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06/01/84 Wold Communications, Inc., v. Federal Communications

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT


June 1, 1984

WOLD COMMUNICATIONS, INC., APPELLANT

v.

FEDERAL COMMUNICATIONS COMMISSION, APPELLEE, WESTINGHOUSE BROADCASTING AND CABLE, INC., CITICORP, TURNER BROADCASTING

COMMUNICATIONS, INC., PETITIONER

v.

FEDERAL COMMUNICATIONS COMMISSION AND UNITED STATES OF AMERICA, RESPONDENTS, WESTERN UNION TELEGRAPH COMPANY, MCI TELECOMMUNICATIONS

NETWORK, INC., INTERVENORS; SATELLITE SYNDICATED SYSTEMS, INC., PETITIONER

v.

FEDERAL COMMUNICATIONS COMMISSION AND

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

SYSTEMS, INC., HOME BOX OFFICE, INC., HUGHES

COMMUNICATIONS, INC., SOUTHERN PACIFIC COMMUNICATIONS CO.,

MCI TELECOMMUNICATIONS CORP., AMERICAN BROADCASTING

COMPANIES, INC. AND CBS, INC., WESTERN UNION TELEGRAPH

COMPANY, SOUTHERN PACIFIC SATELLITE CO., VIACOM INTERNATIONAL, INC., NATIONAL CABLE SATELLITE CORP.,

SPANISH INTERNATIONAL NETWORK, INC., Intervenors; WOLD

CORP., SOUTHERN PACIFIC COMMUNICATIONS CO., WESTINGHOUSE

BROADCASTING AND CABLE, INC., HUGHES COMMUNICATIONS, INC.,

AMERICAN BROADCASTING COMPANIES, INC., and CBS, INC., GTE

SATELLITE CORPORATION, HOME BOX OFFICE, INC., TURNER

BROADCASTING SYSTEM, INC., CITICORP, DOW JONES & COMPANY, INC., SOUTHERN PACIFIC SATELLITE CO., VIACOM INTERNATIONAL, INC., NATIONAL CABLE SATELLITE CORP., SPANISH INTERNATIONAL

UNITED STATES OF AMERICA, Respondents, WESTERN UNION

TELEGRAPH COMPANY, SOUTHERN PACIFIC COMMUNICATIONS CO.,

WESTINGHOUSE BROADCASTING AND CABLE, INC., HUGHES

COMMUNICATIONS, INC., AMERICAN BROADCASTING COMPANIES, INC., and CBS, INC., CITICORP, TURNER BROADCASTING SYSTEM, INC., HOME BOX OFFICE, INC., GTE SATELLITE CORPORATION, RCA

AMERICAN COMMUNICATIONS, INC., DOW JONES & COMPANY, INC.,

SOUTHERN PACIFIC SATELLITE COMPANY, VIACOM INTERNATIONAL, INC., NATIONAL CABLE SATELLITE CORP., SPANISH INTERNATIONAL

NETWORK, INC., INTERVENORS; SATELLITE SYNDICATED SYSTEMS, INC., Appellant v. FEDERAL COMMUNICATIONS COMMISSION, Appellee, WESTINGHOUSE BROADCASTING AND CABLE, INC.,

CITICORP, TURNER BROADCASTING SYSTEM, INC., HOME BOX

OFFICE, INC., RCA AMERICAN COMMUNICATIONS, INC., WESTERN

UNION TELEGRAPH COMPANY, SOUTHERN PACIFIC COMMUNICATIONS

CO., AMERICAN BROADCASTING COMPANIES, INC., and CBS, INC.,

HUGHES COMMUNICATIONS, INC., GTE SATELLITE CORPORATION, DOW

JONES & COMPANY, INC., SOUTHERN PACIFIC SATELLITE CO., VIACOM INTERNATIONAL, INC., NATIONAL CABLE SATELLITE CORP.,

SPANISH INTERNATIONAL NETWORK, INC., Intervenors; WOLD

COMMUNICATIONS, INC., Appellant v. FEDERAL COMMUNICATIONS

COMMISSION, Appellee, SOUTHERN PACIFIC SATELLITE COMPANY,

Intervenor

Nos. 82-2054, 82-2055, 82-2078, 82-2079, 82-2422 1984.CDC.155

No. 82-2054: Appeal from an Order of the Federal Communications Commission.

Nos. 82-2055, 82-2078: Petitions for Review of an Order of the Federal Communications Commission.

Nos. 82-2079, 82-2422: Appeals from an Orders of the Federal Communications Commission.

APPELLATE PANEL:

Mikva and Ginsburg, Circuit Judges, and Bazelon, Senior Circuit Judge. Opinion for the Court filed by Circuit Judge Ginsburg.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE GINSBURG

This case concerns the regulatory regime for key pieces of radio equipment, called transponders, located on domestic communications satellites (domsats). A transponder picks up information broadcast to a satellite by a "transmit" earth station, amplifies it, and relays it back to any "receive" earth station tuned into that satellite. The domsats in the matter before us, in the main, are or will be equipped with twenty-four operational transponders per satellite. *fn1 Domsat operators generally have leased transponders on a common carrier basis in accordance with the "just and reasonable" tariff strictures of the Communications Act. See Communications Act of 1934 tit. II, 47 U.S.C. 201-224 (1976 & Supp. V 1981). In the orders on review, the Federal Communications Commission (FCC or Commission) authorized the sale of certain discrete transponders on a non-common carrier basis. Domestic Fixed-Satellite Transponder Sales, 90 F.C.C.2d 1238 (1982) (Transponder Sales Order). *fn2 The Commission's decision, we conclude, is within its statutory authority and is adequately reasoned; we therefore affirm the FCC's orders.

The Commission has made a modest adjustment. It has not displaced regulated common carrier service as the dominant mode for domsat operations. *fn3 It has agreed to entertain transponder sale applications on a case-by-case basis. Simultaneously, the FCC announced its intention to disallow sales should it "develop that . . . additional transponders are required for users who need common carrier service." Id. at 1255.

Rapid technological advances, demand shifts, and changes in entrepreneurial judgments regarding satellite design and marketing have marked the period since 1974, when the first commercial domsat was orbited. *fn4 Appropriately, the FCC has not attempted to impose an inflexible regulatory regime on an industry "characterized by fluidity." Id. at 1247. Instead, the Commission has proceeded tentatively in an effort to develop sensible regulatory approaches responsive to the public interest. For this task, it has received no new instructions from Congress. Its sole guide from the legislature is the Communications Act, passed in 1934, decades before the advent of domsats.

We confront on review an arcane, fast-moving field of technology, opposing estimates of down the road supply and demand derived from currently available information, and no congressional action geared specifically to the new, burgeoning domsat industry. In these circumstances a reviewing court owes particular deference to the expert administrative agency's policy judgments and predictions, its forecasts of "the direction in which future public interest lies." FCC v. WNCN Listeners Guild, 450 U.S. 582, 595, 67 L. Ed. 2d 521, 101 S. Ct. 1266 (1981) (quoting FCC v. National Citizens Committee for Broadcasting, 436 U.S. 775, 814, 98 S. Ct. 2096, 56 L. Ed. 2d 697 (1978)).

We are persuaded by the record that the FCC, in authorizing a limited departure from the status quo, acted within its discretion. Petitioners assert that the Commission ruled outside its delegated authority and did not engage in reasoned decisionmaking; neither contention survives review faithful to our precedent. See, e.g., Office of Communication of the United Church of Christ v. FCC, 228 U.S. App. D.C. 8, 707 F.2d 1413 (D.C. Cir. 1983). I. BACKGROUND

The Commission first invited applications for commercial domestic satellite service in 1970. Domestic Communication-Satellite Facilities, 22 F.C.C.2d 86 (1970) (Domsat I). At that time, the FCC recognized the potentially significant contribution domsats could make to the nation's communications system, id. at 89-90, but it had not yet determined basic issues -- whether satellites should be special-purpose or multipurpose, whether they should be operated by a governmental corporation or by private industry. In soliciting concrete proposals, the Commission announced:

We will consider applications by all legally, technically, and financially qualified entities proposing the establishment and operation of domestic communications satellite systems . . . . Applicants may propose the rendition of such services directly to the public on a common carrier basis or by the lease of facilities to other common carrier, or any combination of such arrangements. Applicants may also propose private ownership and use or the joint cooperative use of the system by the several owners thereof. Applicants may further propose the shared use of some facilities by different systems, or a division in the ownership of various system components (e.g., user ownership of earth stations to afford direct access to the space segment of a common carrier or cooperative system).

Id. at 93-94 (footnote omitted).

Two years later, the FCC settled on a policy under which legally, financially, and technically qualified private entities could receive domsat authorizations upon a showing that the proposed service would inure to the public benefit. Domestic Communications-Satellite Facilities, 35 F.C.C.2d 844 (1972) (Domsat II). In stating the objectives of its regulatory policy, *fn5 the Commission underscored that it sought

to retain leeway and flexibility . . . [in] the use of satellite technology for domestic communications so as to make such adjustments therein as future experience and circumstances may dictate.

Id. at 847. The FCC did not rule definitively that all domestic satellite service must be offered under a regulated common carrier regime. In fact, however, the authorizations it issued for currently operating commercial domsats called for common carrier service -- the leasing of transponders, generally on a first-come, first-served basis, see 47 U.S.C. §§ 201(a), 202, pursuant to "just and reasonable" cost-based tariffs. Id. §§ 201(b), 203. *fn6

In 1979 the FCC proposed reduced domsat regulation; it saw the communications marketplace in which domsats figured as essentially competitive. Competitive Carrier Rulemaking, 77 F.C.C.2d 308 (1979); see Competitive Carrier Rulemaking, 85 F.C.C.2d 1, 26 (1980). In 1980, however, the Commission decided against any instant deregulatory step. Competitive Carrier Rulemaking, 85 F.C.C.2d at 26-27. It observed that in recent months demand for transponder space had grown to exceed supply. *fn7 That situation might persist for the immediate future, the Commission conjectured, because of "technical limit[s] on the number of satellites that will be operating in the near term." Id. at 27. The FCC reached the decision to defer relaxed regulation with misgivings, and stated that it would engage in "continuing assessment." Id. at 11. It cautioned:

It is not clear that consumers are better off with rate regulation of the Domsats. If prices for transponder space are constrained, the market power is transferred to Domsat resale carriers. If, in turn, the prices of the resale carriers are constrained by regulation, it is likely that the windfall rents will be reaped by firms, such as cable systems and program suppliers, rather than the general populace. Under such conditions, the benefits of regulation are questionable.

Id. at 26. *fn8

In 1981 the Commission again proposed relaxed rate regulation of domsats. Competitive Carrier Rulemaking, 84 F.C.C.2d 445 (1981). It suggested that consumers were not the beneficiaries of the lower rates Commission regulation then required; that allowing market prices to rise would promote the development of satellite technology; and that technological innovation, when spurred by price allocation mechanisms, could provide ample opportunities for an increase in the supply of transponder capacity. The advantages of reduced regulation, the FCC forecast, would in the long run outweigh any detrimental impact of price increases in the short run. Id. at 507-08. The Commission had not taken final action on this proposal by the date the Transponder Sales Order issued. *fn9 II. THE COMMISSION'S DECISION

In the Transponder Sales Order, the Commission authorized domestic satellite communications system licensees to make a limited part of their transmission capacity available to end users through sales of transponders on specific satellites. A transponder sale contract conveys to the purchaser an exclusive ownership right in a specific transponder during its useful life. The purchaser may use the property thus acquired as collateral for loans, and may enjoy certain tax benefits as a result of transponder ownership -- notably, accelerated depreciation deductions and investment tax credits. The satellite owner, however, retains responsibility for the operation of the satellite. Sale transactions are not subject to the first-come, first-served allocation mechanism of common carrier service. Buyers negotiate the right to use specific transponders directly with the satellite operator, sometimes even before the satellite is launched. The price is set by contract and is not subject to government regulation. *fn10

The Commission limited its authorization to the specific applications before it. *fn11 It permitted Hughes Communications, Inc. (Hughes) to sell all twenty-four transponders on its Galaxy I satellite, *fn12 RCA American Communications, Inc. (RCA Americom) to sell five of the twenty-four transponders on its Satcom IV satellite, and Western Union Telegraph Co. (Western Union) to sell a total of eleven transponders on two satellites. Both Hughes and RCA Americom have sold transponders only to cable programmers; Western Union has offered its transponders for the provision of other communications services. *fn13

In explaining its decision, the Commission first discussed the potential benefits of the proposed transactions. *fn14 Transponder sales, it found, would provide a means for would-be satellite operators to raise the capital needed to enter the market; *fn15 further, sales would provide a mechanism for gauging demand, and would facilitate risk sharing. Sellers would have an incentive to innovate by designing systems to fit particular users' needs. Buyers could plan ahead with the assurance that desired satellite capacity will be available to them at a set price when they need it. Sales transactions could be structured to meet the specific needs of particular satellite operators and end users; and satellite operators, through their selection of purchasers, could take advantage of complementarities among users. *fn16

Supported by comments from the Federal Trade Commission and the Department of Justice, the FCC rejected arguments, based on supply scarcity assumptions or projections, made by opponents of transponder sales. Opponents argued that because "domsat facilities are currently scarce resources . . . the domsat licensee will be able to obtain supranormal profits for its services." Transponder Sales Order, 90 F.C.C.2d at 1244. They maintained that demand for satellite service would continue to exceed supply for the foreseeable future; that transponder sales would be ineffective in stimulating supply, in view of technical constraints on the number of satellites that could be launched; and that transponder sales would limit satellite service availability to those with "enormous financial resources." Id. at 1245. The Commission, however, noted that as of early 1981 it had authorized the construction of twenty-five new satellites and the launch of twenty new or previously constructed satellites; *fn17 and it forecast that new satellite construction would meet or exceed the anticipated transponder demand. Authorizations now in place, it found, would without more result in a quadrupling of domestic satellite capacity within the next five years. Technological developments could further boost transponder availability by reducing orbital spacing, opening up new frequency bands, and increasing transponder efficiency. The Commission referred to a then pending proposal to reduce orbital spacing; that proposal was in fact adopted, with modifications, roughly a year after the Transponder Sales Order issued. *fn18

The Commission pointed out that the long lead time between initial FCC authorization of a satellite and the satellite's actual commercial operation had contributed to a "lag" between the late 1970s "unexpected surge in demand for transponders and the construction and launch of new satellites sufficient to satisfy that demand." 90 F.C.C.2d at 1250. It concluded, however, that the shortage (which had followed initial years in which "considerable operative capacity sat dormant") was temporary in view of construction underway. See id. at 1252-53. *fn19

There was "no substance," the Commission said, to the prediction that its limited sales allowance would drastically curtail the number of transponders left for common carrier service. Id. at 1253. It was permitting a relatively small number of sales, id. at 1253-54; "the large majority of transponders should remain available on a common carrier basis." Id. at 1254. Small users, the FCC concluded, again in agreement with the Department of Justice and the Federal Trade Commission, would not be shut out of the transponder market; on the contrary, small users who could not afford straight monthly lease arrangements might be positioned to finance a transponder purchase aided by the associated tax benefits and the ability to pledge the transponder as a tangible asset. Id. at 1254-55. Several small users supported the sales authorization, and cited this prospect in their comments. See, e.g., Reply Comments of Vitalink Communications Corp. at 4-5, reprinted in J.A. 298, 301-02; Letter from Equatorial Communications to James R. Keegan, Chief, Domestic Facilities Division, Common Carrier Bureau, FCC (Feb. 19, 1982), reprinted in Comments of Western Union Telegraph Co. at 15, reprinted in J.A. 172, 177.

Finally, the Commission reiterated: "We will, of course, continue to scrutinize every application . . . . Additional non-common carrier satellites will not be authorized if it should develop that their certification would not inure to the public interest (for example, if we find that additional transponders are required for users who need common carrier service.)." 90 F.C.C.2d at 1255. In their separate statements, Commissioners Jones and Rivera underlined the importance they attributed to the Commission's case-by-case approach. Id. at 1279-80. *fn20 III. ARGUMENT

It is the Federal Communications Commission's mission to facilitate development of "the new and far-reaching science of broadcasting" in harmony with the public interest. See FCC v. Pottsville Broadcasting Co., 309 U.S. 134, 137, 84 L. Ed. 656, 60 S. Ct. 437 (1940) (Radio Act of 1927). Congress established two regimes under which the Commission is empowered to "regulat[e] interstate and foreign commerce in communication by wire and radio so as to make available, so far as possible, to all the people of the United States a rapid, efficient, Nationwide, and worldwide wire and radio communication service with adequate facilities at reasonable charges." Communications Act of 1934, 47 U.S.C. § 151 (1976). First, in Title II of the Act, Congress provided for close FCC control over the service and charges of communications common carriers. Id. §§ 201-224 (1976 & Supp. V 1981). Second, in Title III, Congress provided for extensive licensing authority through which

the FCC is to "maintain the control of the United States over all the channels of interstate and foreign radio transmission." Id. § 301.

In the orders under review, the Commission has authorized the provision of transponder service by satellite operators on a non-common carrier basis -- through sales on terms negotiated individually with selected purchasers. The authorization is not blanket. Each applicant must satisfy the Commission that the specifically described sales it proposes are in the public interest; the Commission, as part of its public interest analysis, has undertaken to determine whether sufficient common carrier transponder capacity will remain if the application is granted. Transponder Sales Order, 90 F.C.C.2d at 1255. If sales authorization is approved, the affected transponders are removed from Title II regulation. The domsat operator, however, remains fully subject to the Commission's Title III authority. This court's task, in appraising the Commission's orders, is to decide first, whether the Commission's decision is within the broad range of the FCC's delegated authority under the Communications Act, and if it is, whether the position the Commission has adopted is the product of a rational decisionmaking process. Office of Communication of the United Church of Christ v. FCC, 228 U.S. App. D.C. 8, 707 F.2d 1413, 1422 (D.C. Cir. 1983).

A. Delegated Authority

As noted earlier, see supra note 10, both petitioners acknowledge that the transponder sales the Commission has authorized are non-common carrier offerings. They maintain, however, that the Commission is obliged to fasten on domsat operators an exclusively common carrier regime and may not allow the marketplace to substitute for direct Commission regulation even where the FCC rationally finds that the public interest would be advanced thereby. See Brief for Petitioner/Appellant Satellite Syndicated Services, Inc. at 28-29 (SSS Brief); see also Brief for Petitioner-Appellant Wold Communications, Inc. at 26-27 (Wold Brief). This is unpersuasive argument.

From its initial venture in this area, the FCC contemplated the prospect of both common carrier and non-common carrier operations. Domsat I, 22 F.C.C.2d at 93. *fn21 For the first generation of domsats, the Commission generally provided for the offering of service on a common carrier basis. In line with the rapid growth and development of this new industry, the FCC has now made a moderate adjustment: (1) the Commission continues to exercise Title II common carrier regulatory authority with respect to the large majority of transponders; (2) it is exercising Title III authority to determine whether each proposed non-common carrier transponder sale is in the public interest; (3) it has stated that a key concern in its public interest evaluation is the adequacy of the remaining common carrier capacity to serve users' needs; (4) it has recognized its obligation to monitor the results of the course it is pursuing, and to revise its position if changing circumstances so warrant. Transponder Sales Order, 90 F.C.C.2d at 1255. This court is not positioned to "fault the Commission's policy determination that novel methods evincing the potential for greater efficiency ought to be tried." Telocator Network of America v. FCC, 223 U.S. App. D.C. 336, 691 F.2d 525, 542 (D.C. Cir. 1982).

The drafters of the Communications Act had no vision of a domsat industry, but they designed the statute "to avoid the necessity of repetitive legislation," Computer and Communications Industry Association v. FCC, 224 U.S. App. D.C. 83, 693 F.2d 198, 213 (D.C. Cir. 1982) (quoting National Association of Theatre Owners v. FCC, 136 U.S. App. D.C. 352, 420 F.2d 194, 199 (D.C. Cir. 1969), cert. denied, 397 U.S. 922, 25 L. Ed. 2d 102, 90 S. Ct. 914 (1970)), cert. denied, 461 U.S. 938, 103 S. Ct. 2109, 77 L. Ed. 2d 313 (1983) (Computer II), by arming the Commission "with sufficiently elastic powers such that it could readily accommodate dynamic new developments in the field of communications." Id. (quoting General Telephone Co. v. United States, 449 F.2d 846, 853 (5th Cir. 1971)). As this court recently observed: "Congress' clear intent in 1934 was to confer upon the Commission sweeping authority to regulate in 'a field of enterprise the dominant characteristic of which was the rapid pace of its unfolding.'" Office of Communication of the United Church of Christ v. FCC, 707 F.2d at 1423 (quoting National Broadcasting Co. v. United States, 319 U.S. 190, 219, 87 L. Ed. 1344, 63 S. Ct. 997 (1943)).22

The FCC, charged with executing and enforcing the provisions of the Communications Act, may not abdicate its responsibility to perform those duties and insure that the Act's standards are met, AT & T v. FCC, 572 F.2d 17, 25 (2d Cir.), cert. denied, 439 U.S. 875, 58 L. Ed. 2d 190, 99 S. Ct. 213 (1978), nor does it have "unfettered discretion to regulate or not to regulate common carrier services." Computer II, 693 F.2d at 212. But the public interest touchstone of the Communications Act, beyond question, permits the FCC to allow the marketplace to substitute for direct Commission regulation in appropriate circumstances. FCC v. WNCN Listeners Guild, 450 U.S. 582, 67 L. Ed. 2d 521, 101 S. Ct. 1266 (1981) (approving FCC reliance on market forces to promote diversity in entertainment programming). This court has several times so recognized. See, e.g., Computer II, 693 F.2d at 212 (citing with approval the holding of Western Union Telegraph Co. v. FCC, 674 F.2d 160 (2d Cir. 1982), that "newly unleashed market forces" constituted a reasonable substitute regulatory tool); National Association of Regulatory Utility Commissioners v. FCC, 525 F.2d 630, 645 (D.C. Cir.), cert. denied, 425 U.S. 992, 48 L. Ed. 2d 816, 96 S. Ct. 2203 (1976); see also Philadelphia Television Broadcasting Co. v. FCC, 123 U.S. App. D.C. 298, 359 F.2d 282 (D.C. Cir. 1966) (substituting Title III for Title II regulation is "rational and hence permissible"). The circumstances presented here do not render a role for market forces inappropriate.23 The Commission, after making essential public interest determinations, has taken a measured step. It has allowed some space for private ordering. It has not forsworn regulation or slighted its obligation to forecast where the public interest lies; and it stands ready to alter its course if future developments indicate that the public interest is not advanced by its decision.

Petitioners contend or predict that the FCC in fact will not review transponder sale applications with care to assure a sufficient remaining supply of common carrier transponders. See Wold Brief at 29-31; SSS Brief at 34-36; see also Brief for Intervenor MCI Communications Corp. at 8-9. But this court has no basis for concluding that the Commission is not proceeding, or does not intend to proceed, in the manner stated in the principal decision on review. The Commission has emphasized its commitment to scrutinize each request for non-common carrier transponder offerings to ensure the application's consistency with the public interest. Transponder Sales Order, 90 F.C.C.2d at 1255.24 It reaffirmed its transponder-by-transponder authorization policy in Western Union Telegraph Co., FCC 83-54 (released Feb. 9, 1983), reprinted in Brief for FCC and United States at B-1, and has stated guiding reasons for its approval of transponder sales applications. See Licensing Space Stations in the Domestic-Fixed Satellite Service, FCC 83-184 (released Aug. 16, 1983) at 40-42 (effect of granting the application on relative size of non-common carrier portion of satellite services market); Southern Pacific Satellite Co., 92 F.C.C.2d 666 (1982) (percentage of satellite's authorized in-orbit capacity proposed to be made available on a non-common carrier basis, and effect of granting the application on relative size of non-common carrier portion of satellite services market). The Commission has not stated a precise bright-line test, perhaps reflecting its concern that a simple comparison of the percentage of common carrier transponders with the percentage of non-common carrier transponders may not in every case satisfy the Commission's obligation to determine whether transponder sales certification is in the public interest. We expect that the Commission will in all cases seriously examine transponder sales applications in light of all factors relevant to the public interest calculus, and will monitor the results of the course it is pursuing.

B. Rational Decisionmaking

In determining whether the Commission reached its decision rationally, not arbitrarily or capriciously, this court's office is limited. We review the record to determine whether "the Commission has adequately explained the facts and policy concerns it relied on," whether "those facts have some basis in the record," and whether a reasonable person, considering the matter on the agency's table, could arrive at the judgment the agency made. Telocator Network of America v. FCC, 223 U.S. App. D.C. 336, 691 F.2d 525, 537 (D.C. Cir. 1982) (quoting NAACP v. FCC, 221 U.S. App. D.C. 44, 682 F.2d 993, 998 (D.C. Cir. 1982)).

Petitioner Satellite Syndicated Systems, Inc. asserts that "transponder sales are a radical departure from the existing policy and [therefore] the Commission must provide compelling justification for the change." SSS Brief at 10. This exaggerates both fact and law. The FCC recognized at the outset that, although it had issued space station authorizations before "not in the traditional common carrier mold," transponder sales did "represent a significant departure from the manner in which satellite service has generally been provided." Transponder Sales Order, 90 F.C.C.2d at 1247, 1248. "This is [therefore] not a case where an agency altered course without acknowledging or recognizing the change." Black Citizens for a Fair Media v. FCC, 231 U.S. App. D.C. 163, 719 F.2d 407, 417 (D.C. Cir. 1983). The Commission knew what it was doing and presented at length reasoned justification for its decision. See supra slip op. at pp. 1467-1473. A court cannot demand more if it is to respect the "broad discretion" Congress vested in the Commission "precisely to facilitate . . . modifications of administrative policies in light of developments" in an evolving industry. Office of Communications of the United Church of Christ v. FCC, 707 F.2d at 1425.

Petitioners further attempt to squeeze this case into the mold of Motor Vehicle Manufacturers Association v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 103 S. Ct. 2856, 77 L. Ed. 2d 443 (1983), by asserting that the Commission failed to examine "alternatives." Apart from the status quo, however, the petitioners fail to state sensibly what else the Commission should have considered. Nor is there evidence in the record that "alternatives" other than "no change" were suggested to the Commission. State Farm is therefore inapposite to the situation presented here.

The Commission's analysis of supply and demand is criticized heatedly by petitioners,25 but we find adequate support for it in the record. As earlier observed, see supra note 19, petitioners prefer the dated studies they cited26 to the more recent one credited by the Commission. It is not our role to second guess the FCC's plausible evaluation of these submissions. See National Broadcasting Co. v. United States, 319 U.S. 190, 224, 87 L. Ed. 1344, 63 S. Ct. 997 (1943).27

It is true that the FCC's discussion focuses less intensively on projected transponder demand than it does on transponder supply. The Commission, however, did not entirely neglect demand analysis. See Transponder Sales Order, 90 F.C.C.2d at 1250 n.28. Moreover, even if we accept petitioners' estimates of short-term demand, it appears that the supply of transponders will match that demand in the current decade. Compare id. at 1275 (Fogarty, Commissioner, dissenting) (projections of transponder demand), with id. at 1262-65 (opinion of the Commission) (expected transponder supply).

Petitioners fault the Commission for unduly emphasizing the future over the here and now; they charge that the FCC "fail[ed] to take note that the long lead planning time involved would indicate that satellites under construction now are of no use to customers who desire service now." SSS Brief at 7 (emphasis in original); see also Wold Brief at 17. This argument does not warrant overturning the Commission's decision. Petitioners themselves neglect to note that the majority of transponders whose sales the Transponder Sales Order authorized were on a satellite then "under construction," and thus were unrelated to "service now." Further, the Commission was well aware of "a three to five year lead time before [satellite systems can] become operational." Transponder Sales Order, 90 F.C.C.2d at 1250. Its opinion does not discuss at length immediate short-term impacts. Even in the short term, however, the Commission saw no danger that transponder sales would "drastically curtail the availability of transponders left for common carrier use." Id. at 1253. Reading the Commission's opinion as a whole, we find sufficient indication that the agency adequately considered short-term impacts and rationally concluded that the difficulties any moderate short-term dislocation presented would be outweighed by the long-term benefits of its authorizations. See id. at 1251-55.

Petitioners see caprice in the Commission's view that there is a benefit to the public in the risk sharing and flexible financing transponder sales permit. This incentive is not needed, petitioners urge, for despite the absence of transponder sales in the past, applications for authorization to construct and launch satellites have exceeded available orbital slots. See SSS Brief at 8-9; Wold Brief at 21-23. The FCC, however, took into account technological developments promising "substantial opportunities for expansion of satellite services and additional market entry," as well as prospects for increasing the orbital positions available for new satellites.28 Transponder Sales Order, 90 F.C.C.2d at 1254. Petitioners call the FCC's discussion "speculation." But the FCC's forecasts have support in the record;29 they are judgments of the very sort the Commission must make if it is to avoid governing tomorrow by standards shaped for yesterday. As the Supreme Court instructed this court:

The Commission's decisions must sometimes rest on judgment and prediction rather than pure factual determinations. In such cases complete factual support for the Commission's ultimate conclusions is not required since "a forecast of the direction in which future public interest lies necessarily involves deductions based on the expert knowledge of the agency."

FCC v. WNCN Listeners Guild, 450 U.S. 582, 594-95, 67 L. Ed. 2d 521, 101 S. Ct. 1266 (1981) (quoting FCC v. National Citizens Committee for Broadcasting, 436 U.S. 775, 814, 56 L. Ed. 2d 697, 98 S. Ct. 2096 (1978)); see also Office of Communication of the United Church of Christ v. FCC, 707 F.2d at 1435, 1437.30

Finally, we see no merit in petitioners' claim that the Commission neglected the problems of small cable systems. In addressing the impact of its action on small users, Transponder Sales Order, 90 F.C.C.2d at 1254-55, the FCC was guided by the comments of small and medium-sized users favoring transponder sales. See, e.g., Comments of Turner Broadcasting System, reprinted in J.A. 73-76 (medium-sized user with nationwide viewing audience). No small or medium-sized cable programmer appears in this court to complain about the Commission's decision; two -- Spanish International Network and Turner Broadcasting System -- appear in support of the Commission's decision.

HOLDING

Petitioners, in much of their argument, tell the court in many words that the FCC's decision is in their view "unwise, . . . not likely to succeed in accomplishing what the Commission intended." National Broadcasting Co. v. United States, 319 U.S. 190, 224, 87 L. Ed. 1344, 63 S. Ct. 997 (1943). The only response a reviewing court, mindful of its limited role, should give to arguments thus forecasting failure of the agency's design is that the complainants "have selected the wrong forum for such a plea." Id.31

The Commission's effort to serve the public interest in the matter at hand is adequately reasoned and within the broad charter Congress gave it. The orders on review are therefore

Affirmed.

CASE RESOLUTION

Affirmed.


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