FCC cools on LightSquared again
Demands more testing, but with no timelines or assurances, which could give supporters cold feet
Published: 15 September, 2011
After a burst of hope last week, the FCC appears to have dealt another blow to LightSquared's hopes of building an LTE network in its L-band mobile satellite (MSS) spectrum. Tuesday saw the FCC calling for further testing, but unlike an earlier letter from the main US government technology agency, the NTIA, which sought a firm timescale to address the issue, the FCC's document is worryingly vague for LightSquared.
Both agencies are mandating further tests, particularly of filters which the operator has pledged to develop to protect the Augmented GPS signals (it has agreed not to start any commercial roll-out until these are approved). But beyond that, their approaches are diverging. The NTIA appeared to be fast-tracking the process, and discouraging further protests, when it called for at least the more basic testing to be concluded by the end of November. In a letter to the US Departments of Defense and Transportation, the body urged a swift 'first look' at test results centered on interference to consumer GPS devices. It said further testing would then be needed for industrial GPS receivers, used for the high precision applications.
This was enough, along with a softened tone from the GPS sector the week before, to encourage LightSquared supporters. "The NTIA's letter has established a path forward that will finally allow LightSquared to put concerns about the impact of its network on GPS to rest," CEO Sanjiv Ahuja said in a statement on Monday. "LightSquared is already working on a technical solution that will resolve those remaining interference issues and that will keep the company on track to beat the FCC's 2015 build-out deadline."
The FCC, by contrast, seems to be throwing cold water on such optimism. It does not set out any timetable for completing the additional testing of augmented devices, nor specified the tests it requires. As the analyst providing the best specialist coverage of the saga, Tim Farrar of TMF Associates, blogs: "What comes as a huge shock is that the FCC has offered LightSquared absolutely nothing to indicate it is minded to approve LightSquared's terrestrial operations in the future … Today's Public Notice clearly indicates that the FCC has lost all patience with LightSquared and no longer believes that it is a viable option for creating additional competition in the wireless market. Thus perhaps [LightSquared chairman] Mr Falcone's next call to the FCC chairman ought to involve a bit of Shakespeare: 'Et tu, Julius?'."
Farrar and others believe the LightSquared roll-out is now suspended indefinitely, and that will raise difficult challenges in keeping customers and financial supporters confident and prepared to ride out a storm of delays, uncertainty and the ongoing costs (whatever the outcome) of developing the filters, and paying fees to Inmarsat (from whom LightSquared leases some of its spectrum) and possibly Sprint (with which it has an infrastructure sharing deal). If the scheme falls apart, Farrar believes only Inmarsat would be interested in buying the spectrum assets with no terrestrial waiver attached - "and even then the price would likely be only a few hundred million dollars at best." Of course, that bleak eventuality would provide the opportunity for Dish - which could still get a terrestrial waiver since its MSS bands are further from GPS - and/or Clearwire to step up as the main 'third way' for US mobile broadband.