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Satellite operators successfully conclude C-band clearance; expects $9 billion relocation payment

In the early hours of Thursday, a SpaceX Falcon 9 rocket successfully launched the last of a dozen new C-band video relay satellites purchased by Intelsat and SES to help clear spectrum for the rollout of 5G wireless services in the United States.

Satellite operators, including Eutelsat, Intelsat, SES, Star One, and Telesat have been tasked by the FCC to clear the lower 300MHz of C-band spectrum throughout the continental US by December.

This came up as U.S. wireless and mobile network operators invested billions in recent years to ready their networks for 5G.

This came up as U.S. wireless and mobile network operators invested billions in recent years to ready their networks for 5G. According to wireless industry players, the mid band spectrum between 2-6 GHz could provides a longer range than the high-band, with good speeds in the gigabit per second range. C-band is part of the mid-band spectrum and is really the perfect spectrum to enable new 5G use cases.

After investing more than $121 billion since 2018 into infrastructure upgrades and modernization projects, operators continue to position to acquire as much spectrum as possible for delivery of new services and for consumer and enterprise applications.

On June 1, 2020, US Federal Communications Commission Chairman Ajit Pai
announced that the repurposing of C-band spectrum for 5G services will move forward on an accelerated timeline. In a public notice released today, the FCC’s Wireless
Telecommunications Bureau said it had secured commitments from all eligible satellite
operators to meet an accelerated clearing timeline that will make way for faster 5G deployment in the 3.7 GHz band, also called the C-band.

According to the directive, the FCC has earmarked 280 MHz of bandwidth, instead of the originally expected 180 MHz, to be auctioned for mobile network operators. This leaves less than half of the spectrum, about 200 MHz, to be preserved for TV programming. Moreover, the FCC’s announcement of a USD 9.7 billion payout to satellite companies ahead of the 5G auction has introduced further confusion to an already uncertain landscape.

The stakes were extremely high. Failure to execute could significantly damage relationships with customers and disrupt their business operations. An inability to meet deadlines would mean not only missing out on incentive opportunities but also losing the spectrum altogether. Cost implications were enormous as well. The FCC offered reimbursement for this very expensive endeavor, but every dollar spent had to be documented via a painstaking process with photos and work orders vetted through third-party clearinghouses and attorneys.

Intelsat and SES, two of the world’s largest geostationary communications satellites operators, are on track to receive nearly $9 billion in incentive payments from 5G cell network operators by the end of the year. The payments are due after Intelsat and SES clear the lower 300 MHz of C-band spectrum, which is being transitioned from satellite services to terrestrial 5G under the supervision of the Federal Communications Commission.

Intelsat was the largest holder of C-band licenses and migrating its share of the spectrum meant squeezing 60 percent of its capacity used mostly by broadcasters into the remaining 40 percent. At the same time, the company had to protect incumbent earth stations pointed at its satellites. For this massive undertaking, the FCC offered incentives to operators capable of meeting accelerated timelines.

In order to enable the 5G transition, Intelsat and SES purchased new satellites in 2020 designed to operate in a different portion of the C-band spectrum. Although the communications satellite industry is shifting to focus on Internet connectivity—a trend highlighted by new mega-constellations like SpaceX’s Starlink—there’s still a substantial market for traditional C-band services, primarily for cable television and video distribution that reach more than 100 million homes and businesses across North America.

The U.S. Federal Communications Commission (FCC) has carefully developed a plan to clear 280 MHz of C-band spectrum (plus a 20-MHz guard band) for 5G mobile services in the contiguous United States (CONUS) as early as December 2023, with a portion of that spectrum becoming available as early as December 2021.

The FCC’s balanced approach will ensure that C-band spectrum is available quickly without disrupting critical video and audio services.

On June 29, 2022, the SES-22 satellite, built by Thales Alenia Space, was successfully launched into space onboard a SpaceX Falcon 9 rocket. SES-22, the first of SES’s C-band satellites dedicated to freeing up the lower 300 MHz of C-band spectrum, will operate in the 135 degrees West orbital slot. It will deliver TV and radio to millions of American homes and provide other critical data transmission services.

The agreement between satellite operators, 5G service providers, and the FCC set up a framework to pay Intelsat and SES incentives if they fully transitioned off the lower 300 MHz of C-band spectrum by December 2023, two years before the FCC’s mandated deadline.

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