Deputy Governor Nick Carter has urged Bermuda and the Isle of Man to bury their competing claims and work together over a lucrative satellite slot.

Both sides have claimed the UK Office of Communication (Ofcom) was favouring their bids, but Mr. Carter said the ultimate judge would be the International Telecommunication Union.

The slot, covering the US, could be worth $850 million a year in revenue although maintenance costs will make profits a fraction of that.

The Isle of Man satellite industry has re-paid a 500,000 fighting fund to its parliament because it believes it is sure to get the slot while the Bermuda Government claimed that the Isle of Man was seeking to bait Bermuda and that Bermuda was leading the race.

Bermuda was allocated slots in the early 1980s by the United Nations but in 2002 the Isle of Man filed its intention to make use of a slot which encroached on Bermuda's air space.

The Isle of Man, which lies off England's north west coast, wanted to provide satellite TV service to the United States and the UK Overseas Territories in the region, including Bermuda.

Bermuda found out much later and filed a claim to OfCom which has now been forwarded to the ITU.

Mr. Carter said: "We are very please OfCom has decided to forward Bermuda's filing to the ITU. It is up to the ITU to deal with Bermuda's filing. It is one step at a time.

"The next step would be for the Isle of Man and Bermuda to get together to see if there were grounds to actually co-operate.

"They both cannot occupy the same overlapping bit of sky, it would interfere with each other's broadcasts.

"This happens quite regularly ? the ITU requires the two countries to get together to come to some sort of agreement.

"The Isle of Man, I think, felt until such time as Bermuda filed to the ITU they would not bother coming to the table. I would like to think this changes the situation.

"Bermuda has a serious plan rather significant to the Bermuda economy."

He said the two islands could work together on a joint enterprise or simply sort out the territorial dispute and develop separately.

He said: "It is up to them."

The Isle of Man feels confident after a recently released OfCom report announced that the party making the first application to develop the slot would have priority in the event of a disputed slot ? in this case, the Isle of Man.

Yesterday Isle of Man Government Communications Commission Director Anthony R Hewitt said: "I think it is a satisfactory outcome for all concerned. OfCom in the UK has now established a clear policy that will apply to all negotiations."

He said his island had filed first and so was first in the pecking order while Bermuda had got its filing in which would give it the next claim should the Isle of Man not deliver.

He said: "It's a win-win situation."

The Isle of Man is actively developing its satellite industry and has a developed insurance, financing and manufacturing of high value components, said Mr. Hewitt.

He added that his island wanted to develop a mixed economy and not rely on financial services.