to force or otheriise encourage the remote sensing satellie Hicensee to build,launch, or bring into operation the subsequent satelies authorized to operate in the same bandwidth. DigitalGlobe believes that NOAA already has sufficient measures in place to ensure that speculative licensing does not result in harm to existing or prospective future, remote sensing Hicensees. Therefore, DigitalGlobe believes that there is good cause to limit the extension ofthe bond requirement to remote sensing satellte licensees requesting the authority 23

to operate any single satelite in more bandwidth than its then—currently authorized satelltes are suthorized to operate in. V. Eratum DigitalGiobe hereby requests that the Commission issue a modified Order, oin ieu of a modified Order, an Eratum to address the following typographical error set forth in the Order. "The erzor is as follows: Paragraph 5 of the Order lists the Telemetry Downlink as being at 8030 MHz. This appears to be a typographical error, as Paragraphs 18 and 29 of the Order correetly refer to the downlink to be used by DigitalGiobe as being at 8380 MHz. Consequently, please strike " 8030 MHz" in Paragraph 5 and replace it with "#380 MHz". VI Conclusions For the good cause demonstrated herein, we urge the Commission to grant the request to waive the bond requirement in the instant case. & k k + 2

Should there be any questions regarding the foregoing information, please contact the undersigned at (703) 563—3090, x. 205 or DigitalGlobe‘s General Counsel, Ms. Bettina Eckerle, ar 303) cBt—4312. Respectfully submited, DromatGiose, Ivc. Keil J. Ritterpusch Mark J. Fickers Prerson & Rreterpuscn, LLP 2121 Cooperative Way, Suite 200 Hermdon, Virginia 20171 (703) 563—3090, x. 205 Counset to DrormatGtone,Inc. Bettine Eckerle General Counsel DitratGione, Inc. 1601 Dry Creek Drive Longmont, Colorado 80503 October 31, 2005 2s


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Document Modified: 2005-11-14 16:58:51
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