WEDNESDAY, 11.00AM
THE United States Federal Communications Commission on Tuesday gave the green light to an ambitious billion-dollar global satellite telephone network which is heavily dependent on a $350-million pledge by SA black empowerment group Vula Communications.
The FCC granted Washington-based Mobile Communications Holdings Inc a licence to launch its 16 Ellipso satellites, which will give it a global, space-based cellular system which it claims will bring affordable communications to the people of Africa and other developing regions.
Vula committed the $350-million, which has to be paid over two years, to secure exclusive marketing and service rights to the network in sub-Saharan Africa.
The FCC decision, vigorously resisted by Mobile’s already licensed and well-capitalised competition, was unusual in that it waived its usual financial requirements. The FCC said Mobile “has not shown that Vula is capable of paying $350-million for regional distribution rights”. The waiver was granted in the face of opposition from Mobile’s rivals and after lobbying on Mobile’s behalf by the Congressional Black Caucus.
The FCC granted the licence because Mobile’s system design and marketing strategy were sufficiently distinctive that “affording Mobile the chance to carry out its proposal might therefore result in significant enhancement of commercial competition to the benefit of consumers”.