LightSquared needs FCC spectrum ruling urgently
Sprint Nextel has granted LightSquared a 30-day extension in its deadline to obtain clearance to operate its network from the FCC.
This gives LightSquared until January 30, 2012 to obtain FCC clearance, after it missed its earlier deadline of December 31, 2011. LightSquared must obtain this clearance in order to go ahead with a 15-year agreement to share LTE spectrum and equipment with Sprint.
LightSquared has suffered open setbacks since the Department of Transportation and the Department of Defense found that the use of its licensed spectrum band would cause “harmful interference” with the GPS network used by the aviation and navigation industries.
LightSquared has contended these accusations vigorously, refuting the GPS industry’s claims that it must alter its plans and abandon the use of large segments of its licensed frequency in the 1525-1559 MHz mobile-satellite service band. LightSquared also argues that it was able to develop “appropriate filtering technologies for GPS receivers” in less than six months, questioning why the GPS industry has not taken the same action.
LightSquared’s latest petition to the FCC, filed on December 20, 2011, makes it very clear that it intends to fight the charges to their end. It is also keen to clarify that the business will not be called upon to pay for any potential solutions or fixes to address the GPS interference.
It is not clear whether LightSquared can expect any kind of resolution or judgment by Sprint’s deadline of January 30, raising speculations about the future of the business. According to its financial reports, LightSquared lost $427 million in 2011, and Reuters has reported financial statements showing concerns about the business’s financial viability after the spring, without additional financing. In response, LightSquared claimed that it has enough money for the “next several quarters”. LightSquared has formed agreements to provide 4G mobile broadband services with Best Buy and Leap Wireless International, but these also depend on FCC approval.
The agreement with LightSquared was widely expected to help Sprint compete in the 4G market, as well as saving it billions over the next seven years. These anticipated benefits have led to Sprint granting the 30-day extension, but it remains unclear what will happen for both parties if the FCC does not rule favourably within that period.