by Gerry Oberst

This past July, the European Commission (EC) sponsored a plenary meeting in Brussels regarding the longstanding EC Satellite Action Plan (SAP). The EC initiated the SAP in 1996 as a platform for debate on satellite topics. The main discussion during this session focused on meeting European goals in the information society realm.

Even though this was a somewhat smaller plenary than in past years, the 50 participants included key players who emphasized the contributions of the satellite sector to broadband deployment and made pleas for public-private partnerships to help fund additional efforts.

Eight CEOs from major satellite companies operating in Europe attended a pre-meeting discussion to share views with EC officials. In the plenary these and other speakers divided into three sessions, focusing on the role satellites can play as an integral part of an infrastructure for broadband services, implementation of the new European regulatory framework and R&D issues facing the satellite sector.

Five CEOs in the first session described the impact of satellite networks on broadband. They all pledged that satellite technology must be an integral part of the eEurope 2005 Action Plan, designed to bring new services to all Europeans. Growth in 2002 was recognized as disappointing for some operators, but speakers emphasized that momentum is gaining in 2003.

Identifying the institutional requirements for broadband applications and aggregating that demand into a coherent approach is one leading role participants urged the EC to take. This strategy may pose a challenge because some European funding is directed to piecemeal applications, with a fiber line here or a wireless access transmitter there, to meet the needs of individual communities versus the greater efficiency of a satellite solution for pan-European applications. Thus, the speakers called on the Commission to help outline the demand for satellite applications that would "leverage industrial capabilities and capacity," with the goal of bringing down the cost of satellite user terminals.

In addition, one presentation referred to bridge financing, while another referred to pure guarantees. These speakers were targeting their comments to the European Investment Bank (EIB), the Luxembourg-based specialized institution set up to finance European Union (EU) projects.

The final speaker of that session, who was from the EIB, said that if satellite companies want government money, they must deliver good arguments. Due to the EIB’s broad purpose, the satellite sector is competing with an enormous number of other projects and sectors for funding in these difficult economic times.

This message, however, does not shut the door on supporting satellite initiatives. The EIB has funded more than 75 billion Euros (U.S. $66 billion) for European networks throughout the last decade, as well as 16 billion Euros for telecoms (U.S. $14 billion) and $3 billion Euros for satellite ventures (U.S. $2.65 billion). Moreover, there is the recent model of the public-private partnership established to fund the Galileo satellite positioning system, Europe’s answer to the U.S. GPS system. Nevertheless, the message was fairly clear that this is not an automatic idea and flying the flag of broadband will not necessarily open doors to government funding.

For all that, the plenary served the useful purpose of showing a united satellite industry resolve to target new applications at broadband services. Even the final session on R&D emphasized new programs aimed at such services. The European Satellite Operators Association (ESOA) stressed government programs and pilot projects had to focus more strongly on deployment issues.

The second session of the plenary focused on the ever-present regulatory details of the satellite sector. The broadband theme continued with recognition that the industry association needed to ensure that European governments take into account the contributions of the satellite industry. Another theme centered on seeking simplified licensing systems and avoiding new fee structures. The Global VSAT Forum distilled its discussion of regulatory trends toward streamlined licensing and national reform, also showing how European regulatory models have been helpful in other regions of the world for satellite solutions.

At an influential summit of the European Council held in Lisbon, Portugal, in early 2000, the EU set a goal "to become the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion." In one way or another, virtually every speaker at the Brussels SAP Plenary this past July emphasized the ways in which the satellite industry will contribute to that goal.

Gerry Oberst is a partner in the Brussels office of the Hogan & Hartson law firm. His email address is [email protected].