With respect to private sector involvement in an

ERIS, we recognize there are legitimate governmental and international interests regarding the manner in which earth resources technology is implemented on an operational basis and that such interests must be protected. We are convinced that a direct role for the private sector in the provision of earth resources information services is possible in a manner fully consistent with the protection of those

interests.

In view of our extensive experience in the area of satellite technology applications, we believe that there are means by which to structure the institutional framework for an operational ERIS to provide a more complementary cooperation between the public and private sectors and a more meaningful role for the private sector. As the members of this Committee may recall, many of the same issues which are under consideration here also arose with respect to the establishment of an operational communications satellite

system.

In the case of communications satellites, the Congress passed the Communications Satellite Act of 1962. One of the basic features of this Act was "to provide for the widest possible participation by private enterprise." The results of this approach constitute impressive evidence of Congress's wisdom in providing a major role for the

private sector in the development of an operational communications satellite system.

In considering a potential role for the private sector, we have developed a concept similar to that suggested in the reports prepared for the Subcommittee and pursuant to which the resources of the private sector can be brought to bear to a greater degree on the successful establishment of an operational earth resources satellite system. As we understand it, the suggestion presented in the report envisions the Government as an early and substantial customer of a privately operated system. We support serious consideration of this suggestion as a means by which to best ensure the successful establishment of an operational ERIS.

In considering the level of private sector interest in investment and involvement in an operational ERIS, the extent of U. S. Government requirements for data services and products and the degree to which it would be willing to satisfy its requirements by purchase from the private sector is extremely important. Since the Government presently is the largest single user of Landsat data in the United States, a decision by the Government to satisfy its own requirements for data products and services by purchase from the private sector, and not to compete in the supply of such services to its various agencies and to the public, will have a major impact on the extent of private sector interest in the establishment of an operational system.

Assuming there is a continuing Government requirement for earth resources data products and services, as would appear to be the case judging from the record to date, such requirement could constitute a customer base for a privately owned and operated system and make possible an early transfer of responsibility for an operational

system to the private sector.

In our view, it would not

be necessary for the entire revenue requirements for such a system to be met through provision of services to the Government. Rather, the expectation that a fair portion of the system revenue requirements would be covered by the Government as a customer could induce the private sector to undertake the risk of obtaining additional revenues required to earn a reasonable return on investment through the marketing of services to non-governmental and foreign customers. This concept would appear to have significant advantages for both the Government and the private sector. First, it is consistent with traditional U. S. policy to transfer to the private sector responsibility for operational implementation of services which have been the subject of Government experimental programs. Communications satellites are a primary example of this policy. Second, it would engage the resources, experience and capabilities of the private sector in a more meaningful manner and would provide the greatest incentive to develop the market for earth

resources services and make the benefits of the technology available to the peoples of the world at the earliest date. Third, we believe there would be substantial savings to the taxpayer. Fourth, resolution of the question of respective governmental and private sector roles at this time would remove uncertainties and enlist the resources and capabilities of the private sector at an early date. Finally, we believe this concept can be implemented in a manner which is consistent with the protection of legitimate governmental and

international interests.

As a further elaboration of our views on this subject and in response to the specific questions addressed in the reports submitted by Mr. Matthews, we have attached hereto more detailed comments on those questions.

In conclusion, Mr. Chairman, I wish to express the appreciation of my Company for the interest the Committee is taking with respect to the establishment of an ERIS and thank you for the opportunity accorded me to express views on the important issues before the Committee.

COMMENTS ON SPECIFIC QUESTIONS

REGARDING ESTABLISHMENT OF AN ERIS

What should be the focus and scope of ERIS?

In discussing the scope and focus of an ERIS,

we note that the reports prepared for the Committee use the term ERIS in its broadest context, that is, as potentially encompassing all satellite observing systems and other data sources, as well as the data processing, distribution and analysis functions. If viewed in such manner, it is clear that ERIS is not a "system" but rather a term to describe a collection of systems, satellite and otherwise, and the services which are provided through such systems. This scope appears unduly broad.

There exist today a number of systems owned and operated by various entities which could be regarded as earth resources information systems. While it is possible to regard all of these as component parts of an ERIS, an attempt to bring all, or even most, of them under one authority or to provide for their integration will, indeed, be a formidable, if not impossible, task. The delay inherent in this task would, we believe, prejudice the timely establishment of an ERIS by the United States and U. S.