It’s hard to find a more loyal customer for U.S. satellites than Telesat Canada. In the past 30 years, this unit of BCE Inc. has bought 14 birds, all from south of the border. But in March the Ottawa company announced it was buying a spacecraft from France’s Astrium. After gaining experience with the new gear, Telesat will be less likely to return to U.S. suppliers: “It’s very much easier to buy a second and a third,” notes Roger J. Tinley, Telesat’s vice-president for space systems.



What caused the shift? The inability of Congress to distinguish between an aircraft carrier and a TV satellite. In 1998, lawmakers put satellites on the State Dept.’s munitions list alongside traditional weapons, imposing the strictest export standards. Licensing, monitoring, and notifying Congress of each export deal may work for selling fighters to foreign governments but doesn’t fly in the commercial world. “It’s very difficult to do business with U.S. companies,” Tinley gripes.

“We are jeopardizing America’s dominance of the satellite industry,” declares Representative Dana Rohrabacher (R-Calif.), who backed the 1998 rules but now has second thoughts.



The iron law of unintended consequences is clearly at work. A policy designed to deprive America’s potential enemies of advanced spying and communications technology while protecting America’s hardware edge has been ruinous on both counts. The barriers to U.S. sales have spurred rivals overseas to offer a variety of satellite services, so any adversaries can easily buy imaging and communications services elsewhere. And by making U.S. companies less attractive suppliers, the rules crippled an industry the Pentagon wants to rely on for space-based radar and lasers. The industry’s “foundations are being eaten away,” says Loral Chairman and CEO Bernard L. Schwartz.
More here.