U.S. President-elect Donald Trump’s objectives for his first 100 days include shaping trade policy, boosting investment in U.S. infrastructure, and expanding military investment. While space is not specifically mentioned in these plans, actions taken in the early days of the new administration will very likely have an impact on the industry further down the line.
The satellite telecommunications industry also has hopes for what the Trump administration will do once it focuses on this sector.
Based on interviews with several industry officials, SpaceNews compiled the top four wants the satellite industry has for the next four years.
1. Restoration of Ex-Im Bank
Congress reauthorized the Export-Import Bank of the United States’ charter in December 2015 following a five-month lapse during which it couldn’t issue new loans. However, the export credit agency still isn’t in a position to finance new satellite deals. That’s because three of the five seats on its board of directors are currently vacant. Without a quorum, Ex-Im cannot vote to approve new deals valued at more than $10 million.
“U.S. competitiveness should be highlighted in the form of a full board of directors at the Ex-Im Bank,” said David Logsdon, executive director of the CompTIA Space Enterprise Council, a Washington trade group representing companies involved in commercial, civil and national security space.
The Ex-Im Bank needs only one additional board member to meet the required three-member quorum for approving new, big-ticket deals. Senate Banking Committee Chairman Richard Shelby (R-Ala.), who opposes export-credit financing as a form of corporate welfare, has been blocking Obama administration nominee Mark McWatters, a former staffer for the Republican-led House Financial Services Committee, since January. Shelby, who was re-elected Nov. 8 to a sixth term in the Senate, could continue to be a roadblock under Trump.
The satellite industry, however, hopes the Trump administration, with its promise to promote domestic manufacturing, will find a way around Shelby and restore the bank’s ability to support satellite and launch projects.
“Supporting a full board of directors at the Export-Import Bank would put U.S. manufacturers on more-even ground, giving [customer from] other nations access to upfront satellite costs that would be built in the U.S.,” said Tom Stroup, president of the Satellite Industry Association, which advocates on behalf of U.S. satellite operators, service providers and their suppliers
According to the Aerospace Industries Association — the Arlington, Virginia-based trade group representing roughly 300 major aerospace and defense companies and their suppliers — the Ex-Im Bank provided more than $900 million in financing to the satellite and launch sectors in 2014.
“That has completely gone away,” said Frank Slazer, AIA’s vice president of space systems.
Slazer said critics of Ex-Im often refer to export credit financing as a dilution of free-market principles. However, other nations, notably France and China have export credit agencies of their own that continue to finance satellite projects.
Canada-based MDA Corp. has also leveraged its home country in order to use Export Development Canada for support of its U.S.-based manufacturer Space Systems Loral. Multiple satellite orders with U.S. manufacturers remain stalled, with manufacturers citing the lack of export-credit-agency funding as the principal reason.
“It’s a small industrial base,” said Slazer. “We are not talking about the automotive industry; these are serious sales and serious impacts. Also, Ex-Im makes money. It’s been a contributor to the bottom line for the U.S. government. If people want to get rid of export financing’s impact on the economy, we should come up with a treaty and get rid of them around the world, not unilaterally disarm. That’s just crazy.”
2. More ITAR Reform
The satellite industry wants still-looser regulations when it comes to exporting space-related technologies to other countries. Industry has regularly complained that widely available technologies are still being classified as weaponry under the United States Munitions List, even though other countries have long since developed the ability to produce the same items on their own.
Reforms to the International Traffic in Arms Regulations (ITAR), which dictate what can and cannot be sold to other nations, eased the rules for 36 countries in 2014, but the effects of ITAR remain strongly felt in the U.S. and around the world.
“The satellite industry needs regulatory agility — predictable and supportive regulations and licensing that encourage growth of the U.S. satellite industry and attracts investment in new technologies and applications — all the while ensuring space is a safe and secure environment in which to operate,” said SIA’s Stroup.
AIA’s Slazer pointed to electric-propulsion systems as an example of a technology that once seemed appropriate to have on ITAR, but no longer deserves such treatment.
“Back in 1998, that was cutting edge. But now it’s available globally commercially. It makes no sense to have that classified as weapons-related,” he said.
Slazer said it has been almost two-and-a-half years since AIA submitted a list of ITAR-blacklisted technologies for reevaluation. The Obama administration could still evaluate these claims before Obama leaves office Jan. 20. If it doesn’t, further ITAR reform will be up to the Trump administration.
3. Save Spectrum for Satellites
Federal Communications Commission Chairman Tom Wheeler, who told the satellite industry last winter to get used to the idea of sharing Ka-band spectrum with future terrestrial wireless providers, didn’t exactly smooth things over this summer when he warned the industry not to publicly criticize the FCC’s decision to open up some of that spectrum to 5G services.
Wheeler, a Senate-confirmed Obama appointee holding an especially plum position, is almost certain to be replaced when Trump comes to town.
David Hartshorn, secretary general of the London- and Washington-based Global VSAT Forum, said the incoming Trump administration should know the satellite industry wants to bury the hatchet from last year’s World Radiocommunication Conference (WRC-15), where the wireless and satellite industries fought fiercely over spectrum rights.
“We’ve said this many times before, and now we will need to say it again to the Trump administration: it is not our intent to detract from the success of the wireless industry. On the contrary, they are one of our most important users, and we look forward to working as partners to enable the broader introduction of 5G through, among other means, satellite backhaul,” said Hartshorn.
Wheeler’s blunt comments to the satellite industry in March that it would be “far more practical to get on the [5G] train than to be run over by it,” were made in response to the satellite industry’s oppositional stance at WRC-15. Aarti Holla-Maini, secretary general of the EMEA Satellite Operators Association — a Brussels-based trade group representing operators in Europe, the Middle East and Africa — said it is important to see how commissioners at the FCC will treat satellite businesses in the future. Current ongoing matters, such as the Spectrum Frontiers Notice of Proposed Rule-Making, which could cede satellite industry spectrum to mobile network operators for the upcoming 5G standard, will unfold during Trump’s four-year term.
“So far, the U.S. has decided to go its own path and identify for 5G frequency bands that the [International Telecommunication Union] made clear were not available for such purposes on a worldwide basis,” said Holla-Maini. “How the incoming Trump administration will decide to proceed in its preparation towards WRC-19 on the selection of 5G bands will be of great interest to the satellite industry.”
4. Don’t Forget about the Satellite Industry
That the Trump administration simply remembers the satellite industry outside of just military or civil space applications is essential to making sure all other policy objectives don’t fall by the wayside, industry representatives said.
Along with access to export credit, further export reform and enough spectrum to do business, industry representatives said satellite communications providers also want to be assured a seat at the table when the Trump administration makes plans to address U.S. telecom needs.
“Under the Trump administration, there is bound to be a large infrastructure stimulus package,” said the CompTIA Space Enterprise Council’s Logsdon. “Broadband connectivity provided to the infrastructure industries in the remote [and] rural areas will be essential. Much of that connectivity can be provided by the satellite industry. It will be essential that the Trump administration capitalizes on the unique attributes of satellite broadband connectivity.”
Holla-Maini of the EMEA Satellite Operators Association said the worldwide satellite industry will also be watching for how much emphasis is put on international collaboration, given the global nature of satellite technology.
“We look forward to working with the Trump administration on implementing policies that are technology neutral, advance connectivity to the entire nation, and results in innovative, high-quality broadband services as well as the supporting the future growth of the U.S. space industry sector,” she said.