EXPORT CONTROLS COST U.S. SATELLITE COMPANIES MONEY AND JOBS
Strict satellite export controls cost U.S. commercial satellite manufacturers revenue, jobs and market share in 2000, according to survey released by Satellite Industry Assn. (SIA) Tues. Survey concentrated on Cal., home of 4 largest satellite manufacturers in U.S., including Space Systems/Loral and Boeing. Study said manufacturers building telecom satellites lost $1.2 billion in contracts and more than 1,000 jobs in year as result of controls. U.S. companies lost 30% of global market share, dropping to 45% with 13 new orders for U.S.-built geostationary satellites vs. 16 new orders for European-built birds.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
Since Congress in 1999 shifted control over satellite export licensing to State Dept. from Commerce Dept., State set tough regulations to protect national security rather than promote commercial sales, SIA Exec. Dir. Clayton Mowry said. SIA and U.S. manufacturers have been lobbying Congress to ease regulations (CD Nov 24 p3). State Dept. treats satellites as weapons, meaning they're subject to weapons-related sanctions. Some foreign companies have complained export rules were stumbling block in getting deals done (CD Nov 15 p4). For example, U.S. satellite manufacturers can’t allow foreign companies to monitor progress while satellites are being built, Mowry said. “In order for us to push forward, we've had to go in with a little bit of a blind eye,” AsiaSat Deputy CEO William Wade said of company’s contract with Boeing to build 3 AsiaSat4s. “Regulatory restrictions have made it more difficult to provide information in a timely manner to our current customers, prospective customers and insurance underwriters,” Lockheed Martin spokesman said.
Confusing rules as to what information U.S. companies could share cost money, time and confusion, industry source said. “When the rules changed and gave the responsibility back to State from Commerce, there was a significant shift and it took time for the State Dept. to get their heads around,” source told us. Companies reported spending 4-5 times as much time and resources to comply with State’s export control procedures.
Results “show that the U.S. commercial satellite manufacturing industry is in serious danger of losing its leadership position in the global marketplace,” Mowry told congressional briefing Tues. He told us loss of business wasn’t entirely because of controls, but they were “clearly having an impact on U.S. companies’ ability to do business.”