Coalition to Save Our GPS Clippings
April 25, 2011
The Minneapolis Star Tribune has a profile on Philip Falcone and his ambitious plans for LightSquared. The story notes that there is controversy surrounding the company’s plans because it’s a risky bet for investors and could cause GPS interference. As a result, the story says, the GPS industry opposes LightSquared through the Coalition to Save Our GPS.
- “GPS and LightSquared are in adjacent parts of the electromagnetic spectrum,” said Brian Raymond, director of technology policy for the National Association of Manufacturers (NAM) in Washington, D.C. That could cause GPS signals to be “drowned out” within 4 miles of a LightSquared tower, he said. For aircraft, the interference extends as high as 12 miles above a tower, he said.
- Dan Hays, a telecommunications consultant at PRTM Management Consultants in Waltham, Mass., said: “It appears the GPS community has been trying to cut corners for cost reasons, and they found they could make a cheaper GPS receiver if they didn’t filter its signal reception as well as they should have.”
The Minneapolis/St. Paul Business Journal picked up the story. Manufacturing blog Shopfloor also picked up the story, focusing on GPS concerns and quotes provided by NAM.
NextGov reports on the 2010 Federal Radio Navigation Plan released Thursday. According to the report, the federal government has no defined backup for GPS, which it intends to rely on for the foreseeable future. The story notes that Defense Secretary Robert Gates signed it on April 15, three weeks after Deputy Secretary of Defense William J. Lynn III and Deputy Secretary of Transportation John Porcari “blasted” LightSquared’s planned network. The plan can be viewed in full here:
http://www.navcen.uscg.gov/pdf/2010%20FRP_FINAL_Signed.pdf.
Outlets including the Dallas Morning News and Satellite Week continue to report on an AT&T filing with the FCC last week on a potential merger with T-Mobile. The stories note that AT&T pointed to LightSquared as an example of competition in the industry.
Others including Wireless News, Engadget, LTE World and Gerson Lehrman Group continue to cover a deal reached between LightSquared and Cellular South.
A cite list and the full text of these and other articles follow.
SATELLITE WEEK
April 25, 2011 Monday
GPS Increases Lobbying Spending for LightSquared Fight
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GPS users have stepped up their lobbying outlays to help deal with the potential interference from LightSquared’s coming wireless network, public lobbying disclosure forms show. Trimble Navigation, which is one of the leaders in the fight against LightSquared’s service, increased lobbying expenses by $90,000 in Q1 this year, compared to a year ago. The company spent $200,000 on lobbying in Q1, adding Akin Gump and Innovative Strategies to their payroll, both of which pointed to potential interference with GPS as their sole issue. Garmin paid Dow Lohnes $20,000 to lobby on the issue in Q1, after spending less than $5,000 in the same quarter a year ago.
The GPS lobbying may be paying off, with members of the Senate (SW April 18 p3) and House (SW April 4 p1) as well as federal agencies recently voicing concern over LightSquared’s proposed service. LightSquared is in the process of reviewing the potential for interference along with federal and commercial GPS users, as required by the FCC, but that hasn’t quieted the complaints in Washington.
Several other groups and companies listed the LightSquared fight as an issue they are lobbying on, showing the variety of industries working the issue. The Association for Unmanned Vehicle Systems International, the National Corn Growers Association, the National Association of Manufacturers, the Aircraft Owners and Pilots Association and the U.S. Chamber of Commerce all specifically named LightSquared as being involved in issues they are lobbying on. The AUVSI, NAM and Pilots Association are part of the Coalition to Save Our GPS, an ad hoc group opposed to LightSquared’s service and the NCGA said its interest in the issue is asking for FCC reconsideration of the waiver the FCC granted LightSquaredthat would allow it to offer terrestrial-only service. Other members of the group, including Deere and the Boat Owners Association of the U.S., mention the issue in their filing. The Chamber of Commerce didn’t comment and its interest is unclear from the filing.
LightSquared, didn’t spend much more in the quarter compared to last year, $190,000 vs. $185,000, but the company did spread the money around more. The company, which employed three lobbying groups in Q1 last year, this year used Gephardt Group, Wexler & Walker, Mehlman Capital Strategies, Palmetto Group and American Continental Group, with Mehlman and Palmetto getting the largest chunks, at $60,000 each. — Tim Warren
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SATELLITE WEEK
April 25, 2011 Monday
LightSquared Working Group Will Look at Several Spectrum Uses
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The LightSquared-led working group that is looking at interference issues between LightSquared’s proposed terrestrial signals and nearby spectrum will include several “sub-teams” that will work on specific spectrum uses, the company said in its second progress report filed at the FCC. Those groups will separately focus on interference with aviation, cellular, general location/navigation, space-based receiver, high precision, networks and timing services, the filing said.LightSquared previously said it would use sub-teams but hadn’t named them.
LightSquared is required to file monthly progress reports on the group and is working with the U.S. GPS Industry Council and others to determine the extent of interference. A final report is due to the FCC by June 15.
The aviation sub-team will rely “primarily” on Federal Aviation Administration-funded testing that will emulate LightSquared and GPS signals that will be fed into test receivers, the filing said. The cellular team will test devices at CTIA authorized test labs and will follow “industry standards established by 3GPP and CTIA” for GPS signals, said the working group. The team will test about 50 different devices that “represent both current and legacy devices and have been prioritized based on sales volumes” and “will focus largely on handheld devices,” it said. The general location/navigation team will test at Alcatel-Lucent and is expected to look at 26 devices, the filing said.
The high precision, networks and timing sub-teams will work together in testing devices at the U.S. Navy’s NAVAIR lab, said the working group. That sub-team will measure the impact of LightSquared signals on the tracking, reacquisition, acquisition, tracking sensitivity, and acquisition sensitivity of GPS receivers, the filing said. The space-based receivers team has already done some initial interference testing at the NASA jet propulsion lab and will do additional testing with varying environments, the filing said. — Tim Warren
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SATELLITE WEEK
April 25, 2011 Monday
MOBILE SATELLITE
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LENGTH: 113 words
Mobile satellite service provider LightSquared signed a roaming agreement with Cellular South, the companies said. “This agreement will provide subscribers of Cellular South with a nationwide 4G-LTE footprint as well as satellite coverage in rural areas where there is no terrestrial network,” said a news release. “It will also expand LightSquared’s 4G data coverage to additional rural communities.” LightSquared also signed a bilateral roaming agreement with SI Wireless, a partnership of rural independent phone companies, said LightSquared. The deal will give SI Wireless subscribers access to nationwide 4G and satellite coverage, LightSquared said. Terms weren’t released.
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SATELLITE WEEK
April 25, 2011 Monday
SATELLITE NOTES
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AT&T in a filing at the FCC formally sought permission to buy T-Mobile. The filing stresses growing competition in the wireless market, from other carriers ranging from Sprint Nextel to LightSquared. Sprint “has reversed its earlier setbacks, added nearly 1.8 million net subscribers in 2010,” the filing said. MetroPCS and Leap “have signed a long-term mutual roaming agreement, offer nationwide service plans, and now sell service in markets covering more than 200 million Americans.” Clearwire “is the nation’s largest holder of spectrum” and LightSquared is “a spectrum-rich and well-capitalized wireless entrant” that “plans to deploy a 4G LTE network covering 100 million people by the end of 2012 and 260 million by the end of 2015.”
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Wireless News
April 25, 2011 Monday
LightSquared and Cellular South Enter Into Bilateral Roaming Agreement
LENGTH: 316 words
LightSquared, a wholesale-only integrated 4G-LTE wireless broadband and satellite network, and Cellular South, a wireless communications provider, have entered into a bilateral roaming agreement.
This agreement will provide subscribers of Cellular South with a nationwide 4G-LTE footprint as well as satellite coverage in rural areas where there is no terrestrial network. It will also expand LightSquared’s 4G data coverage to additional rural communities.
“LightSquared’s wholesale-only, integrated 4G-LTE wireless broadband and satellite network, makes them a valuable partner because it enables us to provide our customers, including those in rural locations, with nationwide access to the most advanced technology and reliable coverage available,” said Hu Meena, president and CEO of Cellular South.
“Cellular South’s passion and commitment to helping their customers get the most out of their wireless services makes them a great partner for LightSquared,” said Sanjiv Ahuja, Chairman and CEO of LightSquared. “We are pleased to offer Cellular South our nationwide 4G-LTE and satellite coverage and capacity through our wholesale-only model at attractive rates so they can better service their customers, and we’re pleased to offer our customers additional coverage through Cellular South’s extensive network.”
LightSquared offers people universal broadband connectivity, wherever they are in the United States. Through its wholesale-only business model, those without their own wireless network or who have limited geographic coverage or spectrum can develop and sell their own devices, applications and services using LightSquared’s open 4G network.
Cellular South is a diversified mobile communications company, providing wireless voice and data network, offering family and unlimited flat rate voice, text and mobile web plans.
((Comments on this story may be sent to newsdesk@closeupmedia.com))
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Engadget Mobile
April 23, 2011 Saturday 3:37 AM EST
Cellular South inks deal with LightSquared, gets LTE with stroke of a pen
BYLINE: Zachary Lutz
LENGTH: 137 words
Apr. 23, 2011 (AOL Weblogs delivered by Newstex) —
Cellular South just dropped a nugget, announcing its hopped aboard with LightSquared to provide nationwide LTE service to its 900,000 subscribers. In turn, the 4G wholesaler promised to bring coverage to rural communities (and offer satellite service for those in really distant locales). Cellular South joins Cricket, Best Buy Connect and SI Wireless as the latest to add LTE coverage the easy way, though they’re left waiting for the network to come online sometime in 2012. Meanwhile, LightSquared continues working to resolve those pesky GPS concerns, with a final report due to the FCC on June 15th. PR after the break.
[Image courtesy Flickr]
Continue reading Cellular South inks deal with LightSquared, gets LTE with stroke of a pen
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THE DALLAS MORNING NEWS
April 22, 2011 Friday
1 EDITION
AT&T calls merger key to better network
BYLINE: DAVE MICHAELS, WASHINGTON BUREAU dmichaels@dallasnews.com
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LENGTH: 803 words
DATELINE: WASHINGTON
WASHINGTON – Aiming to sway regulators who must approve its mega-merger with T-Mobile USA, AT&T Inc. said Thursday the deal would allow it to expand high-speed wireless broadband to 55 million more Americans than it otherwise could.
In a filing with the Federal Communications Commission, Dallas-based AT&T said the acquisition would allow it to deploy 4G LTE service to more than 97 percent of Americans – up from the 80 percent planned before the deal was announced.
The merger would “promote, not diminish competition,” improve existing service for wireless customers, and help accommodate the growing demand for wireless data usage, the company said.
“That means fewer dropped calls, fewer call attempts, and greater data throughput,” said Joan Marsh, AT&T’s vice president for federal regulatory affairs.
Sprint speaks out
While AT&T put its best spin on the deal, rival Sprint Nextel Corp. asked the FCC to reject it. Consumer groups and some Internet companies are also likely to petition the FCC to oppose the deal.
Sprint said the merger would create a market dominated by AT&T and fellow giant Verizon Wireless. Sprint, the nation’s third-largest carrier, said the merger would result in fewer choices for consumers and would give AT&T power to “increase prices, threaten innovation critical to this industry and eliminate American jobs.”
“This proposed takeover cannot be fixed with conditions or divestitures,” said Vonya McCann, Sprint’s senior vice president for government affairs. “We believe the facts and the law dictate this transaction must be blocked, and we are confident that the Department of Justice and FCC will determine that this takeover is not in the interest of the American public.”
Sprint was widely believed to be the leading candidate to acquire T-Mobile before AT&T stepped in. Sprint criticized the deal almost as soon as it was announced, but Verizon Wireless has stayed out of the debate.
AT&T chief executive Randall Stephenson has said he expects the deal to be approved. The company thinks some conditions will be attached to approval, although it suggested Thursday that they would be limited.
“I don’t think you can say the sky is the limit in terms of divestitures here,” said Gary Phillips, general attorney and associate general counsel at AT&T.
The review of the merger is being conducted by the FCC and the U.S. Department of Justice’s antitrust division. The FCC must determine whether the merger would help or hurt competition, and whether it would result in new technology and services for consumers.
T-Mobile’s 34 million existing customers would be able to keep their current pricing plans after the merger closes, AT&T said in the application.
In the FCC filing, AT&T went out of its way to praise Sprint and other carriers as fierce competitors with excellent phones and bountiful spectrum holdings, while noting that T-Mobile was losing customers and had no clear plan to upgrade to 4G.
Competition concerns
The goal is to convince regulators that competition will remain strong even if a faltering T-Mobile is swallowed up.
While regulators analyze the economic arguments, AT&T is also likely to make its case directly to consumers and politicians.
The application plays up the merger’s ability to meet President Barack Obama’s goal of expanding high-speed wireless to every American. And AT&T has enlisted support from politically influential unions, including the AFL-CIO and the Communications Workers of America, that are important to Democrats.
AT&T officials wouldn’t commit Thursday to maintaining all the jobs involved if the deal is approved. But in the past, AT&T has relied on “natural attrition,” not layoffs, to reduce its workforce after a merger, Marsh said.
Spectrum control
Part of the FCC’s review will involve looking at how much spectrum, or wireless airwaves, would be concentrated in the hands of the combined company.
AT&T rolled out some of its arguments addressing that point. It said the FCC’s current test doesn’t “count everything it should count,” including spectrum controlled by LightSquared, which is building a satellite-based, wireless broadband network.
AT&T says the merger is the only way to address the shortage of spectrum that carries huge amounts of voice traffic and data. Marsh said it would take eight years for AT&T to build out the number of cell towers it would acquire from T-Mobile, and that’s only if the company could get the permits and other approvals needed to build them.
AT&T said it would confront “spectrum exhaust” for 3G service in some markets by 2013. The addition of T-Mobile’s cell sites to its network would double “the amount of network traffic that can be carried using existing spectrum,” Marsh said.
“This will clearly address those immediate needs,” she said.
Staff writer Victor Godinez contributed to this report.
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Satellite Today
April 22, 2011 Friday
LightSquared Wins Second U.S. Satellite Roaming Agreement with SI Wireless
SECTION: Vol. 10 No. 80
LENGTH: 147 words
[Satellite TODAY 04-21-11] Integrated hybrid network operator
LightSquared will provide 4G-LTE services and satellite coverage over unserved
areas to SI Wireless customers in Illinois, Kentucky and Tennessee as the result
of a bilateral agreement signed by the two companies, LightSquared announced
April 21.
The agreement will see LightSquared utilize 3G-CDMA/EVDO
technologies to provide SI Wireless subscribers with a nationwide 4G-LTE
footprint while expanding LightSquared’s data coverage to additional rural
communities in the SI Wireless coverage area.
“We understand that subscribers of Tier 2 and 3 carriers expect access to
the most advanced technology nationwide and LightSquared’s business model is
completely aligned with the coverage and capacity needs of rural operators,
allowing them to compete with their larger competitors,” SI Wireless CEO Terry
Addington said in a statement.
LOAD-DATE: April 22, 2011
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TELECOM A.M.
April 22, 2011 Friday
AT&T Seeks FCC’s Blessing to Buy T-Mobile
SECTION: TODAY’S NEWS
LENGTH: 172 words
AT&T officially asked the FCC’s permission to buy T-Mobile. AT&T increased its projection for how much of the U.S. it will cover with wireless broadband if the deal is approved, to 97 percent from 95, putting it close to the Obama administration’s goal of covering 98 percent of households within five years. A filing stressed that wireless competition is intensifying, with pressure from providers such as Sprint Nextel and LightSquared. AT&T also emphasized the spectrum that will be freed up as a result of efficiencies if AT&T and T-Mobile are allowed to merge.
“AT&T faces network spectrum and capacity constraints more severe than those of any other wireless provider, and this merger provides by far the surest, fastest, and most efficient solution to that challenge,” the carrier said. “The network synergies of this transaction will free up new capacity — the functional equivalent of new spectrum — in the many urban, suburban, and rural wireless markets where escalating broadband usage is fast consuming existing capacity.”
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Long way to go for LightSquared wireless
Minneapolis / St. Paul Business Journal – by Mark Reilly, Managing Editor
Date: Monday, April 25, 2011, 7:15am CDT
Could you launch a nationwide wireless network — complete with thousands of cell towers and a satellite or two — in a year? A Minnesota-born financier is going to try.
The Star Tribune profiles LightSquared, a Reston, Va.-based business that is partnering with companies like Best Buy to sell broadband wireless service through retailers and other companies. The venture is backed by Philip Falcone, CEO of Harbinger Capital Partners, who hails from Minnesota.
LightSquared expects to begin building out a network in Minneapolis in the second half of next year. The Twin Cities’ “concentrated population” appealed to the company, and company officials are confident
they can find customers here. It better hope it lives up to its name, though — those towers haven’t been built, the satellite hasn’t been launched and it’s running on a federal deadline of 2012.
mreilly@bizjournals.com | 612.288.2110 | @reillymark
Shopfloor
A New Phone Service Potentially Disrupting GPS
Posted by: Carter Wood under Communications, Technology on April 25, 2011 @ 8:58 am
The Minneapolis Star-Tribune reports on LightSquared’s plan to create a new cell- and satellite-phone system, a local story for the paper since Minnesota-born billionaire Philip Falcone is behind the company and Best Buy has agreed to sell the service. Manufacturers and other companies are concerned that LightSquared’s approach will interfere with Global Positioning System devices that are so critical to transportation, supply chains and consumer products.
From “Smartphone network is aiming sky-high“:
GPS and LightSquared are in adjacent parts of the electromagnetic spectrum,” said Brian Raymond, director of technology policy for the National Association of Manufacturers in Washington, D.C. That could cause GPS signals to be “drowned out” within 4 miles of a LightSquared tower, he said. For aircraft, the interference extends as high as 12 miles above a tower, he said.
As a result, the GPS industry opposes LightSquared through a group called the “Coalition to Save Our GPS,” and has received verbal support from the U.S. Air Force Space Command that operates the GPS satellites. About 500 million GPS units are in use in the United States, the coalition said. GPS chips are widely used in smartphones, but also are used in industrial equipment as varied as aircraft and farm tractors and in cars and boats.
The NAM is a member of the Coalition to Save Our GPS.
LTE World
LightSquared partners with Cellular South, SI Wireless
By Pankaj – Posted on 24 April 2011
LightSquared has entered into a bilateral roaming agreement with Cellular South and SI Wireless. Cellular South is a privately owned wireless communications provider where as SI Wireless is a partnership of rural independent telephone companies, delivering 3G-CDMA/EVDO technology to rural parts of Illinois, Kentucky and Tennessee.
This agreement will provide subscribers of Cellular South and SI Wireless with a nationwide 4G-LTE footprint as well as satellite coverage in rural areas where there is no terrestrial network. It will also expand LightSquared’s 4G data coverage to additional rural communities.
“We understand that subscribers of Tier 2 and 3 carriers expect access to the most advanced technology nationwide and LightSquared’s business model is completely aligned with the coverage and capacity needs of rural operators, allowing them to compete with their larger competitors,” said SI Wireless Chief Executive Officer, Terry Addington
“LightSquared’s wholesale-only, integrated 4G-LTE wireless broadband and satellite network, makes them a valuable partner because it enables us to provide our customers, including those in rural locations, with nationwide access to the most advanced technology and reliable coverage available,” said Hu Meena, president and CEO of Cellular South.
Intelligently Connecting Institutions and Expertise
NEXTGOV
Federal radio navigation plan relies on GPS, with no backup
By Bob Brewin 04/22/11
The federal government intends to rely on the Global Positioning System for precision navigation, location and timing services for the foreseeable future, with no defined backup, according to a key planning document released Thursday by the Defense, Homeland Security and Transportation departments.
The 2010 Federal Radio Navigation Plan also envisions decommissioning key ground band navigation aids maintained by the Federal Aviation Administration as it moves to its GPS-based Next-Generation Air Transportation System.
Homeland Security approved the 219-page plan in March and Transportation last December. Defense Secretary Robert Gates signed it on April 15, three weeks after Deputy Secretary of Defense William J. Lynn III and Deputy Secretary of Transportation John Porcari blasted plans by startup cellular carrier LightSquared to operate in a frequency band that could interfere with GPS receivers.
Last November the National Space-Based Position, Navigation and Timing (PNT) Advisory Board, chaired by former Defense Secretary James Schlesinger, warned that the proliferation of inexpensive GPS jammers widely available for purchase over the Web made development of a backup system for GPS a national imperative.
Despite this warning and the potential of interference from LightSquared, the latest radio navigation plan did not identify a specific backup system for GPS. The plan said Homeland Security “is determining whether alternative backups or contingency plans exist.” But, the plan added, “An initial survey of the federal critical infrastructure partners indicated wide variance in backup system requirements … DHS is working with federal partners to clarify the operational requirements.”
The PNT advisory board recommended using a system called eLORAN as a GPS backup, but President Obama zeroed out funding for LORAN (LOng RAnge Navigation) project in his 2010 budget, and the U.S. Coast Guard started shutting down the system and blowing up its towers last April.
The advisory board said FAA is exploring an alternative ground-based navigation system, but the earliest it would be capable of operation is 2025. In the meantime, FAA intends to divest to private operators or decommission ground-based navigation systems, the plan said. FAA operates 1,200 instrument landing systems to aid precision approaches, and the plan said FAA may shut some of these down, once GPS augmentation systems become operational. FAA has also targeted for eventual closure another 1,000 ground-based systems that provide heading information to pilots.
The plan also calls for Homeland Security to develop systems to mitigate the effect of jammers on GPS, but does not detail any specific systems.
This March the Royal Institute of Navigation in the United Kingdom released a report that warned that “Society may already be dangerously overreliant on satellite radio navigation systems like GPS … The range of applications using the technology is now so broad that, without adequate independent backup, signal failure or interference could potentially affect safety systems and other critical parts of the economy.”
David Last, a consultant to the General Lighthouse Authorities of the United Kingdom and Ireland, which operates aids to navigation systems in those countries, said, “It is difficult for international observers to see consistency in U.S. radio navigation policy.”
While the PNT advisory board called for development of GPS backup systems, the radio navigation plan abandons that “in the hope that detection and mitigation of interference will save the day” Last said. He found it odd that the plan did not include any GPS backup, even as Defense and Transportation raised serious concerns about the potential of interference to GPS by LightSquared.
© 2011 BY NATIONAL JOURNAL GROUP, INC. ALL RIGHTS RESERVED
Minneapolis Star Tribune
Smartphone network is aiming sky-high
Article by: STEVE ALEXANDER , Star Tribune
Updated: April 24, 2011 – 2:33 PM
LightSquared, backed by Minnesota Wall Street whiz Philip Falcone, wants to revolutionize wireless communications next year.
Minnesota-born billionaire Philip Falcone is betting that the sky’s the limit when it comes to cellphones.
A Falcone-backed company called LightSquared is about to launch what may become the nation’s largest wireless network for smartphones and mobile computers — starting next year.
The network would combine two communications satellites and 40,000 earthbound antennas to cover 92 percent of the nation’s land area by the end of 2015. That’s more land coverage than any other wireless provider offers consumers. But the quality wouldn’t be uniform — the antennas would provide fast 4G data speeds in cities, while the satellites would deliver slower speeds in rural areas.
LightSquared’s business model is just as unorthodox. It would be the nation’s first exclusively wholesale wireless network, selling to retailers such as Best Buy. The retailers could then compete with traditional cell providers Verizon Wireless, Sprint and AT&T.
Best Buy confirmed that it has agreed to buy service from LightSquared, but won’t elaborate.
Because of these ambitious plans, LightSquared is controversial. Depending on whom you ask, it’s a risky bet for Falcone’s investors, a radio interference threat to the global positioning system (GPS) industry or exactly the right idea at the right time.
That’s a lot of attention considering that construction of the network has barely begun. The company’s SkyTerra 1 satellite was launched last November; a second satellite is planned but there’s no launch date. And those thousands of cellular towers? They haven’t been built.
But LightSquared is expected to leap into the market because it faces a deadline. Under its agreement with the Federal Communications Commission (FCC), the company must start service in 2012, and complete the network by the end of 2015.
Privately owned LightSquared, based in Reston, Va., is run by CEO and Chairman Sanjiv Ahuja and has about 180 employees. Until last year the firm’s name was SkyTerra, now the name used for its communications satellites.
The buzz around LightSquared has been good news for Falcone, the CEO and founder of the Harbinger Capital Partners hedge fund in New York. Falcone, 48, is a onetime Minnesota high school hockey player who went on to play hockey at Harvard and was worth $2.2 billion in March, according to Forbes magazine.
But only six months ago there were news reports that Harbinger was being investigated by the Securities and Exchange Commission and the Manhattan U.S. attorney’s office over a $113 million loan the fund made to Falcone so he could pay his taxes. Falcone said through a spokesman that he has repaid the loan, but declined further comment.
Those who say LightSquared is a risky bet cite the cost — $1 billion spent so far and an estimated $6 billion or more needed by 2015 — plus the fact that many of Falcone’s traditional investors reportedly have pulled out of Harbinger over concerns that LightSquared can’t deliver on its promise. LightSquared won’t say how much additional money it needs to complete the network in four years.
“LightSquared’s problem is that they are building a nationwide telecommunications network from scratch, which is a formidable task,” said Bill Ho, an analyst at research firm Current Analysis in Sterling, Va. “It’s a big risk, given the billions of dollars that they need.”
Others are focused on a technical risk. The GPS industry alleges that interference from LightSquared’s earthbound antennas will render nearby GPS devices useless.
“GPS and LightSquared are in adjacent parts of the electromagnetic spectrum,” said Brian Raymond, director of technology policy for the National Association of Manufacturers in Washington, D.C. That could cause GPS signals to be “drowned out” within 4 miles of a LightSquared tower, he said. For aircraft, the interference extends as high as 12 miles above a tower, he said.
As a result, the GPS industry opposes LightSquared through a group called the “Coalition to Save Our GPS,” and has received verbal support from the U.S. Air Force Space Command that operates the GPS satellites. About 500 million GPS units are in use in the United States, the coalition said. GPS chips are widely used in smartphones, but also are used in industrial equipment as varied as aircraft and farm tractors and in cars and boats.
Dan Hays, a telecommunications consultant at PRTM Management Consultants in Waltham, Mass., believes the GPS controversy will be settled because the GPS industry is largely to blame for any interference problems.
“It appears the GPS community has been trying to cut corners for cost reasons, and they found they could make a cheaper GPS receiver if they didn’t filter its signal reception as well as they should have,” Hays said.
The GPS Coalition denies that the industry is to blame for interference problems.
LightSquared says it’s working to resolv the issue.
“There’s no interference problem that can’t be fixed,” said Jeff Carlisle, LightSquare’s executive vice president of regulatory affairs. “We can coexist with GPS.”
The FCC is allowing LightSquared to test its network this fall in Las Vegas, Phoenix, Baltimore and Denver.
Hays said LightSquared could be a huge success.
“Demand for data services is overtaking the traditionally voice-centric cellular industry, and LightSquared should help us meet our insatiable appetite for mobile data,” he said.
LightSquared said its network would be optimized for data rather than voice, although it will offer the digital voice calling technology popularized by Vonage.
Sprint partnership?
Hays also expects that LightSquared’s network construction costs will fall as a result of a rumored agreement with Sprint to share existing Sprint cellular antenna towers rather than build new ones.
If that’s true, LightSquared “might be able to get away with spending $2 billion to build their network instead of $6 billion to $8 billion,” Hays said.
Sprint and LightSquared declined to comment.
LightSquared’s financial picture would brighten if rumors of an initial public stock offering later this year are true. LightSquared declined to comment on its plans.
But for all LightSquared’s big plans, its focus on selling wireless service wholesale may be its most important feature.
Today, companies ranging from Apple to Wal-Mart are forced into partnerships with cellular companies in order to sell their Internet-connected phones, hand-held devices and computers.
Using a wireless service bought wholesale from LightSquared, they could make greater profits and cultivate long-term relationships with customers.
“Using the geolocation function on a phone, a manufacturer or retailer could follow you, learn your habits and find out what online services you opt into,” Ho said. “Then they’ll know what kinds of advertising to offer you.”
Steve Alexander • 612-673-4553