Should Intelsat and Inmarsat privatize?

Regulatory, technological and economic changes are now challenging the logic of maintaining a preference for organizations, such as Intelsat and Inmarsat, created by intergovernmental agreement, granted privileges and immunities and partially insulated from competition. Intelsat and Inmarsat enjoy opportunities perhaps to prevent or blunt the impact of intramodal competition, ie market entry by other enterprises providing service via the same medium (satellites). On the other hand, the cooperative structure established by intergovernmental agreement has achieved global connectivity via satellite at rates averaged over dense and sparse routes. This Comment examines whether privatizing Intelsat and Inmarsat will stimulate efficiency and enhance consumer welfare, or impose higher costs without significant benefits.