The outline of U.S. policy on communications satellites was set by President Kennedy's public release on July 24, 1961, of recommendations of the National Aeronautics and Space Council, which invited all nations to join with the United States in a commercial satellite program. See Public Papers of the Presidents of the United States: John F. Kennedy, 1961, pages 529-531. One of the main objectives of promoting international cooperation was to forestall development of competing systems by the United States, the Soviet bloc, Western Europe, and others. Coordination of U.S. policy was handled by a special Subcommittee on Communications Satellites of the NSC Subcommittee on Communications. The special Subcommittee was established on January 28, 1963, with W. Michael Blumenthal as Chairman. (Memorandum from Orrick to Department of State Principals, January 28; National Archives and Records Administration, RG 59, IO Files: Lot 67 D 378, ITU)

Washington, July 21, 1962.

MEMORANDUM FOR
The Secretary of State
The Secretary of Defense

SUBJECT
DOD-State Concept for Communication between National Leaders

1. The May 25, 1962 memorandum for the President from the Deputy Secretary of Defense and its attachment, outlines a series of measures proposed by the Joint Chiefs of Staff to improve our means of maintaining communications with foreign national leaders during emergency conditions./2/ While recognizing that adjustments may be required as detailed planning and development progresses, the general concept in the Joint Chiefs of Staff's plan is approved for planning purposes.

2. All actions taken should be consistent both with planning for the National Military Command System (NMCS), which will be designed as the unified survivable national communications system, and with the integration of State-CIA communications facilities. Also, cognizance should be taken of studies presently under way in government which may lead to a proposal for improved communication links between the national leaders of the US and the USSR. All planning should be accomplished with the view that this additional requirement at some future date may be imposed upon the National Military Command System.

3. The Secretaries of State and Defense are requested to initiate planning based upon the proposed concept with the assistance of such other government agencies as may be required. The detailed plan with estimates of cost will be submitted to the President for approval prior to implementation.

McGeorge Bundy

Washington, October 4, 1962.

SUBJECT
U.S. Policy on the Organization of Global Satellite Communications

This memorandum, written in haste amid the usual distractions of a General Assembly, seeks to outline a U.S. position on the organization of an international satellite communications system-a position which will be needed in forthcoming talks with the United Kingdom and Canada and subsequently in consultations with other countries.

I. Objectives

The President's policy statement of July 24, 1961,/2/ Part D of the U.S.-sponsored General Assembly Resolution 1721 (XVI),/3/ the Communications Satellite Act of 1962,/4/ and other official statements have identified the basic objectives of U.S. policy in the field of satellite communications. For the purpose of this memorandum, the most important of these objectives are the following:

(1) To get a communications satellite system operating as soon as possible, for reasons of prestige and foreign policy;

(2) To realize the economic and technical benefits from this improvement in communications (more channels, intercontinental television, possibly lower costs);

(3) To achieve political gains resulting from increased international communication, including communication with Communist countries;

(4) To augment the economic development of less developed countries and our political relations with them by means of a global system which links low traffic areas as well as the main industrial countries;

(5) To make the most efficient use of the limited number of radio frequencies available for space communications as well as other communications.

II. The Central Question

One of the primary issues to be resolved at an early stage is whether there will be one global satellite communication system or several competing systems organized by the Communist Bloc, the Commonwealth and Europe, the U.S. and others./5/

All but the first of the five policy objectives outlined above argue for a single satellite system:

1. From the economic and technical point of view, satellite systems offer such a vast increase in the capacity for communications that it is doubtful that the capacity of several systems could be fully utilized in the foreseeable future. Moreover, several systems with different kinds of equipment would require the duplication of ground installations. Finally, the use of several systems would reduce the flexibility which one system offers for routing communications in the most efficient possible way. For all of these reasons, the establishment of several different systems might prejudice opportunities for substantial reductions in communications rates.

2. From the point of view of the political gains resulting from increased communications, a number of different systems would reduce the possibility for the worldwide exchange of programs. The opportunity to link the Soviet Bloc into a global communications network would be lost. There would be competition between the Soviet Bloc, the U.S., the Commonwealth and Europe to link less developed countries on an exclusive basis. United States access to certain less developed countries might thereby be lost.

3. From the point of view of our relations with less developed countries, a number of competing systems may result in uneconomic expansion in the communication facilities of certain politically favored countries and the neglecting of less favored ones. Instead of having access to all countries, the less developed countries will be "adopted" as members of more or less exclusive communications clubs.

4. From the point of view of the scarce frequency spectrum, several competing systems would be extremely wasteful and would be likely to get in the way of one another as well as other communication needs.

If, for all the reasons given above, we are to achieve a single international satellite system, this has important implications for U.S. policy. Our position on the host of organizational questions which arise in the establishment of a satellite system must be sufficiently attractive to other countries so as to dissuade them from establishing competing systems and to persuade them to join us in the establishment of a single network. If the U.S appears to be seeking a satellite network which is essentially U.S. owned and managed, there is little doubt but that the Soviet Union and the Commonwealth (possibly in conjunction with Western Europe) will develop their own self-centered satellite systems. Thus the devising of a genuine international arrangement with widespread participation in ownership and management is a prerequisite to the achievement of a single system.

There are at least two reasons why the U.S. should express its views now about establishing a genuine international arrangement:

In the first place, this will help foreclose the establishment of competing systems. The possibility of a Commonwealth satellite system is now under consideration. The forthcoming talks with the United Kingdom and Canada provide an important opportunity to influence Commonwealth policy. The same is true of any further discussions we may have with the Soviet Union either in the International Telecommunications Union (ITU) or pursuant to the Dryden-Blagonravov talks.

In the second place, this will help us secure the necessary frequency assignments for space communications at the International Telecommunications Union (ITU) conference in October 1963. Other countries will be more likely to accept a self-denying ordinance not to use certain frequencies for conventional communications (as well as reasonable ground rules for space communications) if they think they are "going to get something" through participation in an international arrangement on the basis of mutual benefit.

Bearing all these points in mind, there is nevertheless an outer limit to United States willingness to "internationalize" satellite communications. This limit is set primarily by our concern with the first objective mentioned above, namely, the achievement of an operating system as soon as possible. Multilateral participation in satellite communications must not be pressed to the point where it delays the establishment of the system. This could easily happen if American efforts in research and development were held back by an excessive "farming out" of tasks to other countries or if negotiations bogged down in political controversy. Moreover, the United States domestic satellite corporation will be unwilling to invest the necessary financial and human resources if the international arrangements prove unacceptable.

The central question, therefore, is to develop a satellite arrangement which is "international" enough to assure foreign participation in a single enterprise and yet which safeguards the U.S. position sufficiently to assure rapid progress and vigorous participation by the U.S. corporation. It may turn out that an arrangement achieving both these purposes is not capable of achievement, but we have the obligation to try.

III. Policy Issues

In reality, there are not simply the two alternatives of a United States system versus an international system. There is a whole spectrum of conceivable arrangements between the two extremes. The variety of arrangements can be seen only when we have identified the principal questions which may call for international negotiations. A summary of these questions follows:

1. Research and development. Is the United States to do all the research and development, or is this to be "farmed out" to the Commonwealth, the Europeans and the Soviet Bloc on some basis of comparative advantage?

2. Manufacture. Is the United States to manufacture all of the components of the system (ground equipment, satellites, boosters) or are foreign countries to participate?

3. Launch. Is the United States to launch all the satellites, or is the Soviet Union (and eventually Europe) to launch some of the satellites?

4. System design. To what extent is the type of system to be employed (e.g., Telstar versus Syncom) to be determined unilaterally by the United States or on the basis of agreement with other countries? (This decision has important consequences for foreign interests: Syncom means cheaper and simpler ground installations, and thus less burdens on the less developed countries; Telstar offers greater opportunities for frequency-sharing.)

5. Global coverage. How rapidly and to what extent is there to be global coverage of low traffic areas?

1. Investment. Who is to contribute, and on what basis, to the cost of the satellite portion of the system? (The cost of constructing and launching the satellites accounts for over half the cost of the satellite system.)

2. Revenue sharing. Who is to share, and on what basis, in the revenue to be attributed to the satellite portion of the system?

3. Control. Who is to allocate the voice channels in the satellites to different uses (e.g., 600 telephone channels versus one TV channel)? Who is to allocate the channels as between different countries capable of using them at the same time? Who is to determine when satellite service is to be discontinued or when satellites are to be replaced?

C. General operating problems./6/

1. Rate-making. How are rates to be established? Is there to be a unitary rate system, i.e. one rate between any two points of the system, regardless of the volume of traffic (a subsidy to communication with low traffic areas)? Will rate-making policy take into account the desire to protect existing investment in cables? Will the emphasis be on relatively high rates to recoup existing investment quickly, or on relatively low rates with a view to the long-term elasticity of demand and the political benefits of increased communication? How will decision-making on these various subjects be shared as between participants in the system?

2. Technical ground rules. How will technical compatibility of different system components be assured (e.g. between ground stations and satellites and between different satellites where manufacturing has been done in different countries)? What ground rules with respect to non-interference and cooperation will be required and how will they be enforced? For example, what collective sanctions might be undertaken to deal with countries seeking a "free ride" on the system?

1. Ownership. Who is to own (invest in, derive revenue from, control) the ground stations?

2. Location. Who is to determine the location of a ground terminal in a region where only one is economically justified? (Quite apart from advantages in terms of prestige and technology, the location of a ground terminal in a specific country enables that country to "black-out" its neighbors from the global system for political and military purposes.)

E. Questions relating to assistance to less developed countries.

1. The construction of ground terminals. Who is to pay for (and supervise the construction of) ground installations in less developed countries which lack the financial and other means to construct them?

2. Operating ground terminals. Who is to supply the personnel (or train indigenous personnel) to operate the ground terminals in less developed countries?

3. Assistance to internal communications. Who is to supply technical assistance and capital aid to develop the internal communications networks of less developed countries to the point where they can be meaningfully linked into the satellite system?

F. Public uses of the system.

1. National information activities. Will the USIA, Moscow Radio and other national institutions be permitted to use the system for broadcasts serving national political objectives? Will they pay the commercial rate or a specially low rate?

2. United Nations. Will the United Nations and its Specialized Agencies be permitted to use the system? Will they pay the commercial rate or will they be given a specially low rate? (During the experimental phase of another year or two the UN will be using Telstar without charge to broadcast its proceedings, but what happens afterwards?)

G. Questions relating to broadcasting.

1. The exchange of broadcasts between nations. What agreements will be made as to the dissemination of foreign broadcasts on national networks?

2. Control of content. Will there be any restrictions whatever on the content of programs that are sent out by means of the system? (See, e.g., the Soviet proposal to outlaw "war propaganda in outer space".)

IV. Institutional Alternatives

As noted earlier, the choice is not simply between a "U.S. system" and an "international" system. The various questions outlined above are susceptible to a wide variety of answers--answers which represent--many points in the spectrum between the "U.S." and "international" extremes. As a practical matter, however, certain extreme possibilities can be eliminated at the outset. For example, no one seriously advocates United States domination of the entire satellite system, since it is generally agreed that foreign countries will want to own and operate the ground stations located on their territories. On the other extreme, no one seriously advocates establishing a United Nations agency in which management of the system would be shared on the basis of one country, one vote.

As a practical matter, there are three principal institutional alternatives for dealing with the questions listed above:

A. A "United States-controlled" system. One possible alternative would be a system which, for want of a better name, could be described as "United States controlled." Foreign countries would own and manage the ground stations in their territories. The ground stations in the United States would be owned and managed either by the U.S. corporation itself or by the common carriers. But the satellites would be owned by the U.S. corporation. The U.S. corporation, under government regulation, would carry on the research and development; would determine the most satisfactory system to be established and the extent to which it would be global; would control procurement of system components; and would arrange for launching with the U.S. Government. It would put up the money for the manufacture and launch of the satellites; would collect the revenue attributable to them; and would control the allocation of the voice channels by renting them out to different users in the U.S. and abroad. For the most part, questions of rate making and technical ground rules would be negotiated bilaterally with individual foreign countries linked into the system, although some of these questions might be discussed in the ITU. The construction of ground terminals in less developed countries and capital aid to these countries would be the responsibility mainly of the U.S. corporation and the United States Government.

B. International system: functional approach. This is not really one alternative but a group of alternatives. The approach would be unilateral, bilateral, regional and multilateral (through the ITU or elsewhere) in accordance with the particular functional problem. Ownership would be shared, either on an undivided basis (each country would have a percentage share in all the satellites) or on a divided basis (each country would own particular satellites which might finance, manufacture or launch). The allocation of channels as between uses and users might be carried out bilaterally and regionally for particular satellites at particular times. The decision as to the allocation of ground stations in a particular region might be left to the countries of the region. Questions of technical and financial assistance might be taken up in institutions such as UN Expanded Program of Technical Assistance (ETAP), the Special Fund, International Development Association (IDA) or the Organization for Economic Cooperation and Development (OECD).

C. International system: corporate approach. Under this alternative, there would be an international institution to handle most of the specific problems enumerated in Section III. Since U.S. participation will be in the form of a private corporation, an inter-governmental agency would not be desirable. Instead, there would be created an international corporation on the model of Eurochemic, the European company established for the processing of chemical fuels. Eurochemic was chartered by the Organization for European Economic Cooperation (OEEC), but its shares are held by governments and private firms. An international satellite corporation could be established on the same model. Its charter could be worked out through inter-governmental negotiations either in the ITU or elsewhere. Some of the shares of the corporation would be held by the United States satellite corporation. The remainder of the shares would be held by foreign public corporations such as the British Post Office or foreign government departments as in the case of the Soviet Union. A small Board of Directors would make fundamental management decisions, but there could be periodic meetings of all interested governments to review the operations of the corporation and make general recommendations. The latter function might be served by the ITU Plenipotentiary Conference. Voting in the Board of Directors could be based in part on financial contribution, in part on use of the system, and in part on other criteria which would give some voice to small and less developed countries. Under any rational formula, the United States would have at least one-third to two-fifths of the votes and would have a majority in conjunction with its European allies. For political reasons qualifying majorities might be necessary to safeguard what the Soviet Union and other countries might regard as fundamental interests.

The difficulties with all three of these alternatives are readily apparent. Alternative A is almost certainly destined to produce competing systems from the Soviet Bloc and the European-Commonwealth group. Alternative C poses political and organizational problems of great difficulty. In the present political climate, it is not easy to imagine an effective working relationship on the Board of Directors between Soviet and American representatives. Alternative B, for all its advantages of flexibility, may fail to provide an adequate structure for an efficient international approach.

V. Future Strategy

The choice between the three principal alternatives outlined above is of great importance. All of its implications will not be clear until we know more about the technical details of the system. It is obvious that we cannot commit ourselves to any institutional design at this early date. There are, however, some things that can be done in our conversations with other countries even at this stage:

1. We can impress other countries with our technical superiority in satellite communications and our determination to press ahead with the speediest development of the system. This will strengthen our bargaining power.

2. We can say that we desire a single commercial system rather than competing systems. We can cite all the reasons given in Part II of this memorandum and emphasize that these are not just matters of U.S. interest but of interest to all countries.

3. We can say that we favor a truly international system, with foreign participation in ownership and management of the satellites as well as in ownership of ground stations in other countries.

4. We can spell out the major questions which will have to be decided in the years ahead along the lines of Part III above and invite an exchange of views as to different ways of dealing with them.

5. We can outline alternatives B and C--the functional approach and the corporate approach--while indicating that the United States has not reached a decision between them.

These above points should be the major themes in our conversations with the United Kingdom and Canada and with other countries in the months ahead. Points 1 through 4 should also be outlined in our speeches on outer space at the current United Nations General Assembly and in the report to the International Telecommunications Union which we are requested to submit by December 31.

Washington, October 25, 1962.

RE
Your Directive Concerning Improvements in the U.S. World-wide Communications Capabilities

1. At a meeting called by Mr. Bundy and Secretary McNamara, a National Communications Systems Working Group was created. The members are to be: W.H. Orrick, Jr., Department of State (Chairman); Admiral William Irvin, Department of Defense (Vice Chairman); [less than 1 line of source text not declassified] CIA; Dr. Irvin Stewart, OEP, Special Assistant to the President for Telecommunications; and Dr. David Robinson, OST Staff (Observer).

2. The committee was given the following tasks:

a. On the highest urgency make plans for correcting communication deficiencies to Latin America, with particular emphasis on the needs of CINCCARIB.

b. Make a comprehensive survey of requirements of government agencies and a survey of available facilities.

c. To plan an integrated national communications facility to meet these needs.

3. A task force concerned with communications in the [less than 1 line of source text not declassified] area has made a preliminary survey of communications needs and additional facilities required to meet them for CINCCARIB and for general DOD, State and CIA communications to [less than 1 line of source text not declassified] countries and is attempting to do the following:

a. Increase the circuit capability from the U.S. to Panama. Several techniques are being explored, including the crash installation of a tropospheric scatter system, additional commercial facilities and the expedition of a planned submarine cable to Panama. Because of CINCCARIB's requirements, this project has the highest priority.

b. Mr. McCone has directed augmented staffing of the CIA communications centers in Latin America. The CIA and DOD are undertaking to provide the necessary manpower.

c. The State Department has prepared a resolution on communications, recommending that member states of the OAS cooperate to strengthen their communications capabilities by entering into bilateral and other arrangements. A draft copy of the resolution is being forwarded to our Ambassadors to Latin America with the request that they consult local governments regarding the resolution. It is hoped that the resolution could be acted upon in the very near future and pave the way for the introduction of additional communication equipment, particularly by the Department of Defense. A draft copy of the resolution and a circular for our Ambassadors is attached./2/

d. The Department of Defense has located equipment which can be air transported if needed once agreements permitting its use have been obtained.

e. A survey is being made of the availability of additional commercial service to the U.S. embassies in the area.

4. The National Communications Systems Working Group is beginning a review of U.S. Government requirements on a worldwide scale. In parallel they will also survey the existing facilities and attempt to plan needed corrective measures. It is hoped that a preliminary report will be available for Mr. McNamara and Mr. Bundy on Friday, October 26. The group has organized five regional subcommittees on Africa, Latin America, Europe, the Near East and South Asia, and the Far East and Pacific, with members from DOD, State Department and CIA. The assignment sheet for regional subcommittees is attached./3/

5. It is generally agreed the most serious deficiencies in the communications systems are lack of integration and the fact that the State-CIA net has not been planned to meet crisis loads. It is our understanding of the present assignment that the facilities are to be modified and augmented so that it will be adequate for peak loads. This will involve the introduction of additional equipment and staffs at numerous points around the world. We are proceeding on the understanding that this is your desire.

JB Wiesner

Washington, October 25, 1962, 8:03 p.m.

760. For Ambassador from Martin. President has directed that most urgent action be taken improve US communications facilities particularly in American Republics area. Numerous and serious communications shortcomings encountered last several days prior President's statement on Cuba demonstrate unequivocal, immediate, and continuous need for effective overt US Govt-controlled radio communications system with facilities in each ARA country.

Request you immediately seek from Fonmin, or higher level, oral agreement in principle to necessity for such radio communications system (in light its crucial importance to hemispheric cooperation and defense) and willingness of Govt to which you accredited to explore with us immediately means for putting it into effect. FYI. If necessary, pursuant to recently enacted legislation US Govt prepared consider granting radio operations privileges in Washington, D.C.

Reply urgently by cable giving your estimate time required for conclusion successful negotiations.

Rusk

Washington, October 26, 1962.

TO
The Vice President
The Secretary of State
The Secretary of Defense
The Secretary of the Treasury
The Attorney General
The Chairman, Joint Chiefs of Staff
The Director of Central Intelligence
The Under Secretary of State
The Deputy Secretary of Defense
The Ambassador at Large
The Special Counsel to the President
The Acting Director, U.S. Information Agency
The Director, National Security Agency
The Administrator, National Aeronautics and Space Administration
Chairman, Federal Communications Commission
Administrator, Federal Aviation Agency
Administrator, General Services Administration
Director, Office of Emergency Planning
Assistant Secretary of Defense (International Security Affairs)
The Counselor of the Department of State

SUBJECT
Establishment of Subcommittee on Communications

There is hereby established a Subcommittee on Communications of the Executive Committee of the National Security Council. It shall be the responsibility of this subcommittee, under the direction of the Executive Committee, to ensure the establishment of a national communications system which will make the worldwide communications available to the United States Government as prompt, reliable, and secure as possible. The President has designated William H. Orrick, Jr., Deputy Under Secretary of State for Administration, to be Chairman of this subcommittee. Mr. Orrick will take whatever action is necessary to eliminate deficiencies which presently exist. He will look to all agencies for prompt and immediate support. He will have as Vice Chairman an officer designated by the Secretary of Defense, who shall be the representative of the Department of Defense, who has undertaken to give particular support to the pursuit of this objective.

In this task, Mr. Orrick should consult with and secure the cooperation of other departments, agencies, and the public sector as appropriate, drawing to the extent necessary upon the work done by the Emergency Planning Committee under NSAM 127./2/ By copy of this memorandum, other agencies are instructed to cooperate with Mr. Orrick in this mission to the fullest extent. If Mr. Orrick encounters difficulties or resistance, he will report at once to the President.

McGeorge Bundy

Washington, March 11, 1963.

SUBJECT
Space Communications

I was stunned yesterday to overhear Dick's comments which suggested that the State Department is on top of space communications like NASA is on top of SYNCOM; or maybe it's worse, since NASA at least has a pretty good idea of where SYNCOM is.

Can it possibly be that the Department of State still thinks that "science" is a peculiar branch of metaphysics on which the Secretary should be "advised" from time to time--that outer space is beyond the pale of politics--that international telecommunications has no more to do with international relations than has IT&T in Brazil--that a global satellite communications system will somehow be fathered by the FCC out of the Space Council with Edward R. Murrow serving as Godfather?

After the flap last year about "peaceful uses" (muted only by the hullabaloo of the Cuban crisis); after dashing up to the Hill to testify that the communications satellite bill fully protected the foreign policy interests of the United States (a highly dubious proposition); and after publicly, formally and explicitly stating a U.S. policy commitment to a truly universal satellite communications system managed by a truly international organization (which was followed up so effectively that the British appear to be far gone toward a decision to establish a Commonwealth satellite system)--I should have thought that the State Department at long last would have taken charge of this subject.

At the risk of being accused of empire-building, don't you think IO should now move in and take the responsibility? After all, whatever else it is, this is a problem in international organization.

London, May 8, 1963, 6 p.m.

4429. Deptel 5888./2/ Substance report contained reftel confirmed by FonOff source (Hope-Jones). In extremely frank discussion on current developments in space communications Hope-Jones indicated the following:

1. There has been considerable pulling and hauling among European countries as to how to proceed in space communications. FonOff has been attempting take the lead in organizing European countries to focus on this question. Unfortunately Cabinet indecision led to delays and in end French seized initiative. As result first meeting will be held at invitation of French in Paris at Ambassadorial level on May 20. British Minister in Paris, Sir Algernon Rumbold, will head UK Delegation which will include Hope-Jones, Sir Robert Harvey and MOA representatives. The British were successful in arranging for a second meeting at Ministerial level to be held in London in July.

2. French wish primary point on Paris agenda to be "forms of European cooperation" but British have indicated they intend enlarge scope this item to include general international concept of space communications since obvious some understanding on this point must be reached prior to discussion of European forms of cooperation. Other agenda items include (A) machinery for handling space communications matters between European countries on both industry and government levels; (Hope-Jones indicated UK plans propose standing committee as initial inter-governmental organization until clearer idea obtained as to type international organization required.) (B) relations with the UN; (C) relations with under-developed countries, and (D) provision of guidance to CEPT.

3. UK expects Paris meeting will identify problems and determine general scope of substantive statement to be presented US following July meeting. During July meeting governments will present positions on points developed during Paris discussion and presumably agree on details of statement.

4. With respect to CEPT European governments concerned with implications of CEPT questionnaire and presumably have decided against sending questionnaire to US. Hope-Jones implied that hereafter CEPT discussions and actions will be directed by governments. This has apparently generated considerable adverse reaction on part GPO and PTT administrations. GPO has informed FonOff that US Communications Satellite Corporation taking over responsibility for international dealings involving space communications and State Department activities in this area are phasing out. On basis this report GPO attempting persuade HMG that there is no need for FonOff involvement since matters can now be resolved between technical administrations, i.e. GPO, PTT and Communications Satellite Corporation. (Department may wish comment on this.)

5. Hope-Jones said there was some feeling in Europe that French were trying to dominate European space communications scene. French are reported to have indicated they would go into cooperative arrangement with US on space communications only for limited period of five years "to learn the business" and then withdraw to form independent system. When asked with whom the French could establish independent system, Hope-Jones replied presumably there would always be specific links which might lie outside the main axis of a global system, e.g. France-Africa.

6. In conclusion Hope-Jones stated FonOff position favoring single global system substantially represents UK posture today but, at instigation MOA, UK is keeping as alternative course possibility of independent system in event global system advocated by US did not permit UK adequate opportunity to participate in all phases.

Comment: In view Hope-Jones' frankness and sensitivity of this material, Department requested protect source. UK position for Paris meeting on May 20 expected to be formulated end next week. Embassy will attempt learn substance and report.

Bruce

Paris, undated.

CONFERENCE ON SATELLITE COMMUNICATIONS--
PARIS, MAY 20-21, 1963

Resolution adopted by the Conference

The preliminary consensus of view of the Conference is that satellite communications should be organized on an international basis in such a way as to enable European countries:

(a) to participate in the design of the system

(b) to share in the ownership of the system

(c) to play a full part in the management of the system

(d) to have an opportunity, as the system is expanded and developed, to provide satellites, launchers and other necessary equipment, for inclusion in the system

The Conference requests the British and French Authorities to bring to the attention of the United States Authorities, on behalf of the whole Conference, this summary of the views expressed during the first session of the Conference held at Paris on May 20 and 21. The Conference emphasizes the importance it attaches to the views of the American Authorities on these principles being made known in time for them to be considered by the Conference in London in mid-July.

The Conference also thinks it necessary for the American Authorities to be informed of the interest it has in the enquiries which the CEPT ad hoc Committee is to make for its part.

The Conference also invites the Governments represented at the present Meeting to submit papers expanding their views on these subjects in time for the London Meeting.

Washington, May 21, 1963.

SUBJECT
Final Report of the Sub-committee on Communications

Submitted herewith (Tab A)/2/ is the final report the Sub-committee on Communications of the Executive Committee of the National Security Council. This Sub-committee was established by National Security Action Memorandum No. 201 of October 26, 1962, which stated that "It shall be the responsibility of this subcommittee, under the direction of the Executive Committee, to ensure the establishment of a national communications system which will make the worldwide communications available to the United States Government as prompt, reliable, and secure as possible."/3/

For several weeks following the issuance of NSAM No. 201, the Sub-committee met in continuous session. The initial phase of its activities was concerned with an appraisal in detail of existing communications facilities, an identification of major deficiencies, and the issuance of directives for the expeditious carrying out of the required improvements. The Sub-committee then turned its attention to an intensive examination of ways in which longer-range improvements could be achieved through the upgrading of existing facilities or new installations.

The Sub-committee's decisions and objectives were embodied for the most part in the form of "action directives," and 125 such directives were issued. Within a relatively short time substantial progress was realized with respect to solving some complicated technical, administrative and diplomatic problems. As of this date, 97 of the actions requested have been completed. Thus, 78 percent of the specific measures directed by the Sub-committee have been taken. Most of the remaining directives involve actions which are not scheduled for completion until later in 1963 or in 1964.

Particularly noteworthy is the marked improvement brought about in the facilities for communicating with Latin America, the lack of which loomed so large in the crisis that gave rise to the establishment of the Sub-committee. In Latin America, and at most key posts in other areas, a 24-hour, seven-days-a-week communications response capability is now in being. "On-line" cryptographic equipment has been installed, or planned, for all major diplomatic missions and will result in providing more rapid, reliable and secure communications. Slower, but measurable progress has been witnessed in the construction of the European and Trans-Mediterranean tropospheric scatter systems, as well as in communications improvements in other areas of the world.

Programs for improving relay and switching centers at key points throughout the world have been initiated. Major steps have also been taken to improve radio transmitting equipment and to obtain, where necessary, transmitting rights for US embassies in foreign countries so that improved communications or emergency back-up facilities will be available. Under the auspices of the NSC Sub-committee a special working group has completed a study of the potential impact of the communications satellites on a national communications system. In addition, the following basic reports resulting from Sub-committee directives have been completed: (1) acceptability of certain "off-line" cryptographic systems, (2) physical and technical security problems and precautions, and (3) manpower requirements resulting from the actions of the NSC Sub-committee.

Secure communications facilities among top officials in Washington have been expanded and studies have been completed for the installation of still more sophisticated equipment. The Department of State message precedence system has been revised to ensure conformity with that employed by the Department of Defense and CIA.

The work of the Sub-committee, briefly summarized above, is described in more detail in the enclosed Final Report.

There remain a few problems of major importance to be solved:

(1) The extent to which separate Defense, State or CIA communications centers at Foreign Service posts abroad can be consolidated or centralized;

(2) Budget planning for and financing of the national communications system; and,

(3) The question of "privacy," which includes the need for a thorough review of the present systems for allocation of available circuits to various governmental users.

These issues are discussed at greater length on pages 13-14 of Tab A.

The most pressing immediate requirement, however, is to proceed with the creation of a permanent organizational framework for a national communications system, upon which the solution of these remaining major problems depends. To provide for such a framework, a draft National Security Action Memorandum is enclosed (Tab B). This memorandum proposes the designation of the Director of Telecommunications Management as Special Assistant to the President for Telecommunications and of the Secretary of Defense as Executive Agent for the NCS, each with specific responsibilities as set forth therein.

The Sub-committee urges strongly that the Action Memorandum be approved at the earliest possible date.

The Sub-committee notes that the position of Director of Telecommunications Management is now vacant. The Sub-committee is unanimously of the opinion that the issuance of the above-mentioned Action Memorandum need not, and should not, await the filling of the above position. Moreover, it recommends that every effort be made to fill this vacancy at the earliest possible date to permit the newly designated Special Assistant to the President for Telecommunications to assume his responsibilities expeditiously.

The Sub-committee is in disagreement on one point. Three participants/4/ recommend that the Sub-committee on Communications continue in existence to give policy direction to the NCS until the future Special Assistant to the President for Telecommunications notifies the Sub-committee that he is ready to assume his responsibilities. This majority recommendation stems from the following considerations: (1) NSAM No. 201 placed responsibility on the Sub-committee to ensure the establishment of an NCS; (2) a serious gap in the organizational structure of such a system would initially result if the Sub-committee is dissolved before a Special Assistant to the President is appointed; (3) the functions of the Sub-committee would not, therefore, be wholly fulfilled; and (4) in any event, the Sub-committee could serve a useful purpose in the interim as a means through which over-all policy guidance could be obtained, and as a forum to air any interagency differences which might arise.

Two members/5/ consider that, with the issuance of the Action Memorandum, the Sub-committee should be dissolved. This view is set forth in the enclosed statement of the Vice Chairman, Lt. General Starbird (Tab C).

William H. Orrick, Jr.
Chairman

Washington June 26, 1963.

AIDE-MEMOIRE

On June 12, 1963, the British Embassy and the Embassy of the French Republic delivered to the Department of State a copy of a Resolution adopted by the Conference on Satellite Communications held in Paris on May 20-21, 1963, requesting, on behalf of the Conference, the written views of the United States on the principles set forth in the Resolution.

The United States Government is pleased to have the opportunity to state that it shares the view of the Conference set forth in the Resolution that commercial satellite communications should be organized on an international basis in such a way as to enable European countries to participate in the design, ownership and management of the system and, in addition, to provide, as the system is expanded and developed, satellites, launchers and other equipment for inclusion in the system. It is noted that the same considerations would also apply to other participants.

Believing that additional information may be of use to the countries participating in the Satellite Communications Conference to be held in London in July, the United States Government offers the following additional comments:

Persuasive technical, economic and political considerations indicate that commercial communications satellites should be planned, developed and operated on the basis of a single global system. The concept of a single global system for commercial purposes contemplates that the organization of the system will be such that all parties are engaged in a single coordinated effort to provide global communications and that competition for traffic through independently established or managed systems be avoided. The technological development of the single system will be evolutionary.

In the interest of efficient and expeditious establishment of an operational system, the original participants should be those countries or regions having the desire and the means to make significant economic and technical contributions to the development and use of the system. The original participants should, however, acknowledge the goal to be global coverage and, while recognizing that there will be differing modes of participation, should adopt the principle of non-discriminatory access to the system by all countries or regions wishing to participate.

Although most of the traffic in the early stages will be within the Atlantic and Far Eastern areas, the initial operating system should permit service to be provided at some points in all major geographical areas of the world.

This Government would expect that the voice of participants in questions of management, finance, technology, operations and supply will be related to capital invested and use of the system, recognizing, however, that all participants should be able to make appropriate contributions to such decisions.

The United States Government considers that such financial assistance to the developing nations as may be required to bring their communications system to a point permitting meaningful participation in the global system would be the responsibility of national and international sources of capital assistance and not of the entities participating in the satellite system in their capacity as such. The responsibility in this connection of such participating entities would extend only to assuring, on an equitable basis, the opportunity for future participation by such nations.

An identical aide-memoire has been delivered this day to the Embassy of the French Republic.

Washington, undated.

TO
The Vice President
The Secretary of State
The Secretary of Defense
The Secretary of the Treasury
The Attorney General
The Director of Central Intelligence
The Director, U.S. Information Agency
The Administrator, National Aeronautics and Space Administration
The Chairman, Federal Communications Commission
The Administrator, Federal Aviation Agency
The Administrator of General Services
The Director, Bureau of the Budget
The Director, Office of Emergency Planning
The Director, Office of Science and Technology
The Director of Telecommunications Management

SUBJECT
Establishment of the National Communications System

In furtherance of the general objectives stated in NSAM 201, dated October 26, 1962,/2/ a National Communications System (NCS) shall be established and developed by linking together, improving, and extending on an evolutionary basis the communications facilities and components of the various Federal agencies. The organizational arrangements set forth in NSAM 201 are superseded by those established in this memorandum.

The objective of the NCS will be to provide necessary communications for the Federal Government under all conditions ranging from a normal situation to national emergencies and international crises, including nuclear attack. The system will be developed and operated to be responsive to the variety of needs of the national command and user agencies and be capable of meeting priority requirements under emergency or war conditions through use of reserve capacity and additional private facilities. The NCS will also provide the necessary combinations of hardness, mobility, and circuit redundancy to obtain survivability of essential communications in all circumstances.

Initial emphasis in developing the NCS will be on meeting the most critical needs for communications in national security programs, particularly to overseas areas. As rapidly as is consistent with meeting critical needs, other Government needs will be examined and satisfied, as warranted, in the context of the NCS. The extent and character of the system require careful consideration in light of the priorities of need, the benefits to be obtained, and the costs involved.

Although no complete definition of the NCS can be made in advance of design studies and evolution in practice, it is generally conceived that the NCS would be comprised primarily of the long haul, point-to-point, trunk communications which can serve one or more agencies.

The President has directed the following organizational arrangements relating to the establishment and effective operation of the NCS.

In carrying out his functions pursuant to Executive Orders 10705 and 10995/3/ and under this memorandum, the Director of Telecommunications Management shall be responsible for policy direction of the development and operation of a National Communications System. In this capacity, he shall also serve as a Special Assistant to the President for Telecommunications and shall:

a. Advise with respect to communication requirements to be supplied through the NCS; the responsibilities of the agencies in implementing and utilizing the NCS; the guidance to be given to the Secretary of Defense as Executive Agent for the NCS with respect to the design and operation of the NCS; and the adequacy of system designs developed by the Executive Agent to provide, on a priority basis and under varying conditions of emergency, communications to the users of the NCS.

b. Identify those requirements unique to the needs of the Presidency.

c. Formulate and issue to the Executive Agent guidance as to the relative priorities of requirements.

d. Exercise review and surveillance of actions to insure compliance with policy determinations and guidance.

e. Ensure that there is adequate planning to meet future needs of the NCS.

f. Assist the President with respect to his coordinating and other functions under the Communications Satellite Act of 1962 as may be specified by Executive Order or otherwise.

In performing these functions, the Special Assistant to the President for Telecommunications will work closely with the Special Assistant to the President for National Security Affairs; he will consult with the Director of the Office of Science and Technology and the Director of the Bureau of the Budget, as appropriate; will establish arrangements for inter-agency consultation to ensure that the NCS will meet the essential needs of all Government agencies; and will be responsible for carrying on the work of the Subcommittee on Communications of the Executive Committee of the National Security Council which is hereby abolished. In addition to staff regularly assigned, he is authorized to arrange for the assignment of communications and other specialists from any agency by detail or temporary assignment.

The Bureau of the Budget, in consultation with the Special Assistant to the President for Telecommunications, the Executive Agent and the Administrator of General Services, will prescribe general guidelines and procedures for reviewing the financing of the NCS within the budgetary process and for preparation of budget estimates by the participating agencies.

To obtain the benefits of unified technical planning and operations, a single Executive Agent for the NCS is necessary. The President has designated the Secretary of Defense to serve in this capacity. He shall:

a. Design, for the approval of the President, the NCS, taking into consideration the communication needs and resources of all Federal agencies.

b. Develop plans for fulfilling approved requirements and priority determinations, and recommend assignments of implementation responsibilities to user agencies.

c. Assist the user agencies and the General Services Administrator with respect to the Federal Telecommunications System to accomplish their respective undertakings in the development and operation of the system.

d. Allocate, reallocate, and arrange for restoration of communications facilities to authorized users based on approved requirements and priorities.

e. Develop operational plans and provide operational guidance with respect to all elements of the NCS, including (1) the prescription of standards and practices as to operation, maintenance, and installation; (2) the maintenance of necessary records to ensure effective utilization of the NCS; (3) the request of assignment of radio frequencies for the NCS; (4) the monitoring of frequency utilization; and (5) the exercise and test of system effectiveness.

f. Within general policy guidance, carry on long-range planning to ensure the NCS meets future Government needs, especially in the national security area, and conduct and coordinate research and development in support of the NCS to ensure that the NCS reflects advancements in the art of communications.

Within the framework of the NCS, the Executive Agent will provide for the requirements for survivable communications of the President and civilian agencies. A statement of such requirements is set forth in the report of the Task Group on Survivable Communications Requirements of the President and Top Civil Leaders, dated August 20, 1962/4/ which is approved for planning purposes.

The Secretary of Defense may delegate these functions within the Department of Defense subject at all times to his direction, authority, and control. In carrying out his responsibilities for design, development and operation of the NCS, the Secretary will make appropriate arrangements for participation of staff of other agencies.

The Federal Telecommunications System, established with the approval of the President under authority of the Federal Property and Administrative Services Act of 1949, as amended, to provide communications services to certain agencies in the Fifty States, the Commonwealth of Puerto Rico and the Virgin Islands, shall be a part of the NCS and shall be implemented and developed in accordance with approved plans and policies developed pursuant to this memorandum. The Executive Agent and the Administrator of General Services shall be responsible for establishing arrangements to avoid duplication in requests for cost, traffic, and other information needed from agencies served by the FTS.

Nothing contained herein shall affect the responsibilities of the Administrator of General Services under the Federal Property and Administrative Services Act of 1949, as amended, with respect to the representation of agencies in negotiations with carriers and in proceedings before Federal and state regulatory bodies; prescription of policies and methods of procurement; and the procurement either directly or by delegation of authority to other agencies of public utility communications services.

All agencies are directed by the President to cooperate with and assist the Special Assistant to the President for Telecommunications, the Executive Agent, and the Administrator of General Services in the performance of the functions set forth above.

McGeorge Bundy

Washington, July 15, 1963.

Dear Dean:

Recently, the Joint Chiefs of Staff forwarded for my approval a Master Plan for the National Military Command System (NMCS) designed to improve the responsiveness of the NMCS to National Command Authorities. Copies are attached./2/ I have approved the Master Plan for planning purposes and implementation, as appropriate, within the Department of Defense.

National Security Action Memorandum No. 166 of 25 June 1962/3/ requires that the NMCS form the basis of a system to serve the needs of the President and the top civilian leaders as well as those of the Department of Defense over a spectrum of emergency conditions. To fulfill this assignment, you will note that the Master Plan provides for participation by Department of State personnel in the activities of the National Military Command Center and the alternate command centers. Our proposal is to test this arrangement initially in the National Military Command Center and in the alternates on land and at sea. Later we plan to expand the arrangement to include the National Emergency Airborne Command Post. In addition, the Plan proposes that the Department of Defense provide representation in the Department of State Operations Center.

I am also attaching a draft State-Defense Agreement recommended by the Joint Chiefs of Staff pertaining to this exchange of personnel which I understand was worked out informally with your people./4/ If the proposed Agreement meets with your approval, we will take the necessary steps to put it in final form and obtain formal Department of State authentication. We are in the process of negotiating similar agreements for participation in the activities of the command centers by representatives of the Director of Central Intelligence and the Director of the Office of Emergency Planning.

Subsequent to securing your approval of the proposed State-Defense Agreement, and approval by other agencies of agreements, as appropriate, I propose to promulgate the Master Plan as a Department of Defense directive. In this regard, I welcome your comments on the Plan as it pertains to the Department of State.

Response at your earliest convenience would be greatly appreciated.

Sincerely,

Bob

Washington, August 21, 1963.

SUBJECT
Establishment of the National Communications System

The President has directed the establishment of a National Communications System (NCS) to provide better communications support to critical functions of government. Attachment I advises the Heads of Departments and Agencies of this action and designates the Director of Telecommunications Management as Special Assistant to the President for Telecommunications to advise and assist him with respect to communications requirements and plans for the NCS./2/

The President has further directed that on an interim basis his Special Assistant for Science and Technology shall perform the functions assigned to the Director of Telecommunications Management concerning the establishment of a National Communications System./3/

McGeorge Bundy/4/

A-587

New York, November 8, 1963.

SUBJECT
Outer Space

1. Jean D'Arcy, Director of Radio and Visual Services Division, of the UN Office of Public Information, and former Director of Eurovision, feels that the USSR is not alone in its apparent fear about direct broadcasting from communications satellites to the home receiver, further that the technology in this field is more advanced than commonly realized, even with regard to TV signals.

2. D'Arcy had just returned from the ITU Conference in Geneva at which it was decided not to go into the question of direct broadcasting. The French position, which he said was dictated by the Quai d'Orsay, was to call for a prohibition of direct broadcasting from satellites. D'Arcy talked with members of the French Delegation but was unable to find precisely what lay behind this position other than that it was political in nature. He was convinced, however, that the French would find strong support if they switched to a more reasonable position which requested study of the question.

3. D'Arcy felt that many of the less developed states, who lacked conventional transmission facilities outside of major urban centers, were properly fearful of the ability of the space powers to communicate directly to their citizens. For example, one of the Indonesian representatives at the Geneva Conference had said that it would be intolerable if President Kennedy used a communication satellite to speak directly to large numbers of Indonesians to whom President Sukarno wished to speak but could not for lack of conventional facilities. D'Arcy thought that similar considerations lay behind the Brazilian favor for UN censorship over the content of mass media relayed by satellite. A country like Brazil, or for that matter the USSR, might never find it economically feasible to develop conventional transmission facilities sufficient to provide coverage throughout the entire country. Thus, at such time as satellites have a direct TV transmission capability, the situation would arise in which an outside state could develop an audience which was denied to the television studios within that country.

4. D'Arcy noted that when Eurovision was being established it was thought of principally in terms of its usefulness for those states whose television facilities were highly developed, i.e., France, Germany and Great Britain. But in actual fact the countries which today make greatest use of Eurovision are just the opposite, namely those who, because they are less developed, are greatly in need of program content. Today Eurovision programs are only rarely seen in the most developed states because they have their own programming. D'Arcy foresaw a similar trend in space. He could imagine the situation in which many countries would be forced to rely in large part on programs beamed via satellite. Countries unable to satisfy audience demand by local programming would in effect be open to propaganda and commercial advertising by outside states, thus opening up long-term domestic and economic effects beyond their control.

5. On the basis of conversations with Americans active in the communications field, D'Arcy was convinced that there were no serious obstacles to direct radio broadcasts from satellites in the immediate future, and that it was probably only a matter of time before there could be direct TV transmission to home receivers. Although the technology might never be attractive from an economic point of view, its mere exist-ence created the fear that major powers like the US might decide on its employment for political reasons. It was this possibility which D'Arcy felt is of real concern to many representatives who attended the ITU Conference.

6. D'Arcy said it seemed clear to him that the ITU was not the forum in which to consider what is essentially a non-technical problem. He therefore hoped that the US was giving thought to its consideration in the context of the Outer Space Committee of the General Assembly. He said he would welcome further discussion on this topic.

Stevenson

Washington, November 22, 1963.

SUBJECT
Establishment of Intergovernmental Agency for Satellite Communications

At Mr. Gardner's request, Jim Simsarian accompanied Mr. Chayes and Mr. Carter to a meeting with Mr. Welch, Mr. Charyk, Mr. Throop and Mr. Cutler of Communications Satellite Corporation yesterday afternoon.

The following significant decisions were reached in principle:

1. We will go ahead with the negotiation and establishment of an intergovernmental agreement to set up an intergovernmental agency on satellite communications.

2. We will try to have a caucus with the Europeans in Europe in early January 1964.

3. We will propose convening an interim intergovernmental conference in February or March 1964 in the United States with Europeans plus a representative group of other countries (including Japan, Canada, Australia) to complete and sign an intergovernmental agreement to set up a provisional intergovernmental agency on satellite communications. This would be an executive agreement and only an interim arrangement pending the completion of an intergovernmental convention later which would be submitted to the Senate for approval. However, the interim agency would go ahead in the meanwhile with the financing and establishment of a communications satellite system. The date of the interim conference will depend upon the date of issue of the Corporation stock in early 1964.

4. We contemplate convening an intergovernmental conference to draft and complete an intergovernmental convention in September 1964 (or later, depending on developments). This convention would be submitted to the Senate for approval.

Mr. Chayes presented the State Department position very well, and in the light of talks that Mr. Welch and Mr. Charyk have had in Europe, they agreed along the above lines. However, agreement was in principle, and these points have to be pinned down.

Mr. Throop and Mr. Cutler are preparing a CSC draft of an agreement to be negotiated with other countries (we hope it is in terms of negotiations with other countries rather than Postal Administrations). We are hoping to see this soon. In the meanwhile, Mr. Chayes believes we should be lining up our own views in the Department of State on organizational issues.

Accordingly, at the request of Mr. Gardner, Jim Simsarian has prepared the attached draft which he is discussing with Mr. Carter and Mr. Chayes and others in Legal./2/ Jim's draft includes the principles set forth in earlier CSC proposals, a General Assembly and Administrative Council suggested by the CSC, and the CSC as Managing Firm of the new intergovernmental agency (at least in its interim stage). The draft is in terms of a provisional arrangement pending a more detailed convention to be prepared at the later intergovernmental conference. We need a draft agreed in the Department of State, with other agencies and the Corporation before the end of December for purposes of discussion (at least in terms of principles) with the Europeans at our proposed meeting in early January. This is a tight schedule, but because of the proposed early stock issue and other pressures on the Corporation, we will have to move ahead quickly both here and in negotiations with other countries.

Jim's draft is based on the structure of the World Bank and EUROCHEMIC in Europe; the Europeans have repeatedly urged the establishment of an agency structured along these lines.

Washington, December 4, 1963.

SUBJECT
Communication Satellites--Report of Plenary Meeting of European Conference on Satellite Communication, Rome, November 26-29, 1963

The Third Plenary Meeting of the European Conference on Satellite Communication reached a number of important decisions, summarized below.

1. Cables vs. Satellites. The Conference discussed this question at length. The Europeans seemed to feel that for them it is an either-or choice in terms of providing the circuits necessary to meet anticipated traffic in the period of 1965-67. They are far from satisfied that satellites should be chosen over cables. The Conference authorized their Telecommunications Committee to invite officials of the American Telephone and Telegraph Company to an intensive discussion of the relative merits of cables and satellites to be held in Bonn on January 13. The Conference will also inform the United States Government of the meeting in order that we may send officials of appropriate agencies, to attend together with the AT&T representatives. The interested bureaus of the Department are in agreement that representatives of the Communications Satellite Corporation, the Federal Communications Commission, and the Department should attend the meeting.

It is important that the Corporation, the Government, and the AT&T be in complete agreement on the positions to be adopted in the meeting. It may be desirable for you and other Executive Branch officials to meet with AT&T officials in the near future.

2. European Organization. It was agreed that the 19 countries participating in the Conference should form a new regional organization, in a corporate form, to be the European partner of the United States Communications Satellite Corporation in a global system of communication satellites. The Conference declared itself to be the provisional European organization. The primary organizational questions not yet resolved are:

(a) Whether the commercial organization (to be formed by treaty) should have a regularly constituted governmental supervisory council to deal with "political" questions in addition to its regular board of directors.

(b) Whether voting on "political" questions should be weighted in proportion to investment of each participating country or be on a one-country-one-voice basis. It is agreed that on commercial questions voting should be weighted in direct proportion to investment.

The Organizational Committee of the Conference will attempt to solve these problems at meetings to be held in the coming months.

3. Discussions and Negotiations with the United States. The Conference decided to invite the Governments of the United States and Canada to an exploratory meeting to be held in Rome the first week in February. The purpose of the meeting will be to determine if a basis for agreement exists between Europe and North America and to plan the terms of reference of a first negotiating conference to be held in March or April with the view toward concluding provisional intergovernmental agreements permitting progress to be made in the design, installation and operation of an initial system.

A cooperative attitude on the part of the Europeans was reflected in their willingness to accede to the timetable proposed by the United States.

It is anticipated that a formal negotiating conference to conclude a multilateral treaty providing a framework for a permanent organization will be held in the fall of 1964. The Europeans are agreeable that both the formal conference and the conference to agree on provisional arrangements be held in the United States if we so desire.

4. Industrial Participation by the European Countries in the Global System. On the one hand, the Europeans are most anxious to be in a position to make the maximum industrial and technical contribution to the global system. As they are considerably behind the United States in this field there is a tendency for them to attempt to delay implementation of an operational system to give them time to catch up. On the other hand, they also recognize the desirability, as a general political objective, of participating from the beginning in the structuring and management of a global system.

The really difficult area concerning industrial participation is their desire to provide launching services. Here, they are very far behind the United States and yet this is the "big money" in the field. Negotiations in this area will be difficult.