Date Issued: 
January 1, 1986

Evan Kwerel and James McNally.  

OSP Working Paper 19 (Jan 1986) argues that the FCC’s regulatory policies have prevented competition between international satellite and cable facilities.  Instead of letting AT&T freely choose between cables and satellites, the FCC has required AT&T to send a share of its international traffic on satellite circuits leased from the Communication Satellite Corporation (Comsat).

The authors argue that, although this policy may have served some historical purposes -- such as fostering the establishment of a worldwide satellite system -- there is little justification for its continuation.  They conclude that FCC policy should focus on the cost and pricing of international facilities and not on the allocation of profits among U.S. firms.