Intelsat and SES Will Get Paid for Airwaves, FCC Member Says
Intelsat and SES Will Get Paid for Airwaves, FCC Member Says
(Bloomberg) -- Satellite providers Intelsat SA and SES SA will get paid for yielding airwaves for 5G use, although the amount is yet to be determined, Federal Communications Commission member Jessica Rosenworcel said.
“They’re going to be compensated in some way,” Rosenworcel, one of five FCC commissioners, said in an interview with Bloomberg News Thursday. “It has to be an incentive that makes them return the maximum amount of airwaves.”
FCC Chairman Ajit Pai has rejected the satellite providers’ proposal to sell some of their airwaves in a private auction. Instead, Pai on Nov. 18 proposed a public auction -- a course that could reduce the companies’ share of the proceeds by billions of dollars. Intelsat and SES shares plunged.
After Bloomberg reported Rosenworcel’s comments, Intelsat erased losses in New York trading after the remarks, gaining 1.5% as of 2:24 p.m. Intelsat bonds also pared some of their earlier losses. Its 9.5% bonds due February 2023 traded at 61.875 cents on the dollar at 2:12 p.m. in New York, up from an intraday low of 59 cents. The company’s bonds have fallen over the past two weeks amid uncertainty about the outcome of the C-Band auction.
Rosenworcel, the top Democrat on the Republican-majority agency, said she backs a public auction. She said the FCC has run such sales for more than 20 years and raised more than $114 billion for taxpayers, “so maybe we should figure out how to make those processes work better, rather than just retreat to a private sale.”
The FCC could vote on adopting Pai’s plan early next year. Rosenworcel said possibilities for spending money raised by the airwaves sale include rural broadband and Wi-Fi hotspots in libraries to help students who lack home internet service.
“Congress has a lot of thoughts about just how we manage that, that spectrum band, and I think the FCC is gonna have to spend some time looking over that and figuring out how to proceed,” Rosenworcel said.
--With assistance from Allison McNeely.
To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net
To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth Wasserman
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