On July 22, 2026, the Federal Communications Commission unanimously adopted its Space Modernization for the 21st Century Report and Order (R&O), continuing its comprehensive modernization of the satellite licensing framework. As discussed in our previous alerts, the Commission overhauled both its licensing procedures and milestone requirements. This GT Alert, the third in our series, examines how the R&O restructures how non-geostationary satellite orbit (NGSO) systems are licensed.
Rather than requiring all NGSO applicants to proceed through the same regulatory process, the R&O establishes two distinct licensing pathways. Operators may elect to participate in an annual, frequency-specific processing round that provides spectrum-sharing priority and regulatory certainty in exchange for more rigorous deployment and financial obligations. Alternatively, operators may seek authority outside a processing round under a more flexible licensing framework that does not provide processing-round priority but imposes fewer regulatory obligations. The Commission also eliminates its specialized licensing framework for small satellite systems.
An Optional Processing-Round Framework
Historically, processing rounds served as the default mechanism for licensing NGSO systems proposing operations in the same frequency bands. When the first — or “lead” — application was accepted for filing, the Commission established a cut-off date by which similarly situated applicants were required to submit competing applications to participate in the same processing round. Applications filed before that Bureau-established cut-off date were grouped together and evaluated collectively to determine whether the proposed systems could share spectrum under the Commission's avoidance-of-interference framework. Operators participating in the same processing round generally enjoyed co-equal spectrum-sharing rights with one another and priority over systems licensed in subsequent processing rounds. Applications filed after the cut-off were generally deferred to a subsequent processing round, often delaying substantive review until the next filing opportunity and placing those systems in a junior position with respect to earlier-round participants for spectrum-sharing purposes.
The R&O changes that approach. Rather than waiting for a lead application to trigger a processing round for a particular frequency band, prospective applicants will know in advance when eligible bands will be subject to annual processing-round filing windows. Applicants may then elect to participate in the processing round or pursue authorization outside the processing-round framework under the Commission's alternative licensing path.
Under Part 100, each band-specific processing round will automatically open on Jan. 1 at 12:00 a.m. ET and remain open until Oct. 31 at 11:50 p.m. ET. Applicants seeking authority to operate in a frequency band subject to a processing round may participate by filing an application during the filing window and requesting consideration as part of the round. Participating applicants’ submissions will then be considered together as part of the processing round.
Initially, processing rounds will be available for applications seeking authority to operate in Ka-, Ku-, Q-, and V-band spectrum. Recognizing that spectrum demands and satellite technologies will continue to evolve, the Commission delegated authority to the Space Bureau to designate additional frequency bands for future processing rounds. The Bureau must identify any additional eligible bands before the opening of the applicable annual filing window.
Applicants choosing to participate in a processing round receive regulatory benefits. Most notably, they obtain the spectrum-sharing and priority rights associated with the Commission's processing-round framework, providing greater certainty as additional systems seek access to the same spectrum resources.
Those benefits are accompanied by corresponding obligations. Processing-round participants must:
- Post an initial $10 million surety bond within 30 days of grant, with the bond amount declining as deployment milestones are achieved and reaching zero once 90% of the authorized constellation has been deployed;
- Deploy 50% of the authorized constellation within six years and 100% within nine years;
- Comply with the Commission's coordination and spectrum-sharing obligations applicable to processing-round participants; and
- Risk losing their earlier processing-round status if they fail to satisfy the six-year deployment milestone.
NGSO systems that elect not to participate in a processing round remain subject to the Commission's interference rules and must operate compatibly with both existing and future authorized satellite systems. Unlike processing-round participants, however, they do not receive spectrum-sharing priority over later-filed systems. In exchange for foregoing those priority rights, these operators assume substantially fewer regulatory obligations. Most notably, they are not required to post a surety bond and instead are subject to the Commission's newly adopted ITU-aligned milestone framework, which we discussed in part one.
Small Sats
The R&O eliminates the FCC’s specialized licensing framework for small satellite systems. Previously, small satellite applicants could seek authorization under a separate streamlined process intended to accommodate shorter development timelines, limited mission profiles, and lower-risk characteristics often associated with small satellites. The Commission concluded that maintaining a separate licensing regime was no longer necessary given the evolution of the commercial satellite industry and the broader reforms adopted in the R&O.
Going forward, small satellite systems will generally be evaluated under the same NGSO licensing framework applicable to other systems. The Commission expects this approach to provide greater consistency in the treatment of NGSO applicants while preserving flexibility for smaller operators through the new licensing pathway for systems that do not elect to participate in processing rounds. Small satellite operators seeking the spectrum-sharing benefits associated with processing-round participation may elect to proceed through that framework and assume the corresponding deployment, financial, and coordination obligations.