Finding Balance in LEO Satellite Rules

By Michael O’Rielly

Many people who have followed my career know all too well that I appreciate the deep-in-the-weeds of policy matters, and few substantive issues capture that as well as the launch and operations of satellite constellations.  Making these systems a reality generally requires exorbitant entrepreneurialism while adhering to thorny and complex public policy.  Existing domestic satellite rules and regulations governed by the Federal Communications Commission (FCC or the Commission) have proven outdated to sufficiently respond to the dynamism happening in many parts of the satellite industry.  You don’t have to take my word for it, as the same opinion has been shared by those on Capitol Hill, within the Commission itself, and elsewhere. 

Consider the impact of the massive interest in Low Earth Orbit (LEOs) Satellites (a subset of NGSO FSS systems) to deliver Internet broadband to American families and around the globe.  This development has essentially forced a reconsideration of the traditional processing round regime and how satellite spectrum bands are shared among competing constellations.  In 2016, the FCC opened up a processing round in which 12 applicants filed to deploy LEO constellations.  As is not unusual for complex satellite projects, most either did not build or returned their licenses, but a handful did move forward to deploy new broadband systems.  In 2020 the FCC opened a second processing round and found more interest from both new and existing licensees, with a total of 10 applicants filing. Responsibly, the Commission opened a proceeding last year to explore, in part, crucial satellite spectrum sharing issues raised by the plethora of proposed LEO system applications filed over the recent years. 

This topic was the subject of an October event by New America, which I was pleased to attend.  With insightful opening statements by Commissioners Starks and Simington, the real eye-opening portion of the event was a subsequent expert panel.  Comprised of an academic, public interest advocate, and two satellite company representatives (SpaceX and Amazon’s Kuiper), panelists debated various aspects of the FCC’s proceeding.  Perhaps most interesting, especially to policy wonks, was the discussion of a how best to ensure competition in the LEO marketplace and defining appropriate protections for all LEO applicants. 

FCC Satellite Oversight and Regulatory Functions

Fundamentally, the Commission conducts two main regulatory functions with regards to satellite applicants.  As duly outlined in the NPRM, the Commission considers whether applicants are “legally, technically, and otherwise qualified, that the proposed facilities and operations comply with all applicable rules, regulations, and policies, and that grant of the application will serve the public interest, convenience and necessity.”  That is, it seeks to ensure that eventual licensees are capable and willing to comply with FCC rules and regulations and whether granting of the license benefits the public interest.  It’s the process by which the Commission separates the serious and committed from the dreamers and incapable. 

Equally important, and oftentimes more complicated, is the process for crafting the rules for use of spectrum bands allocated for satellite services.  Specifically, the Commission has for decades opened what is known as “processing rounds” whereby applicants within a certain window of time can seek to use identified spectrum bands to offer a particular satellite service.  Licensing systems periodically in large groups, rather than one at a time, reduces the pressure to be “first to file”—theoretically, resulting in less gamesmanship and a smaller pool of sincere applications. All applicants understood that the spectrum would be shared and that new applicants and processing rounds would come in the future.   

The burst of interest in LEOs and rapid innovation over the last many years, however, essentially fractured this regime.  With multiple new applicants filing constellation proposals, and existing licensees filing both new applications as well as significant modifications to their earlier filed systems, the Commission’s processing round structure became strained.  No sooner had the first round been almost set when the Commission and the prospective industry were already discussing another round.  Rather than extend the timing of a pending round, the Commission decided to move forward with distinct multiple rounds.  In some respects, processing rounds also assume that LEO systems have fixed and stable plans, historically true but not in the modern age. Today, technology and plans evolve rapidly, and earlier-licensed systems are modifying their systems even as the FCC is licensing systems in later processing rounds. 

But the messiness of the processing rounds meant that key decisions were deferred until a later date.  One major example is that central to the processing round framework is the idea that earlier processing rounds are protected against harmful interference from later-licensed systems.  But the Commission never explicitly defined what that level of protection is.  That is effectively where the Commission’s December 2021 item becomes so important to the discussion.  In that item, the agency seeks to investigate, digest, and determine the proper interference protections that should be given to systems from within a processing round and from different rounds.  The important goal the Commission established for this rulemaking was that the future rules must be pro-competitive and drive innovation, while still providing earlier processing round systems with a reasonable level of protection for their investment backed expectations.

The justification for this line of inquiry is laudable.  Historically and here as well, the Commission is attempting to balance the need to protect investments made by early applicants with the desire to preserve a competitive market and innovation to be brought forth by new entrants.  In other words, how do we evaluate potential interference from new systems, and what happens when that interference threshold is exceeded?  And how does this balance with the expectations of the satellite industry and other participants?  Further, even for systems licensed in later processing rounds—the best and first resort is coordination among operators, rather than defaulting to the less efficient rules for settling interference disputes. But how can the rules incentivize all parties to seek coordination agreements?

From my outsider perspective, the receptivity of the Commission to alternative ways to benchmark for harmful interference, and the accumulated record, is notable.  At minimum, the agency seems to take a neutral approach to finding the appropriate standard.  And the record reflects this as well, as some parties seek to continue an existing measurement of interference-to-noise (commonly referred to as I/N) which is a static approach that does not actually even look at whether the customer is impacted; others advocate for an uneven splitting of spectrum between earlier-round and later round systems; and the Commission spends considerable time and attention to tee-up what is known as degraded throughput. But it also appears that the agency goes one step further to reject the use of petitioner’s suggested solution, I/N.  Had it wanted to bless this in some form, it could have easily adopted it as a tentative conclusion. 

Degraded Throughput: A Better Interference Metric?   

Even for someone who appreciates the meaty substance, the discussion of potential interference metrics is extremely complex.  At its heart, however, is the basic premise that the Commission should adopt a standard that is based on the best available science.  The good news is that modern technologies allow for more nuance in measuring and responding to interference concerns among NGSOs.  The agency’s record highlights the differences between the interference-to-noise approach and one centered on degraded throughput. 

The comments submitted in the proceeding seem to demonstrate that I/N doesn’t provide an analysis to calculate interference that actually harms customers.  Instead, it looks to be a static threshold that can both overprotect and under-protect the very systems it is supposed to be designed to help.  The Commission’s NPRM cites comments from various providers that “the I/N limit would reflect generic NGSO system parameters and not the parameters of the NGSO system to be protected, it could provide insufficient protection to an NGSO system with especially sensitive antennas.” 

Alternatively, a degraded throughput methodology compares an actual existing satellite system’s expected and designed-for baseline performance against the expected performance of the system encountering the presence of a new system.  While an I/N threshold simply sets a static threshold, the degraded throughput methodology considers how interference affects the expected performance of the system: the output that actually affects service to customers and the metric satellite operators actually care about. 

Looking at the impact of performance requires a deeper consideration of how a system operates to take into account elements like how a satellite system’s capacity to transmit data might already be affected by factors like rain, orbital nuances, or interference from other systems.  Even without interference from new systems, existing systems must already manage these challenges, and so are equipped to do so with technologies like adaptive coding and modulation.  A degraded throughput analysis looks to take these system design choices into account to arrive at a much more accurate representation of interference caused by a new entrant and the protections necessary for existing satellite offerings in a band.  The result is simply a more precise and proper reflection of interference caused by a new entrant.  This more careful calculation of finding interference that actually harms customers is critical for creating the spectrum availability for new and old systems to thrive together.

Apart from being more accurate and fairer, this approach seems to intuitively make sense:  Why would we ignore how modern NGSO systems operate in the real world, or disregard a tool ready made to measure impact on their actual performance?  That seems nonsensical. 

Critics argue that degraded throughout is just not ripe for consideration or that it is only being advocated for by a few.  In Commission parlance, those are traditionally empty claims when opponents are out of compelling arguments.  Degraded throughput is a mathematical calculation based on certain assumption – just as I/N.  Pushing off tough policy issues to another day doesn’t resolve key issues that all satellite participants have been seeking since the announcement of the first LEO processing.  It’s also antithetical to the Commission norms: the agency and its staff do the hard work.  To the extent there are only a few advocates for a policy position, that’s neither a rarity nor a problem.  The Commission doesn’t operate by popular opinion or counting heads.  Instead, it focuses on the merit of the arguments and substance presented.

Satellite Policy Fundamentals

No matter where any party is on the interference metric, it is important to take a slight step back to reflect upon the issue from a larger context.  At its heart, protections from interference are really about ensuring that spectrum allocated to satellite is used as efficiently as possible.  The more efficiently spectrum is used, the more satellite systems can operate, and the more customers can get the high-quality broadband that these exciting systems will bring. While the Commission could limit satellite entry to only one provider per service (and related bands), doing so would have drawbacks for spectral efficiency, innovation, and a competitive marketplace. 

Anyone working on spectrum policy in the last many decades realizes that spectrum is at a premium.  Existing services, be it government or commercial offerings, are constantly being examined to determine if a band can be reallocated or shared with a new service.  Spectrum designated for satellite services is no different.  This means that every existing spectrum band must be used as efficiently as possible – or risk that the Commission decides to do something else with it.  Allowing multiple LEO providers to share the same bands promotes a more defensible spectrum policy.  Undeniably, degraded throughput provides an opportunity for additional satellite providers to operate within the same bands. 

Even if there was not a spectrum crunch, promoting multiple satellite systems is in the best interest of both American national security and American consumers.  Specifically, allowing more satellite entrants ultimately means added competition.  Time and time again in the communications arena, we have seen the benefits of competition, which tends to lead to healthy battles to obtain consumers, the development of new innovative services, better consumer pricing, and expanded market growth.  We also know from experience that first to the market does not always lead to provider longevity or market security.  If it did, we would all be still using AOL for Internet Access and email, MySpace for social media, AT&T for long distance service, or countless other expired offerings.  Maybe even more importantly, American leadership in space technology requires this competition between many American innovative space companies.  Satellite technology, including broadband LEO systems are already delivering in critical places around the world to maintain American leadership, and our adversaries are already aggressively working to narrow the gap.  While they select national champions or use government owned entities, America wins with our vibrant private sector competing and innovation.  Thus, the soundest communications policy has proven to be ones that do not artificially limit new entrants or impose unnecessary protections for incumbents.   

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I have been particularly impressed by this Commission’s attention to important satellite matters.   With solid leadership, the agency recognizes the valuable offerings satellites can bring to the communications marketplace and, more importantly, consumers.  It has also recognized the need to update its regulatory structure to reflect better information and practices (and Congress is working on this too).  Adopting a new interference protection metric more accurately determines and sets protections for an incumbent satellite system’s harmful interference to only that actually caused by a new entrant.  And in doing so, more satellite systems would be able to flourish for consumer use.