Globalstar Plan May Hinge on Regulator Who Supports Critics

  • U.S. FCC member Michael O’Rielly holds sought-after vote
  • Globalstar wants to serve millions with new airwaves use rules

Globalstar Inc.’s proposal to open new frequencies to smartphones may hinge on a regulator who has publicly backed opposing uses of the airwaves.

Globalstar wants to offer mobile broadband over airwaves now limited to satellite service, and to make use of neighboring airwaves. Wi-Fi and Bluetooth advocates say the plan could cause interference to millions of hearing aids, gaming consoles and cable hotspots and have urged rejection of the plan.

The five-member Federal Communications Commission is voting on Globalstar’s plan, a process that can take days or weeks. FCC Chairman Tom Wheeler, who leads the Democratic majority, backs the plan. A Republican commissioner said he voted against it, and a Democrat is said to also have voted ”no.” If those votes don’t change during internal negotiations, Globalstar’s plan rests in the hands of a Democratic member, who generally supports Wheeler, and Republican Michael O’Rielly, who often votes against the chairman and backs expanded use of Wi-Fi.

“It might come down to him,” said Brent Skorup, a technology policy research fellow at George Mason University’s Mercatus Center in Arlington, Virginia.

O’Rielly, 44, a former congressional staffer, hasn’t said how he’ll vote -- making him and his staff an object of interest for both sides of the debate. On June 3, the day shares dropped by more than half, O’Rielly spoke by telephone with John Kneuer, a Globalstar director and former U.S. telecommunications official, according to a disclosure filing.

The prospect of a third “no” vote pushed Globalstar shares to a record drop last week. Globalstar rose for a second day, closing up 5.6 percent at $1.13.

Gaming, Wi-Fi

Groups contacting O’Rielly’s staff in the past week include the Entertainment Software Association, which says operations could be degraded for millions of gaming consoles if Globalstar’s allowed to operate, and the National Cable & Telecommunications Association, which wants to ensure smooth operations for Wi-Fi hotspots established by members including top U.S. cable provider Comcast Corp.

Lined up against Globalstar is the Wi-Fi Alliance, which in a June 3 letter asked Wheeler to withdraw the proposal, saying it hadn’t been tested and could “undermine the very foundation” for using unlicensed airwaves. Members of the trade group include software and game console maker Microsoft Corp., chip maker Qualcomm Inc., and Comcast, which operates 14 million Wi-Fi hotspots.

Globalstar based in Covington, Louisiana, has told the FCC that if its plan is approved, it may serve customers through millions of access points, or hotspots. At the end of last year, the company has about 688,000 subscribers to its satellite service, according to an annual filing.

Mobile Devices

The outpouring of interest reflects a changed circumstance in the use of airwaves, with an increasingly important role played by millions of small devices operating at low power. Wi-Fi hotspots carry video for cable companies and traffic for mobile-phone providers such as AT&T Inc. and Verizon Communications Inc.

Globally, public Wi-Fi hotspots will grow seven-fold, to 432 million, by 2020, according to the Visual Networking Index forecast by Cisco Systems Inc. Wi-Fi and mobile devices will carry most internet traffic, according to the forecast.

Small gadgets have likewise gained a more prominent role before policy makers.

“Five or ten years ago, nobody would have worried about the impact” on frequencies then derided as “junk,” said Harold Feld, senior vice president at Public Knowledge, a Washington-based policy group. Now, Feld said, “You have billions of dollars of investment in Wi-Fi and Bluetooth” and other technologies.

‘More Wi-Fi’

O’Rielly has at times allied himself with Democrat Jessica Rosenworcel, the FCC commissioner who voted against the Globalstar proposal last week, according to a person familiar with the matter who asked not be identified because the voting hasn’t been made public. Last year, the two in a joint statement called for increased airwaves for Wi-Fi. “More needs to be done -- and soon,” the commissioners wrote. They called for testing in a set of airwaves set aside for automobiles that’s separate from those at issue in the Globalstar debate.

In a 2014 statement, O’Rielly lauded an FCC move to ease Wi-Fi congestion. Earlier steps had turned lightly regarded airwaves swaths from “trash into treasure” that host “popular wireless services, the most notable being Wi-Fi and Bluetooth” and including baby monitors, cordless phones and garage door openers, O’Rielly said.

“You could read his statements either way,” Skorup said in an interview. “He certainly speaks highly of Wi-Fi” yet also in one statement expressed reservations about a step the FCC took to protect the technology.

Tallying Votes

Commissioner Mignon Clyburn, a Democrat, hasn’t cast a vote yet, but often backs Wheeler’s proposals. Republican Ajit Pai announced his “no” vote on June 2, and said the proposal would give “a particular company special rights.” The matter could remain before commissioners for many days, and even those who have voted in the agency’s electronic system could change their votes.

Insulin pumps, heart rate monitors and hearing aids are some products that would suffer “destructive interference” from Globalstar’s proposed use, and the company’s application should be denied, the Bluetooth Special Interest Group said in a June 2 filing at the FCC. Leaders of the group that says it represents 30,000 member companies include executives from tech leader Apple Inc., chipmaker Intel Corp., and network equipment maker Ericsson AB.

Allison Hoffman, a spokeswoman for Globalstar, declined to comment.

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