Beep… beep… beep. The first sounds of the space race stunned Americans in the days after the launch of Sputnik 1 on October 4, 1957. More than 40 years later, Americans endured the stunning sound of silence when a different kind of beeping stopped.
When PanAmSat’s Galaxy IV satellite failed in 1998, it was the worst outage in the history of communications satellites. About 90% of all pagers in the US went dead. Hundreds of TV channels had nothing to broadcast but dead air. The Weather Channel's satellite images were interrupted, as were pay-at-the-pump services at many gas stations. Forty years after the Soviets laid claim to the first artificial satellite, our lives have become dependent on these high-flying birds.
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Sputnik’s signal faded after 18 days, but its influence on our way of life remains stronger than ever. (Image and sound clip courtesy of NASA)
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The number of ways we use satellites may be limited only by the number of satellites we can put in orbit. Today, the 500 or so active satellites circling the globe deliver our TV and radio programs, let us talk to each other halfway around the world, and may soon be our gateway to faster Internet service. Traders from Tokyo to London to New York make transactions every day via satellite, while government orbiters beam down pictures of Earth from space for weather forecasters. Even global positioning systems, once a province of the military, are available, via satellite, to weekend warriors.
Of course, the commercialization of space was the last thing on President Eisenhower’s mind as the 184-pound spikey sphere cruised over the American heartland. Sputnik 1 proved that the Soviets had the ability to launch long-range ballistic missiles, and for years that thinking dominated the newly born Space Race and the Cold War. By January 1958, the US launched its first satellite, Explorer 1. That same year, Eisenhower formed NASA. The first US communications satellite (AT&T’s Echo 1) and the first US weather satellite (NASA’s TIROS 1), followed in 1960.
One of Sputnik's immediate impacts was on US education. Fearing that the Russians were far ahead in science, the US increased funding for scholarships and scientific equipment for schools, and required students to spend more time on math and chemistry – that is, when they weren’t hiding under their desks. Little did they know at the time that the "duck and cover" drill would do little more than provide nostalgic footage for A&E’s History Channel and Viacom’s Nick at Nite.
A generation of scientists came of age to fill the employment ranks of Boeing, Lockheed Martin, Northrop Grumman, and dozens of other defense contractors that built spy satellites, nuclear warheads, and the rockets to launch them. But even as aerospace and defense industry jobs nourished communities across the country, entertainment and instant information proved to be the satellite’s true calling. In 1962, the first satellite phone call took place between AT&T’s board chairman and Vice President Lyndon Johnson through the company’s TelStar satellite. By 1964, Americans were watching the Summer Olympics from Tokyo via satellite.
But the satellite business was risky and unprofitable in its early days. To be successful, satellites needed help from the government (maybe that’s what that first phone call was about). Enter INTELSAT, an international consortium created in 1964 by the US and 17 other countries to operate the world’s first global satellite network, and COMSAT, the heavily regulated US company that sells overseas satellite links through INTELSAT to American long-distance carriers, broadcasters, multinational corporations – even to the US government.
By the mid-1970s, satellites were beaming television into our homes. In 1975, Time Inc.'s HBO, the first pay-TV service, began to distribute programming to cable affiliates via satellite. ESPN followed in 1979, CNN in 1980. Before the decade was out, CNN would broadcast live footage of the fall of the Berlin Wall. Sputnik seemed a distant memory.
With the Cold War over, companies in the defense industry were forced to sink or swim. Long-time defense contractors ditched their swords in favor of a share of the growing satellite market. Loral Space & Communications, once a leader in defense and aerospace manufacturing, now derives about 85% of its revenues from satellite systems. Hughes Electronics Corporation owns satellite TV provider DirecTV and 81% of PanAmSat, whose 19 satellites form the world’s largest private communications satellite network.
With the commercial satellite business much less choppy than it once was, the government is getting out of the way. Lockheed Martin bought 49% of COMSAT in September 1999 and a bill before Congress would end COMSAT’s monopoly and let Lockheed buy the rest. INTELSAT’s days also may be numbered. Faced with the 1998 deregulation of the satellite industry by the World Trade Organization (WTO), INTELSAT spun off part of its network as New Skies N.V. to compete in the already-crowded commercial satellite market.
The race is on to fill the sky with satellites and sell their services. Though now bankrupt, Motorola’s Iridium was the first to launch a mobile communications satellite network in 1998. In 2000, Loral’s GlobalStar system will begin offering a similar worldwide phone and paging service through a 48-satellite network. Broadband Internet access via satellite could become a reality early in the next century through Hughes’ Spaceway system – scheduled to begin service in 2002 – or the Teledesic network, backed by Bill Gates and cellular pioneer Craig McCaw and scheduled to begin service in 2004.
Kevin Dodds is editorial production director for Hoover's Online and a writer for the Trade & Consumer team.
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