THE WONKS SCRAMBLE
MARCH 15, 2000
ROOM 226, EISENHOWER EXECUTIVE OFFICE BUILDING,
WASHINGTON, D.C.
Institutional panic does not resemble human panic. When governments freak out, they do so by stages and in memoranda that begin with phrases like “Unfortunately” and “I am sorry to report” and “Based on the data we now have available.” They accumulate studies to justify the alarm, and then they pepper it with meetings at which functionaries gauge which part of the hysteria their agency should be responsible for, thereby to properly express anguish in proportion to the blame. The government panic over Iridium, if charted on an EKG, would resemble the Golden Gate Bridge, with huge spikes at the beginning and end of the year 2000, with periods of calm in between as the less frightened agencies relegated satellites to the cold-case file, and with lots of swaying in the wind as various cabinet secretaries switched sides, overreacted to media reports, and sent conflicting orders to their lieutenants. At the nerve center of all this activity, steady as a rock, was the resident of room 226 of the newly renamed Eisenhower Executive Office Building, directly west of the White House, the same room where Secretary Howard Taft had once run the War Department for Teddy Roosevelt. This was the domain of Dorothy Robyn.
Robyn specialized in sticky situations. She was known as a troubleshooter and a first-class negotiator who got things done with a combination of personal charm, white papers that “sing,” and a level of persistence that sometimes seemed supernatural. When word started circulating around Washington that a whole lot of satellites were about to be crashed into the ocean, she was the first to be notified in the form of a personal letter from a Motorola lawyer. She was puzzled—how did something go from technological marvel to orbital debris that fast?—but not overly so. The letter said that even though Craig McCaw decided not to invest, there were other bidders who might show up in a few days to rescue the constellation.
Meanwhile, the rest of the government was being alerted through a chain of events that began with a memo from an obscure bureaucrat in the State Department—Evan Bloom, Director of the Office of Ocean and Polar Affairs in the Bureau of Oceans, Environment and Science. Since Iridium was the only handheld phone that worked in the polar regions, Bloom had been the first to see the official Motorola warning, and he had placed a nervous call to Iridium headquarters in Reston, Virginia. Routed to company lawyer Tom Tuttle, Bloom was told that, yes, the destruction of the constellation had been ordered and would take about a year to complete. Bloom put that news into a memo, and a tsunami of disbelief coursed through the executive branch, eventually reaching the President himself. There were safety issues, there were commercial licensing issues, and, most important to the President, there was the issue of public pandemonium if satellites started falling out of the sky.
By March 15, 2000—the day of the bankruptcy hearing—Robyn was already ahead of the situation. Checking on the outcome of the hearing, she ended up talking to a Motorola systems engineer named Sam Fernandez, and he not only confirmed everything in Bloom’s memo but made it worse: the satellites would be coming down in three days! Surely he couldn’t be serious. Iridium had now turned into an instant crisis, so her instincts told her she had to go to the Pentagon. “When you’re looking for a government reason to intervene,” she would say later, “it’s gotta be a national security reason.” Robyn’s first job in Washington had been at the Office of Technology Assessment, which sorted out complex issues for Congress, and most of those issues involved the military. She knew the Department of Defense had already spent a lot of money on Iridium, so she dialed her best friend there: Lee Buchanan.
Buchanan was a physicist—a student, in fact, of Edward Teller—who had been head of DARPA’s Advanced Materials Office before becoming Assistant Secretary of the Navy. More important, Robyn considered him an intellectual soul mate, especially on the hot issue of “commercial/military integration.” The two of them had bonded during a trade mission to Japan to study the ceramics industry, and she knew he would think of Iridium as a golden opportunity to adapt civilian technology to military uses.
She was wrong.
“Don’t you guys use these phones?” she asked him.
Yes, said Buchanan, the military did use Iridium phones, but the feeling within the Building was that the system was worthless.
In fact, Buchanan added, the Joint Chiefs of Staff considered buying Iridium two months earlier for the equivalent of two cents on the dollar but turned it down as falling short of Pentagon requirements. The Navy was developing its own handheld satellite phone, called the “Mobile User Objective System.”
“Our requirements are that the phone work through a triple-canopy jungle in the rain, and Iridium can’t do that,” he said.
Triple-canopy jungle? How many U.S. Navy ships ply the waterways of the Amazon rain forest? Robyn wondered to herself but didn’t say anything.
“Besides,” said Buchanan, “we don’t want to depend on a commercial system.”33
Surprised by Buchanan’s pronouncement, Robyn thanked him for his comments and felt a sense of foreboding—this was going to be harder than she thought. Buchanan was no stovepiper—he was one of the good guys—so if he didn’t want the system . . . She went through her old Iridium phone list, searching for leads, but all her former contacts had left the company during recent bankruptcy proceedings. What was going on?
It was a communications system, so surely the FCC would be involved. Robyn placed a cold call there and—bingo!—discovered there were sixteen people working on “the Iridium problem.” An ad hoc crisis group had been formed, and now calls and memos were racing through the National Security Council, the FAA, the National Telecommunications and Information Administration, the White House legal office, and, oddly enough, the National Oceanic and Atmospheric Administration. As she sifted through the new information, Robyn noticed that a space policy briefing was scheduled for the next day in room 180. The meeting was for Neal Lane, the President’s science advisor, so she called Lane’s staff and asked if it would be possible to piggyback on that meeting to get the assembled experts’ views on Iridium.
Room 180 was well known to White House staff. This was the “secret Oval Office” outfitted by President Nixon so he could escape the West Wing. It was where the Watergate tapes were transcribed by Rose Mary Woods. It was now technically a working space for the Vice President, but it was more often used for impromptu meetings because it was so spacious. When Robyn arrived there, she discovered that the National Security Council had formed a committee of scientists, lawyers, and policy wonks to monitor Russia’s planned de-orbit of the Mir space station, scheduled to occur fourteen months hence. The committee members were now informed, many of them for the first time, that there was another de-orbit scheduled—a de-orbit that would happen in seventy-two hours! To say they were spooked was an understatement. Whereas the Mir would be the largest spacecraft ever to reenter the atmosphere, with a Progress M1-5 space freighter maneuvering it like a tugboat, the Iridium satellites would be tiny objects with nothing but onboard thrusters to lower the orbit before gravity took over. It would be like butterflies flipping around in a hailstorm—the “reentry scenarios” were infinite! Representatives from the Justice Department had already talked to Motorola and were somewhat shocked when the company seemed surprised by the government attention. During a six-hour meeting the Motorola representatives had continually pointed out that the Iridium system was privately owned, which the experts admitted was a unique situation, since none of them had ever been involved with a nongovernmental space system and they weren’t sure of the legal implications.
All they could agree on at first was that there was no precedent—and that it was scary. Very quickly they focused on trying to make sure the satellites landed on water, not land, and all agreed that it was desirable to “increase the probability that the satellites would reenter in the Southern Hemisphere.” The Southern Hemisphere had two advantages over the Northern Hemisphere: fewer people and less media interest. Could we hit the Southern Hemisphere? they asked the Motorola delegation. No one knew right away, so Motorola agreed to get back to the government the next day.34
The immediate result of the meeting was a decision simply to ask Motorola for more time. The government wanted to get an “independent hazard analysis” from NASA, and it also needed to check on Motorola’s insurance. A 1972 treaty required “launching states” to pay for damages caused by space debris. That meant the United States might be liable for the fifty-five Iridium satellites that had been launched from Vandenberg Air Force Base, even though they hadn’t been launched by the government. It was agreed that Motorola should be required to indemnify the government for that possibility prior to getting permission for the de-orbit.
Meanwhile, warnings went out from White House lawyers to White House staff: Whatever you do, don’t get involved with the actual bankruptcy issues. Limit everything to liability, safety, and government exposure.
Fortunately for the future of Iridium, Dorothy Robyn decided to ignore that particular warning. She felt there must be some way to get the system out of bankruptcy. Something about this didn’t smell right. She wanted to see the rest of the iceberg.
But that would take time. Motorola did agree to wait for the independent hazard analysis, and that would give her a month to search for legal loopholes. When that month ran out Motorola would still need two no-action letters—one from the Justice Department and one from the FCC—stating that the government was standing down. Quickly she mobilized a team to come up with reasons to delay those letters.
She soon found an ally in Mike Greenberger, the lead lawyer assigned to Iridium at the Justice Department, and Greenberger agreed to research “public nuisance” and pollution statutes that might be invoked. To do that he called in lawyers from the Environment and Natural Resources Division—the people who handled litigation involving the so-called Superfund sites. After all, wasn’t this the same principle? Was there that much difference between leaving PCBs in the soil of downtown Camden, New Jersey, and leaving out-of-control spacecraft in the exosphere? In both cases, you made a mess—and you couldn’t walk away, you had to clean up your mess first. More important, you were not the one who decided how your mess got cleaned up—the government was.
Robyn also found a kindred spirit in Kathy Brown, the FCC chief of staff. Soon the two of them were asking questions like “Do we know what foreign government satellites are at theoretical risk from colliding with Iridium satellites during a de-orbit?”—because that would be a hazardous situation that could delay Motorola. Brown conferenced in Chris Wright, the FCC’s top lawyer, and he agreed to start researching additional public safety statutes. Unfortunately, he had already found an Aerospace Corporation study that looked at Motorola’s de-orbit plan and pronounced it well within Pentagon guidelines—and those guidelines were, in any event, voluntary.
But media interest has a way of trumping the letter of the law, and on April 11, 2000, the New York Times business section featured a doomsday headline of the sort everyone had feared:
IRIDIUM, BANKRUPT, IS PLANNING A FIERY END
FOR ITS 88 SATELLITES
The number eighty-eight, like much information about Iridium, was a little misleading. There were sixty-six satellites in the working constellation, eight orbiting spares ready to replace any satellites that wore out, and fourteen dead satellites that had been launched but never made it into orbit, which meant they would return to Earth sometime between now and the twenty-second century. There were also four mass frequency simulators, better known as dummy satellites, that had been launched in Russia and China to test the ability of those countries to handle Iridium payloads. Those would crash to Earth on their own unpredictable schedule. And finally, there were four satellites in the Chandler Lab, where scientists tested software before uploading it to the constellation, and three half-built satellites stalled on the assembly line.
The Times article was primarily concerned with the financial woes of Iridium and Motorola, and it didn’t contain anything the White House didn’t already know, but the nuanced commentary was eclipsed by the words “fiery ending.” The article was immediately flagged by Leslie Batchelor, counsel to Attorney General Janet Reno, who sent out a mass e-mail quoting a single sentence:
“They expect to have some parts survive [reentry] because these are pretty big satellites.”
This statement was wrong. The Iridium satellites were not big at all. They were among the lightest satellites ever built. But it may have been that very factoid that saved the constellation, because the next day twenty-three people from eight agencies and departments were summoned to a meeting at the Justice Command Center of the Department of Justice Building for yet another “What the heck should we do?” meeting.
What was now being called the Iridium Interagency Working Group—the Mir space station could wait—had gathered to hear Nick Johnson, a scientist at the Johnson Space Center in Houston, present his risk assessment—and it didn’t go well. According to what Johnson had cobbled together from data supplied by Motorola and Aerospace, “the probability of someone being struck by surviving Iridium debris is assessed to be 1 in 18,405 per reentry and 1 in 249 for all 74 spacecraft combined.” One in 249 doesn’t sound like bad odds if your opponent is dealing to an inside straight, but in the world of government liability, it’s beyond horrible. (To indicate what an imprecise science this was, a memo sent out two days earlier by the Office of Science and Technology Policy had estimated the odds at 1 in 40 trillion.) So NASA had spoken—and the message was “This is bad.”
Based on the questions asked by the assembled experts, the working group started to resemble the city council of Amity Island, the fictional resort town in Jaws:
All the hedging was designed to avoid their greatest fear: that seventy-four satellites crashing at the same time would scare the hell out of the public. At the end of the day, Lieutenant Colonel Victor Villhard from the Office of Science and Technology Policy recommended that they emphasize statistics that didn’t sound that bad—for example, that in 1999 there were 433 entries into the atmosphere of man-made space debris, and 84 of those objects had a mass greater than an Iridium satellite. Probably best not to mention the scarier numbers: NASA was estimating that 380 pounds of fragments from each satellite would survive reentry and hit Earth’s surface at between 45 and 130 miles per hour.
As all hell broke loose in the wake of the New York Times article, Dorothy Robyn missed out on the initial panic because she was in Brussels, preoccupied with one of her periodic fights with “the Euros,” whose latest antics involved acting like jerks in a dispute over jet-engine noise standards. The day after the Iridium meeting, she taxied in from Dulles Airport, walked into her office, and saw a note taped to the seat of her office chair: “Call Gene!”
That sounded urgent, so she hurried over to chief economic advisor Gene Sperling’s office and listened to a strange story.
“What do you know about Iridium?” said Sperling.
She knew a lot about it, she told him. She was on top of it. Iridium was the first global cell phone. Iridium was such a huge leap forward in technology that it scared the bejeezus out of the FBI and caused the bureau to challenge the company’s license. Unfortunately Motorola had bungled the business plan and now they wanted to crash the constellation, but the FCC and Justice Department were already coming up with ways to stop them. Robyn had the equivalent of a graduate degree in Iridium.
“Jesse Jackson wants to buy the satellites,” Sperling told her.
Robyn had imagined many things that the President’s top economic advisor might say in this meeting, but this was not one of them.
The civil rights leader had just returned from a trade mission to Ghana, Nigeria, and South Africa with twenty-eight American businessmen, and those three African heads of state had apparently asked for help in bringing telephone service to remote villages. At least this is what Jackson said when he managed to get the ear of the President during a recent White House event, telling Clinton he had some African American investors who wanted to take over the bankrupt Iridium system and use it to provide phone service to sub-Saharan Africa. Jackson then sent a Rainbow/PUSH Coalition letter to Bill Kennard, the first black chairman of the FCC, asking him to deny Motorola permission to destroy the satellites: Check this situation out, get involved, see what can be done. Apparently we don’t have much time.
Robyn returned to her office, her head swimming with the policy implications. A few minutes later she was on the phone with a former FCC commissioner in private practice named Tyrone Brown, and Brown breathlessly informed her of his strange proposal. He represented “the Jesse Jackson group,” he said, and he had an amazing scheme to turn commercial bankruptcy into the greatest Third World communications project in history. His backers included Bob Johnson, head of the Black Entertainment Television network, and John Malone, the Colorado media mogul who frequently bankrolled Johnson’s ventures. Brown had a business plan, he told her. Brown and his people could save Iridium.
“What do you need from the White House?” she asked him.
“All I need is sixty days to raise $300 million,” he said. “Can you get me sixty days?”
Robyn said that yes, she thought she could. What she didn’t say was that the whole thing made her nervous, because these people were what were known at the White House as FOBs. The acronym stood for “Friends of Bill,” and one thing she didn’t need was the appearance of doing favors for the President’s cronies. “Ty Brown and Bob Johnson are the last people you want to be close to,” she recalled years later.
But this was all she had, so a few days later the FOBs were welcomed into her office. By then Ty Brown had coined the name “WorldTel” for his company, and “the Rainbow Coalition guys,” as Robyn was now calling them, were there to show her just how many other FOBs were likely to pile onto this project.
WorldTel’s plan for the dispossessed villages of the world was based around the concept of “teleboutiques,” and they were very similar to Ed Staiano’s plans for solar-powered phone booths in Chinese villages. These were kiosks outfitted with an Iridium phone and run by local “microenterprise” proprietors who would have a system of locating and informing recipients of incoming calls. Price per call would be about twenty cents per minute, which would require subsidies from governments and charities to get the consumer cost down to a dime. WorldTel, said Brown, would bring the Third World out of isolation from the world economy. In Kenya, for example, there were only 2,800 cell-phone subscribers in a nation of 32 million. In the largest African nation, Nigeria, you had 13,000 subscribers for a population of 150 million. New York City alone had more cell users than all of sub-Saharan Africa. In all these cases, the reason for lagging service was the lack of infrastructure.
Brown backed up his case with letters and testimonials from international aid organizations. C. Payne Lucas, president of Africare, had been appalled when Inmarsat charged him full price for a desperately needed phone in the Eritrean war zones of Ethiopia during the famine of 1998, and he was now throwing his full support behind WorldTel. Hamadoun I. Touré, director of the Telecommunication Development Bureau of the ITU in Geneva, had also met with Brown and pronounced himself thoroughly committed to the concept.
What both Robyn and Brown knew was that anything benefiting Africa was likely to make the President extremely happy. “‘Can we help poor people in Africa?’ was always a question being asked,” she said, “and not just on this issue. Clinton cared about Africa. He made many trips to Africa. Africa was always a priority.” More specifically, the goal of “universal dial tone” had been trumpeted by international aid organizations for three decades, and Africa—with a “teledensity” of one phone line per one hundred people—was ground zero for that battle. So everything about the WorldTel plan resonated deeply within the Clinton administration. FCC chairman Bill Kennard made regular speeches about the “global information infrastructure” and worked closely with Vice President Al Gore and others in search of worldwide “interconnectivity.” Kennard, Gore, and Hillary Clinton were constantly referring to the “global village,” using the term coined by Marshall McLuhan in 1960 but twisting it into a sort of social crusade for the dispossessed consumer. And the President himself had made a speech to the United Nations about people “literally disconnected from the global economy” because “more than half the world’s people are two days’ walk from a telephone.” In India there were five hundred million people with no access to a telephone. Iridium seemed, in many ways, like a deus ex machina solution to a long-standing problem. And it wasn’t just government agencies that believed this. “A phone in every village” was one of those feel-good ideas that materialized almost immediately after Motorola announced the Iridium de-orbit. Philanthropic and religious organizations got involved, online discussion groups were formed by brainy academics, and Sir Arthur Clarke himself even chimed in with a plan to convert Iridium receivers into “fixed solar powered/wind powered/clockwork community phones” for “getting the third-world rural poor into contact with the rest of the world.”35
Brown’s expansive presentation also promised a “political victory” for African governments that were too poor to build out cellular systems. This would be “a minority enterprise of epic proportion” that would require the cooperation of the UN, the World Bank, the Export-Import Bank, the Trade and Development Agency, the African Development Bank, and, of course, the Departments of State, Commerce, Treasury, and Transportation. Brown made it clear that Jesse Jackson was especially important to the deal because they would need him to get the monopoly telephone companies in the twenty targeted African nations to make “bulk minute commitments.” And it was a good time to be talking about Africa, since President Clinton was about to sign the Trade and Development Act, which was directed squarely at strengthening trade with the forty-eight countries of the sub-Sahara. Clinton was also planning a trip to Nigeria, so Brown was pushing for some kind of “deliverable”—an announcement, a deal, an agreement in principle—for the President to take with him.
Robyn promised Brown she would try “friendly persuasion” with Motorola to give the black entrepreneurs time to put their deal together. What she didn’t say was that much of what Brown said in her office that day had not only failed to wow her, but was positively frightening. All she saw were red flags, beginning with the constant references to a need for government aid. After the meeting Robyn sought a policy opinion from Will Gillespie, the industrial organization expert on the Council of Economic Advisors and, coincidentally, the resident White House science fiction buff. Gillespie’s response was fairly devastating: subsidizing Iridium would cost more than subsidizing terrestrial cell towers, and given the average GNP per capita of $510, “this plan makes no sense economically as a long-term development strategy for Africa.”
Still, Robyn thought it was all she had to work with at the time. “Only Iridium can deliver ‘universal telephony’ to sub-Saharan Africa,” she told Duncan Moore of the Office of Science and Technology Policy, trying to win the memo battle. “That’s why WorldTel would exist, and Jesse Jackson’s involvement would give them an advantage in dealing with African leaders. The President very much wants to bring telephony to sub-Saharan Africa. WorldTel would be in a position to do that. This is a unique situation and has to be seen as such.”
When Robyn told her boss about the meetings, Sperling responded with a quick note: “Good! Keep me posted. I’m not sure it will work, but it’s worth a closer look.” Two weeks later Sperling himself took a meeting with Black Entertainment Television owner Bob Johnson at the White House, and Johnson told him big money from cable TV magnate John Malone was waiting in the wings, but only if Malone could be assured of $5 million in monthly revenue. The implication was that Malone wanted the White House to bring in government aid groups that would make the project viable. And that was precisely the problem, Robyn told Sperling—the whole thing depended on handouts, not just from the United States but from a half-dozen international organizations, some of them based in Africa, all of them saddled with approval processes that took months, if not years. They needed a solution that worked now. They needed a market-based solution. Besides, doing something good for Africa was the kind of thing that might warm the heart of the President, but it had the potential to completely alienate the Department of Defense. “They’re very antagonistic toward anything that seems ‘off mission,’” she recalled. “They’re constantly asked to do things that are good for the planet but nonmilitary, so there’s a culture of ‘stick to your knitting.’ You can’t be portraying this as a project that has nothing to do with defense. They had spent $200 million on an Iridium gateway, indicating someone thought it was necessary to the military—that is what we had to emphasize. Bring up villages in Africa and you could start alienating people.”
For the present, all she could do was stall for time. International law was vague when it came to satellites that were owned by one country but launched by another, and this was causing underwriters longer than normal to write the insurance policy Motorola needed. Good, thought Robyn, the confusion could work to her advantage. Like a football coach preparing her game plan, she now had both a tactical offense and a tactical defense. Offense: Africa. Defense: Safety.
Sometime around the beginning of May, a new name showed up on her radar: Dan Colussy. In the course of talking to her Pentagon sources, she came across a Colonel Rick Skinner, who happened to be at Colussy’s “prekindergarten” Pentagon meeting, and he excitedly related that the “Stan Kapalla/Dan Colucci bid” by Polaris Corporation had been endorsed by Iridium management and was now “backed up by a number of former government folks.”
Robyn picked up the phone to find out the one thing she wanted to know from Colussy: How quickly can you put a deal together? Because by late April her delaying tactics were beginning to fail. “The FCC would have to stand on their heads to get Motorola to delay the de-orbiting,” she was told by Mike Greenberger at the Justice Department. “They’re spending a fortune to keep the satellites up, and there’s not really a legal peg for the FCC or the DOJ to make them delay. There’s no controlling legal authority for this. Although Motorola may think there is.” So Robyn’s strategy became: Okay, let’s let them think there is. That might give the Rainbow Coalition time to raise the $75 million they promised Gene Sperling they could raise, plus at least $200 million more from John Malone—or maybe this new Kaluchi guy would be able to do something.
Fortunately Motorola continued to have difficulties getting its de-orbit insurance in order—in fact, the London underwriters flat out refused to write the additional third-party liability coverage—and that delay had given Colussy time to get a Castle Harlan offer before the bankruptcy court. Help came from the Pentagon as well. Unless Motorola got additional insurance, NORAD was going to refuse to share real-time data during the de-orbit, for fear of government liability. Robyn pressed the military to go one step farther: her position was that there should be no government permission to de-orbit period until and unless Motorola did get the insurance.
Meanwhile, Ty Brown continued to call, saying that he was going in another fund-raising direction, this time through a D.C.-based media company called Syncom. The Syncom owners were trying to bring in their powerful friends—friends like Cleveland Christophe, head of Connecticut-based TSG Ventures, an African American investment firm. Brown also pitched Iridium to Navy veteran Maurice Tosé, chairman and founder of TeleCommunications Systems in Annapolis, which had been supplying various types of data services to government agencies since 1987. But Christophe and Tosé both had the same question: Was Bob Johnson investing? Bob Johnson was like a Bill Gates or a Warren Buffett among minority business owners, especially in the District of Columbia. If Johnson would come in on the deal, so would everyone else in the black community—but that was not to be. After Malone hesitated, Johnson phoned his friend Craig McCaw to ask him what he thought of Iridium, and McCaw told him it was “a Dumpster on a Mercedes engine.” It was an odd remark, since McCaw was still hinting that he wanted to get back into the game himself, but based on the dismissive remark, Johnson decided not to invest—and so did the other black millionaires.
One day Ty Brown called Robyn to say, “I don’t think it’s going well. I think the Dan Colussy group is ahead of us.”
Well then, she replied, maybe you should think about merging with the Dan Colussy group, right?
She was trying to force a shotgun wedding between the black D.C. liberals and the white Palm Beach conservatives. Like everything else in the convoluted history of the Iridium system, love for the satellites trumped race, gender, politics, conventional wisdom, and the way things had been done for a hundred years.