The legislation, crafted by Reps. Thomas J. Bliley, Jr., R-Va., and Edward J. Markey, D-MA, an unlikely paring of conservative and liberal, would give Intelsat and Inmarsat until 2001 to end the elements of their treaties with other nations and become public commodities. If Intelsat fails to make the conversion, Comsat and Intelsat would be prohibited from competing for public services, such as mobile telephony and Internet access. Comsat's U.S. customers would also get direct access to Intelsat, ending the current requirement that U.S. firms such as AT&T and Bell Atlantic go through Comsat first. Opponents of the measure say that it will destroy the Intelsat consortium and hinder the development of satellite services around the world.

Comsat has faced increased competition from PanAmsat Corp. and Loral in recent years, both of whom propose to develop communications satellite constellations. Comsat is the owner of nearly 20% of Intelsat, a global space treaty organization headquartered in Washington. The consortium owns a space satellite constellation that provides voice, data, and communications services to nations without other communications options. To date, 26 spacecraft form the Intelsat system.