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Washington, D.C. The subcommittee met, pursuant to recess, at 10 a.m., in room 2247, Rayburn Office Building, Hon. Chet Holifield (chairman of the subcommittee) presiding.

Present: Representative Chet Holifield.

Also present: Herbert Roback, staff administrator; Douglas G. Dahlin, counsel; Paul Ridgely, investigator; and Joseph Luman, defense analyst.

Mr. HOLIFIELD. The committee will be in order.

We will continue our hearings on the communications satellite problem.

Our first witness this morning is Mr. C. C. Duncan, assistant vice president of the American Telephone & Telegraph Co.

You may proceed, Mr. Duncan.
Will you introduce your companion for the record ?

Mr. DUNCAN. This is Mr. George Ashley, who is our general attorney, Long Lines Department, American Telephone & Telegraph.

Mr. HOLIFIELD. Thank you.



Mr. DUNCAN. Mr. Chairman and members of the subcommittee, my name is C. C. Duncan. I am assistant vice president, overseas operations, of the Long Lines Department of the American Telephone & Telegraph Co. I am responsible for the planning and provision of all types of overseas communications facilities required to serve the Bell System customers and for the day-to-day operation and maintenance of those facilities. I have also been general manager of special projects, chief engineer, and director of the operating staff in the Long Lines Department.

On April 9, 1964, Mr. James R. Rae of our organization appeared before this committee and discussed the work that the Bell System had done in the development of satellite communications and set forth its views at that time with respect to the use of satellite circuits. I will try to avoid going over the same ground, but I will cover our present global communications including those provided for the Government, what we anticipate in the future, and how we expect to use satellites in providing our service.

I think the committee is generally aware of the communications services provided by the Bell System in the continental United States. These include local telephone service, long-distance service, teletypewriter exchange service, various private line services such as private line telephone and teletypewriter, data, video, and audio services. Many of these are furnished in conjunction with the more than 2,500 independent telephone companies in this country.

In the international field we furnish telephone service between the United States and practically every country in the world. In addition to circuits to Alaska, Canada, and Mexico, we have 1,185 direct telephone message circuits to 78 overseas countries and territories. Of these, 65 are satellite circuits, 810 cable circuits, 206 high-frequency radio circuits, and 104 tropospheric scatter radio circuits. In addition to the 78 countries that are reached directly from the United States, connections are made on a switched basis to 113 other countries.

Last year, we handled approximately 8 million overseas telephone messages, an increase of 25 percent over the previous year.

We do not operate in any foreign countries. We furnish these services in cooperation with our overseas correspondents. The provision and cost of the facilities required and the revenue therefrom are generally shared equally between us.

The Federal Government is the Bell System's largest customer and uses all of the types of services which we provide the public generally. We also provide a number of special switched networks for the Government such as Autovon and the Federal Telecommunications System and such highly sophisticated communications systems as the Ballistic Missile Early Warning System and the Joint Chiefs of Staff Alerting Network.

Since the U.S. Government orders service at thousands of locations, we do not, on a continuing basis, have available total billing figures for its services. However, early this year we undertook as a special project an estimate of the total billing of the Bell Telephone Cos. for service to the U.S. Government for 1965. This study indicates that services furnished to the U.S. Government amounted to about $303 million or about 2.7 percent of our total operating revenues of $11 billion. Of the $303 million, $186 million was to the Department of Defense.

I have attached to my statement a brief summary, marked exhibit A, of some of the more important special services which the Bell System provides to the U.S. Government.

In the overseas field, we are providing 46 voice only, 44 voice-data, and 3 teletypewriter private line circuits for Government use. Ex: hibit B attached hereto gives the geographical distribution of these circuits and identifies the particular Government agency to which they are furnished.

I realize the committee is particularly interested in satellite communications. At present, none of the private line services I have described is provided by satellite.

With the expansion of satellite facilities in the next few years and availability of service 24 hours a day, we plan to use satellite circuits across the Pacific to Japan, the Philippines, Australia, and the Asiatic mainland, to South America and Africa, and to increase appreciably the number of satellite circuits used to Europe. We are also studying plans for use of satellites for domestic communications.

While it is expected that a substantial portion of overseas communications growth will be handled using satellite circuits, we believe that there is also a need for additional cable facilities and that there will continue to be a field of use for tropospheric scatter and high-frequency radio circuits.

We estimate that 3,225 satellite circuits will be required by 1980 for our overseas business. This estimate is set forth in detail in exhibit C attached. Parenthetically, I might say this information was furnished to the Federal Communications Commission on June 15, 1966.

We expect to add transistorized cables of 720-circuit capacity between the mainland of the United States and St. Thomas, Europe, and Hawaii in the next few years. Other cables of lesser capacity will probably be required to other areas. Also, preliminary development work is now underway on cables with capacities of up to 2,300 circuits.

The extent to which A.T. & T. itself will be able to use satellite circuits and other facilities for overseas services for the Defense Department and other Government agencies is restricted by the decision of the Federal Communications Commission prohibiting our future offering of alternate voice-data service to overseas points with the exception of Hawaii. Because of that decision and because we do not offer service originating in Hawaii, except to the U.S. mainland, we were not asked to bid on the provision of the 30 circuits from Hawaii to Japan, to the Philippines, and to Thailand. Therefore, we are not directly involved in that controversy.

When Mr. Rae testified before this committeo in 1964 he reviewed the Bell System's extensive contributions to the development of satellite technology and our plans for the use of satellite circuits. The plans which I have just reviewed show that our interest is a continuing

We have a substantial investment in the Communications Satellite Corp. We are by far the largest user of satellite circuits to date, and we expect to continue to be the largest user. Furthermore, the satellite system must be coordinated with, and interconnected with, terrestrial facilities and we must work very closely with the Satellite Corp. to achieve an efficient overall result.

We do feel very strongly that Comsat was created and given the very special position it holds to be primarily a common carrier's carrier. In other words, its function is to provide physical facilities to the carriers who have the responsibility for the overall service from customer to customer. We, therefore, are in general agreement with the decision of the Federal Communications Commission in the authorized user matter. Certainly the disruptive effects of Comsat's dealing directly with an ultimate customer, when the established carrier seeking the same business-must go to Comsat for the facilities, is such that the requirements of a showing of "unique and exceptional circumstances" is warranted.


In conclusion, I would like to assure the committee that we in the Bell System are determined to move forward with the use of satellites as well as other media to keep this country in the forefront of world communications.

Thank you very much for this opportunity to appear before the subcommittee.

(Exhibits A, B, and C, submitted by Mr. Duncan, follow :)




The JCSAN is a worldwide network from the Joint Chiefs to all specified and unified commands. With this network the Joint Chiefs have immediate contact with commanders in chief and the commanders of the specified commands such as the Strategic Air Command around the world.

2. BALLISTIC MISSILE EARLY WARNING SYSTEM (BMEWS) The BMEWS connects three forward high-powered radar sites at Clear, Alaska, Thule, Greenland, and Fylingdales, England, to the North America Air Defense Command at Colorado Springs, Colo.

Information is transmitted from the radar sites over high-speed data, voice, and 'teletypewriter circuits simultaneously over a minimum of two routes to a central computer and display units at NORAD Headquarters.

The total system is designed to warn of an intercontinental ballistic missile attack on the North American Continent and/or any intermediate range ballistic missile attack on the United Kingdom.

3. AUTOVON Autovon is the automatic switched network provided to the Department of Defense for handling voice and data communications. It has 4,200 long-haul trunk circuits, and 10,400 access lines using 26 switching machines to serve some 400,000 telephones at about 850 military bases. It is equipped with a precedence preemption capability to enable rapid handling of command fuuc. tions. The circuits are assigned to hardened facilities, underground buildings, and diverse routings for reliability and survivability.

By 1970 this network will be expanded to 65 switching machines with perhaps as many as 40,000 circuits.

Included in Autovon as subnetworks are the Army Command and Control, the Norad Voice Alert, the Joint Chiefs of Staff Conferencing Network, the Air Force Tactical Network, the U.S. Army Intelligence Command, the White House Communications Agency, the U.S. Navy communications project, the Army Air Defense Communications and the SAGE system.

Autovon uses over 3 million circuit miles.


The Federal Telecommunications System is an automatically switched voice network provided to the General Services Administration for the use of all agencies of Government other than the military.

The FTS network serves some 675,000 telephones in 500 locations using about 11,000 circuits and 47 switching machines and handles some 180,000 calls per day, much as is done for the general public on our direct distance dialing (DDD) network.

It is expected that by 1970 the FTS will serve 21/2 million telephones using some 30,000 access lines, intermachine trunks, PBX tielines and 50 switching machines.


The PAS is a voice alerting network of 106 circuits radiating from Omaha, Nebr., to the numbered Air Force headquarters throughout the world. It is used to alert the Strategic Air Command's striking forces located at Strategic Air Command bases and missile complexes. The circuits are equipped with an assurance feature and use about 93,000 miles of circuitry.


NASA is furnished voice, teletypewriter, data, facsimile, and video services for both operational and administrative purposes. Included are communications used in support of manned space programs, launch activities, tracking networks as well as video and facsimile services used to support launch missions. There are some 680 services using more than 600,000 circuit miles.

7. FEDERAL AVIATION AGENCY (FAA) The FAA is furnished some 1,300 services using over 400,000 miles of circuits in a variety of complex arrangements.

The FAA uses these services to perform their functions of coordinating, regulating, and controlling air traffic, collecting and disseminating weather information, as well as remote radar system used for information collection and their operational and administrative uses.


Overseas Government private line circuits provided by the Beil System and its

overseas correspondents

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Qur forecasts of the number of commercial satellite circuits that will be required in 1970, 1975, and 1980 for overseas telephone service are shown in the attached statement. In preparing these forecasts, it was necessary to make certain assumptions regarding rate levels, standards of service, development of internal communications facilities in foreign countries, operating methods (including the introduction of customer dialing) and other factors that have not been reviewed with our foreign correspondents. Since their ideas and actions are likely to have a major bearing on the rate of growth of our overseas telephone

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