The Justice Department antitrust division yesterday recommended to federal regulators that Communications Satellite Corp. be permitted to sell its services directly to the general public and the government.
At the same time, however, the antitrust division, in comments filed with the Federal Communications Commission, expressed strong disagreement with an FCC proposal to force Comsat to set up a separate subsidiary to prevent the Washington-based satellite concern from cross-subsidizing these new services with funds from its regulated tariffs.
Instead, the Justice Department proposed that the FCC permit independent ownership of earth stations and at the same time permit Comsat to charge customers separately for use of the company's satellite services.
The division's comments come at a critical time in an FCC rule-making proceeding which is considering whether restrictions on Comsat operations should be lifted to permit direct sales of retail satellite services to the public.
At the present time, Comsat cannot sell its services in competition with United States international service carriers, that is, major voice and data telecommunications companies such as American Telephone & Telegraph Co. and Western Union International Inc.
"Comsat's entry into the retail market and the provision of separate tariffs for satellite and for cable based on their respective costs as envisioned by the commission promise to bring substantial benefits to consumers of international communications services," the Justice Department said.
Further, the department said the proposal "will likely lead to substantial price reductions for international telecommunications services," could make the operations of Comsat and other communications concerns more efficient and could "spur innovation" in the field by permitting Comsat to market its services freely, rather than selling through middlemen.