SkyTerra (Canada) Inc.


300 Slater Street
Ottawa, Ontario
K1A 0C8

Our File: 46215–1 (183846 PL)

January 29, 2010

Mr. Bahman Azarbar
Vice–President, Regulatory Affairs
SkyTerra (Canada) Inc.
1601 Telesat Court
Gloucester, ON K1B 5P4

Dear Mr. Azarbar:

I refer to your letter dated October 8, 2009 seeking approval for SkyTerra Canada Inc. (SkyTerra) to reuse L–band mobile satellite service (MSS) spectrum currently assigned to two Mexican satellites operated by Telecomm de Mexico for use by the MSV–2 and MSV–1 satellites, including the associated ancillary terrestrial component (ATC). The Mexican spectrum was assigned under the 1996 Mexico City Memorandum of Understanding (MOU) and the associated Spectrum Sharing Arrangements.

In reviewing your application, the Department has noted that SkyTerra's new satellites and their use of re–configurable spot beam technology will enable it to the reuse the Mexican spectrum without increasing the interference potential to existing Mexican MSS operations. We have reviewed the technical analysis provided to demonstrate that SkyTerra can operate its next–generation system, including its ATC operations, within interference levels acceptable to Telecomm de Mexico and we concur with your findings. We also note that the reuse of the Mexican spectrum will provide more efficient use of the L–band spectrum and enable the deployment of more advanced mobile satellite services. Furthermore, we recognize that, despite SkyTerra's efforts to conclude coordination of its new satellite network with the existing Mexican satellite, current delays in the coordination process are beyond your control.

In light of the above, based on the results of our technical analysis and the supporting information provided in your application, we have concluded that it would be in the public interest to support this request. Accordingly, I am pleased to grant revised approvals in principle to SkyTerra for the reuse of the assigned L–band Mexican spectrum on the MSV–2 and MSV–1 satellites to provide service in Canada. With respect to the reuse of the Mexican spectrum for ATC, this approval is granted without prejudice to the Department's consideration of SkyTerra's ATC licence application. These approvals in principle are also granted subject to SkyTerra Canada Inc.'s written acceptance, within 30 days from the date of this letter, of the conditions noted in the attachments.

I wish to remind you that future authorization of ATC operations is dependent upon resolution of a few regulatory issues. As you are aware technical specifications and authorization procedures for the deployment of ATC services in Canada have not been published yet, nor has the Department initiated any public consultation for the establishment of an appropriate spectrum fee for the service. The required consultation on a spectrum fee will only be initiated once an application by SkyTerra, or any other MSS operators wishing to provide ATC in Canada, is submitted to the Department. Due to the lengthy period for conducting public consultations and adopting a new spectrum fee, we urge SkyTerra to submit an application as soon as possible.

In accordance with our commitment to fair, open and transparent licensing processes, Industry Canada will make this letter and the attached conditions available to the public. Should you have any questions regarding this letter, please contact me at (613) 998–3819 or Paul Lajoie at (613) 998–3775.

Yours sincerely,

Chantal Beaumier
Director, Space Services

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Attachment 1

Conditions of Licence to Provide Mobile Satellite Services in Canada via the MSV-2 Satellite

1. Eligibility

SkyTerra Canada Inc. (SkyTerra Canada) shall conform with eligibility criteria as set out for a radiocommunication carrier in section 10(2)(d) of the Radiocommunication Regulations.

2. Licence Transferability

This spectrum licence may not be transferred or assigned without a full review of the application by the Department and authorization of the Minister. For clarification, and without limiting the generality of the foregoing, “transfer” includes any leasing, sub–leasing or other disposition of the rights and obligations of the licences and, also includes any change which would have a material effect on the ownership or control in fact of SkyTerra Canada.

3. Laws, Regulations, and Other Obligations

  1. SkyTerra Canada is subject to and must comply with the ITU Radio Regulations, the Canadian Radiocommunication Act and the Radiocommunication Regulations, and Canada's spectrum policies pertaining to its authorized radio frequency bands and satellite orbital position.
  2. The operation of the facilities and services being provided shall be in conformity with relevant Canadian laws and regulations.
  3. SkyTerra Canada shall operate the satellite as a Canadian radiocommunication carrier and shall offer directly or through re–sellers the satellite services or capacity on a non–discriminatory basis.

4. Service to all Regions of Canada

SkyTerra Canada shall make fair and reasonable efforts to provide mobile satellite services to all regions of Canada within the coverage contour and service availability of the MSV–2 satellite.

5. Research and Development

SkyTerra Canada shall invest a minimum of 2 percent of their adjusted gross revenues resulting from the provision of mobile satellite services via the MSV–2 satellite on satellite–related research and development activities. This investment may be averaged over a 5 year period, with the first averaging period beginning with the commencement of service provision in Canada. Eligible research and development is that which meets the definition adopted by the Canada Customs and Revenue Agency. Adjusted gross revenues are defined as total service revenues less intercarrier payments, bad debts, third party commissions and provincial and goods and services taxes collected.

Licensees with less than $5 million in annual gross operating revenues are exempt from research and development expenditure requirements, except where they have affiliations with licensees that hold other licences with the research and development condition of licence and where the total annual gross revenues of the affiliated licensees are greater than $5 million.

6. Implementation Milestones

SkyTerra Canada shall meet the following implementation milestones by the respective dates set out in the following table:

Implementation Milestones
  Milestone Date
1 Submission of final design specifications to Department for approval December 15, 2006
2 Signature of contracts for the construction and launch of the satellite March 15, 2007
3 Placement of the satellite into its assigned orbital position April 23, 2011

7. Lawful Interception

  1. SkyTerra Canada shall provide and maintain lawful interception capabilities as authorized by law. The requirements for lawful interception capabilities are provided in the publication entitled Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications. These standards may be periodically amended following consultation with the Minister of Public Safety Canada and the licensees.
  2. SkyTerra Canada may request the Minister to forbear from enforcing certain assistance capability requirements for a limited period. The Minister, following consultation with the Minister of Public Safety Canada, may exercise his power to forbear from enforcing a requirement or requirements where in the opinion of the Minister, the requirement(s) is (are) not reasonably achievable. Forbearance requests must include specific details and dates when compliance to requirement(s) can be expected.

8. Operational Frequency Requirements

  1. Service link operations shall be restricted to those band segments allotted to SkyTerra by means of:
    • the 1999 Operating Agreement for Geostationary Mobile–Satellite Systems Operating in the Bands 1525–1544/1545–1559 and 1626.5–1645.5/1646.5–1660.5 MHz, originally established at Mexico City, Mexico, in June 1996, or any subsequent amendments to this operating agreement, and
    • the 2008 Understanding between the Department of Industry (Canada), the Federal Communications Commission (USA) and the Office of Communications (UK) for the Coordination of Satellite Networks Operating in the L Frequency Band.
  2. In accordance with No. 5.357A of the ITU Radio Regulations, in the bands 1545–1555 MHz and 1646.5–1656.5 MHz, stations of mobile satellite systems shall give priority to accommodating the spectrum requirements of the aeronautical mobile–satellite (R) service providing transmissions of messages with priorities 1 to 6 as described in Article 44.
  3. In accordance with No. 5.353A of the ITU Radio Regulations, in the bands 1530–1544 MHz and 1626.5–1645.5 MHz, maritime mobile–satellite distress, urgency and safety communications shall have priority access and immediate availability over all other mobile–satellite communications. Communications with stations not participating in the global maritime distress and safety system (GMDSS) shall not cause unacceptable interference to, or claim interference from, distress, urgency and safety communications of the GMDSS.
  4. Notwithstanding condition a) and until the conclusion of a bilateral coordination agreement, SkyTerra Canada can also operate service links using Mexican spectrum assigned to Telecomm de Mexico on a no–protection non–interference basis.
  5. The aggregate e.i.r.p. density of uplink emissions from either satellite or ATC operations (or both) toward the Mexican satellite shall not exceed –42.3 dBW/Hz (treetop). SkyTerra Canada shall estimate on a continual basis, by emulation or estimation, the aggregate eirp density of the emissions from the SkyTerra system toward the Mexican satellite. Once the estimated eirp density reaches –45.3 dB/Hz, SkyTerra will be required to verify the eirp density level by actual measurements carried out every six (6) months. For the purpose of this condition, the SkyTerra system includes both the American and Canadian satellite and ATC operations.
  6. The aggregate downlink emissions received at any point within the Mexican satellite service area from either satellite or ATC operations (or both) shall not exceed an aggregate effective power flux spectral density (pfsd) of –202.5 dBW/m2 Hz (equivalent to an e.i.r.p. density emission level of –40 dBW/Hz at a point of origination at a geostationary satellite position). The Mexican satellite service area shall include any point in Mexico and its Exclusive Economic Zone.

9. Use of Feeder Link and Telemetry, Telecommand and Control Spectrum

Feeder link earth stations shall be coordinated with terrestrial fixed services and be implemented in accordance with the Canadian Table of Frequency Allocations. Use of the feeder link spectrum shall be implemented in accordance with the provisions of Appendix 30B of the ITU Radio Regulations for the 107.3°W orbital position. The operation of feeder link earth stations shall not cause harmful interference to the radio astronomy service operating in the adjacent frequency band of 10.68–10.7 GHz.

SkyTerra Canada shall coordinate the use of spectrum for its feeder link and telemetry, telecommand and control (TT&C) operations with TerreStar Networks (Canada) Inc.

10. International Coordination of Satellite

The satellite shall be coordinated internationally prior to commencement of operation, and be notified to the ITU. To this end, SkyTerra Canada shall, at its own expense:

  • participate with the Department to successfully complete the procedures of Appendix 30B of the ITU Radio Regulations to incorporate the characteristics of the allotment Ku frequency assignments of the satellite network in the Appendix 30B List;
  • participate with the Department to successfully complete the procedures of Articles 9 and 11 of the ITU Radio Regulations to coordinate and notify the L–band band frequency assignments of the satellite network; and
  • provide the Department, in a form acceptable to the ITU, with any required information,
  • and be responsible for the payment of all ITU processing charges related to the submission of this information.

SkyTerra Canada shall fulfill all commitments made by Canada pursuant to all international coordination arrangements and agreements for the operation of its mobile satellite network in the 107.3°W orbital position.

11. Orbital Debris Mitigation

The satellite, at the end of its life, shall be removed from the geostationary satellite orbit region in a manner consistent with Recommendation ITU–R S.1003 Environmental Protection of the Geostationary Satellite Orbit.

12. Subscriber Earth Stations

  1. Subscriber earth stations are authorized to operate in Canada only. Any roaming into other countries shall respect the licensing regimes of those countries. To ensure compliance, SkyTerra Canada shall provide its subscribers with a copy of this condition.
  2. Subscriber earth stations shall meet all applicable Canadian radio equipment standards and be type–approved for use in Canada.
  3. The operation of subscriber earth stations shall not cause harmful interference to the radio astronomy service operating in the same or adjacent frequency bands.
  4. Subscriber earth stations shall comply with Health Canada's Limits of Human Exposure to Radiofrequency Electromagnetic Fields in the Frequency Range from kHz to 300 GHz – Safety Code 6.

13. Requirement to Hold Licences

Prior to commencement of operation of the satellite and the provision of mobile satellite service in Canada, SkyTerra Canada shall obtain all necessary radio authorizations from the Department.

To this end, SkyTerra Canada shall submit the administrative licensing information, set out in Annex B of Client Procedures Circular 2–6–02 (CPC–2–6–02), Licensing of Space Stations in Services other than the Amateur Satellite Service and the Broadcasting Satellite Service in Planned Bands, at least 90 days in advance of the anticipated launch date of the satellite. Additionally, all feeder link and telemetry, telecommand and control earth stations communicating with the satellite must be licensed prior to operation pursuant to Client Procedures Circular 2–6–01 (CPC– 2–6–01), Procedure for the Submission of Applications to License Fixed Earth Stations and to Approve the Use of Foreign Fixed–Satellite Service (FSS) Satellites in Canada.

Authorization of any future operation of terrestrial mobile services (ATC) will be subject to Industry Canada's spectrum and licensing policy (RP–023), noting further technical standards will need to be developed. Also, as indicated in RP–023, the spectrum fees for ATC mobile services will be established in a future public consultation.

14. Annual Reports Prior to Satellite Launch

SkyTerra Canada shall submit a detailed annual report to Industry Canada. This annual report must include:

  • an update indicating progress made in all areas respecting this licence;
  • an update indicating continued compliance with all licence conditions;
  • an update on any coordination negotiations undertaken pursuant to conditions 9, and 10;
  • copies of any existing annual report for SkyTerra Canada's fiscal year with respect to this authorization; and
  • a current listing of all satellite capacity being made available through this approval and consequent authorizations, the capacity assigned to Canadian service providers and others, including the parties to which it is assigned, and any unused capacity including the terms of its availability.

These annual reports shall be augmented with semi–annual interim reports providing an update on all aspects of the design, procurement, construction, coordination and launch of the satellite until the satellite has been put into service. The next interim report will be due September 30, 2010, and the next annual report will be due March 31, 2010. These reports must be submitted, in writing, to the Director, Space Services.

15. Annual Reports After Satellite Launch

SkyTerra Canada shall submit an annual report for each year of operation indicating continued compliance with these conditions, including:

  • an update on the status of the mobile satellite service, including the relative growth of the services provided, and the numbers of fixed and mobile subscriber stations operating within Canada;
  • a statement of gross operating revenues and, where applicable, under condition 5 above a statement of adjusted gross revenues, and an audited statement of research and development expenditures;
  • further to conditions 8 (a) and (d) above, an update on the spectrum being used to provide services in Canada; and
  • a copy of any existing corporate annual report for your fiscal year with respect to this authorization.

These reports are to be submitted in writing within 120 days of your fiscal year end to the Director, Space Services.

16. Traffic Reports

SkyTerra Canada shall submit a traffic report for the satellite at the commencement of operations and every three months thereafter, indicating the channel capacity of each assigned feeder link transmit and receive frequency in terms of the number of telephone channels carried on each frequency, or telephone channel equivalencies as determined by application of section 58 of the Radiocommunication Regulations including all supporting information used to make this determination. These reports will be submitted, in writing, to the Manager, Authorization Policy, Space Services Directorate.

17. Payment of Licence Fees

SkyTerra Canada shall pay the applicable annual radio authorization fees within 15 days of acceptance in orbit of the satellite from the manufacturer, and on or before March 31 of each year thereafterFootnote 1.

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Attachment 2

Conditions of Licence to Provide Mobile Satellite Services in Canada via the MSV–1 Satellite

1. Eligibility

SkyTerra (Canada) Inc. (SkyTerra Canada) shall conform with eligibility criteria as set out for a radiocommunication service provider in section 10.1(3)(b) of the Radiocommunication Regulations.

2. Licence Transferability

This spectrum licence may not be transferred or assigned without a full review of the application by the Department and authorization of the Minister. For clarification, and without limiting the generality of the foregoing, “transfer” includes any leasing, sub–leasing or other disposition of the rights and obligations of the licences.

3. Laws, Regulations, and Other Obligations

  1. SkyTerra Canada is subject to and must comply with the ITU Radio Regulations, the Canadian Radiocommunication Act and the Radiocommunication Regulations, and Canada's spectrum policies pertaining to its authorized radio frequency bands and satellite orbital positions.
  2. The operation of the facilities and services being provided shall be in conformity with relevant Canadian laws and regulations.

4. Service to all Regions of Canada

SkyTerra Canada shall make fair and reasonable efforts to provide mobile satellite services to all regions of Canada within the coverage contour and service availability of the MSV–1 satellite.

5. Research and Development

SkyTerra Canada shall invest a minimum of 2 percent of their adjusted gross revenues resulting from the provision of mobile satellite services via the MSV–1 satellite on satellite–related research and development activities. This investment may be averaged over a 5 year period, with the first averaging period beginning with the commencement of service provision in Canada. This investment shall be in addition to any investment required as a result of the authorization issued to provide services via the MSAT–1 and MSAT–2 satellites.

Eligible research and development is that which meets the definition adopted by the Canada Customs and Revenue Agency. Adjusted gross revenues are defined as total service revenues less intercarrier payments, bad debts, third party commissions and provincial and goods and services taxes collected.

Licensees with less than $5 million in annual gross operating revenues are exempt from research and development expenditure requirements, except where they have affiliations with licensees that hold other licences with the research and development condition of licence and where the total annual gross revenues of the affiliated licensees are greater than $5 million.

6. Lawful Interception

  1. SkyTerra Canada shall provide and maintain lawful interception capabilities as authorized by law. The requirements for lawful interception capabilities are provided in the publication entitled Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications. These standards may be periodically amended following consultation with the Minister of Public Safety Canada and the licensees.
  2. SkyTerra Canada may request the Minister to forbear from enforcing certain assistance capability requirements for a limited period. The Minister, following consultation with the Minister of Public Safety Canada, may exercise his power to forbear from enforcing a requirement or requirements where in the opinion of the Minister, the requirement(s) is (are) not reasonably achievable. Forbearance requests must include specific details and dates when compliance to requirement(s) can be expected.

7. Subscriber Earth Stations

  1. Subscriber earth stations are authorized to operate in Canada only. Any roaming into other countries shall respect the licensing regimes of those countries. To ensure compliance, SkyTerra Canada shall provide its subscribers with a copy of this condition.
  2. Subscriber earth stations shall meet all applicable Canadian radio equipment standards and be type–approved for use in Canada.
  3. The operation of subscriber earth stations shall not cause harmful interference to the radio astronomy service operating in the same or adjacent frequency bands.
  4. Subscriber earth stations shall comply with Health Canada's Limits of Human Exposure to Radiofrequency Electromagnetic Fields in the Frequency Range from kHz to 300 GHz – Safety Code 6.

8. Operational Frequency Requirements

  1. Service link operations shall be restricted to those band segments allotted to SkyTerra by means of:
    • the 1999 Operating Agreement for Geostationary Mobile–Satellite Systems Operating in the Bands 1525–1544/1545–1559 and 1626.5–1645.5/1646.5–1660.5 MHz, originally established at Mexico City, Mexico, in June 1996, or any subsequent amendments to this operating agreement, and
    • the 2008 Understanding between the Department of Industry (Canada), the Federal Communications Commission (USA) and the Office of Communications (UK) for the Coordination of Satellite Networks Operating in the L Frequency Band.
  2. In accordance with No. 5.357A of the ITU Radio Regulations, in the bands 1545–1555 MHz and 1646.5–1656.5 MHz, stations of mobile satellite systems shall give priority to accommodating the spectrum requirements of the aeronautical mobile–satellite (R) service providing transmissions of messages with priorities 1 to 6 as described in Article 44.
  3. In accordance with No. 5.353A of the ITU Radio Regulations, in the bands 1530–1544 MHz and 1626.5–1645.5 MHz, maritime mobile–satellite distress, urgency and safety communications shall have priority access and immediate availability over all other mobile–satellite communications. Communications with stations not participating in the global maritime distress and safety system (GMDSS) shall not cause unacceptable interference to, or claim interference from, distress, urgency and safety communications of the GMDSS.
  4. Notwithstanding condition a) and until the conclusion of a bilateral coordination agreement, SkyTerra Canada can also operate service links using Mexican spectrum assigned to Telecomm de Mexico on a no–protection non–interference basis.
  5. The aggregate e.i.r.p. density of uplink emissions from either satellite or ATC operations (or both) toward the Mexican satellite shall not exceed –42.3 dBW/Hz (treetop). SkyTerra Canada shall estimate on a continual basis, by emulation or estimation, the aggregate eirp density of the emissions from the SkyTerra system toward the Mexican satellite. Once the estimated eirp density reaches –45.3 dB/Hz, SkyTerra will be required to verify the eirp density level by actual measurements carried out every six (6) months. For the purpose of this condition, the SkyTerra system includes both the American and Canadian satellite and ATC operations.
  6. The aggregate downlink emissions received at any point within the Mexican satellite service area from either satellite or ATC operations (or both) shall not exceed an aggregate effective power flux spectral density (pfsd) of –202.5 dBW/m2 Hz (equivalent to an e.i.r.p. density emission level of –40 dBW/Hz at a point of origination at a geostationary satellite position). The Mexican satellite service area shall include any point in Mexico and its Exclusive Economic Zone.

9. Annual Reports

SkyTerra Canada must submit an annual report for each year of operation indicating continued compliance with these conditions, including:

  • an update on the status of the mobile satellite service, including the relative growth of the services provided, and the numbers of fixed and mobile subscriber stations operating within Canada;
  • a statement of gross operating revenues and, where applicable, under condition 5 above a statement of adjusted gross revenues, and an audited statement of research and development expenditures;
  • further to conditions 8 (a) and (d) above, an update on the spectrum being used to provide services in Canada;
  • a copy of any existing corporate annual report for your fiscal year with respect to this authorization.

These reports are to be submitted in writing within 120 days of your fiscal year end to the Manager, Authorization Policy, Space Services Directorate.

10. Licence Fees

SkyTerra Canada must pay the applicable annual authorization fees on or before March 31 of each year.

Footnotes

Footnote 1

Such fees are established as appropriate by application of the Radiocommunication Regulations and the Minister of Industry's fee order, Notice No. DGRB-009-99 — Radio Authorization Fees for Mobile Satellite Services Using Radio Spectrum Above GHz.

Return to footnote 1 referrer

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