organization’s structure is highly unusual; it operates for the most part on business principles, yet its owners are almost all governmental bodies. INTELSAT’s success in combining politics and economics in an ongoing and growing enterprise must be regarded as a positive indication that it would not be impossible to create a similarly viable framework for a SPS network. It is thus of interest to understand how INTELSAT got to where it is today. Its creation was not automatic or even easy, even though the technical and economic advantages of satellites for long distance transmissions were obvious at the time communication satellites were developed, in the first half of the 1960s. The negotiation which led to signing, in August 1964, of interim agreements creating a consortium for international satellite communications were full of conflict and not certain of success. At that time, the United States had a monopoly in the noncommunist world of both the technology for satellite communications and the capability to put payloads into geosynchronous orbit. The United States attempted to dictate the terms on which an international communications satellite network would be formed. What the United States was proposing to create was a system in which its representative, the Communications Satellite Corporation (Comsat), would be dominant. Comsat was a unique hybrid organization, created by the U.S. Government and given a monopoly over operating communication satellites, but chartered as essentially a new business venture, so that its operating principles were commercial in character and its ownership largely in private hands. Comsat assumed the lead for the United States in the negotiations over creating an international communications satellite system. Its preferred organizational design was a series of bilateral agreements between Comsat and the relevant communications agency in another country, in which Comsat would retain ownership of all satellites and charge others a users fee for access to them. But other organizations within the United States, particularly the Department of State, and European participants in the negotiations were strongly opposed to such formal Comsat monopoly control over an international system, and it became clear during the early stages of negotiations that some sort of multilateral structure would be the only acceptable approach. The Europeans agreed among themselves to negotiate with the United States as a bloc, recognizing that only through this approach could they effectively exert their influence. The European position was that any new organization should be fully internationally-owned and operated, and that a new international organization with a governing body of government representatives and a staff of international civil servants should be created for this purpose. Comsat ultimately proposed a compromise position, calling for (a) a consortium of telecommunication entities, rather than an intergovernmental organization; (b) membership limited to those making capital investments in the system, and voting power based on investment share; (c) Comsat to make by far the largest investment, thereby assuring majority control of the organization; (d) Comsat to manage the system under contract to the consortium. The European bloc, recognizing that Comsat, by virtue of its control over satellite and rocket technology, was in a very strong bargaining position, grudgingly accepted this compromise, but only on an interim basis. Comsat’s dominance was accepted
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