- The FCC dismissed SpaceX’s petition to operate satellites in spectrum it isn’t authorized to use
- However, the agency indicated its support for SpaceX’s purchase of EchoStar’s 2 GHz spectrum
- More broadly, the decision reinforces the exclusive spectrum rights of incumbent players like Iridium and Globalstar
The Federal Communications Commission (FCC) on Thursday denied requests by multiple satellite companies – including SpaceX – for access to spectrum, saying it’s all about enabling the direct-to-device (D2D) market to flourish.
Our first reaction was: Huh? How does denying satellite companies access to spectrum encourage them to compete in the D2D space?
Turns out, it’s actually providing regulatory certainty in a very uncertain but highly hyped industry. Billions of dollars are being invested in D2D when it’s not entirely clear how much consumers or enterprises are going to spend on getting satellite connectivity direct to their smartphones.
“This new FCC order is super complicated, but basically is telling everyone to stay in their lane,” said satellite industry analyst Tim Farrar, principal of TMF Associates.
In other words, by dismissing multiple filings that were submitted to the commission, it’s reaffirming existing licensees’ exclusive rights to use certain D2D spectrum bands by rejecting several companies’ requests to enter those same bands.
“By preserving the regulatory certainty necessary for long-term investment in D2D, the FCC is setting the stage for ubiquitous connectivity, the end of coverage gaps and more robust IoT,” the FCC stated.
Winners and losers
SpaceX had argued for sharing in the 1610-1617.775 and 2483.5-2500 MHz bands, aka the “Big LEO” bands, but the FCC didn’t go for that.
“Obviously, SpaceX loses something, but it gets a lot of protection for what they want to do with 2 GHz. What AST SpaceMobile is getting is some level of encouragement for Ligado,” Farrar said. “Amazon and Apple are going to be protected in the Big LEO band.”
CCS Insight analyst Luke Pearce said incumbent mobile satellite services (MSS) spectrum holders Iridium and Globalstar (soon to be under Amazon Leo ownership) are winners here, as the FCC’s decision reinforces their exclusive rights and removes uncertainty about potential sharing.
Newer or smaller entrants like Kepler and Sateliot, whose business cases partly depended on gaining access to MSS spectrum, are in the losers’ circle. “This raises barriers to entry and could make funding and scaling more challenging for them or any future would-be entrants,” Pearce said.
In sum, the FCC’s order essentially supports what FCC Chairman Brendan Carr said on CNBC last week, which is they want to see at least three facilities-based providers in the satellite D2D space. “This is really creating that formulation,” Farrar said.