Summary: At the initiative of the United States, the International Telecommunications Satellite Organization (INTELSAT) was created in 1964 to provide telephone and data services. The International Maritime Satellite Organization was formed in 1979 to provide maritime communications. These treaty organizations faced little, if any, competition for years after their establishment. Now, technological advances, such as enhancements in satellite capacity and capabilities, as well as new applications and rising demand, have made it economically feasible for private companies to provide satellite-based services and expand the range of services being offered, including new video broadcast and mobile telephone services. Although some believe that the organizations may no longer be needed, others contend that the organizations are still necessary to guarantee safety at sea and services such as telephone and data transmission, especially for developing countries. This report describes the potential competitive impact of (1) different approaches to reforming the organizations; (2) an Inmarsat affiliate company, formed in 1994 to provide new services; and (3) proposals for restructuring INTELSAT.
