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LightSquared back to square zero

FCC rescinds conditional waiver order

by Sam Pfeifle | February 17, 2012

WASHINGTON - LightSquared's hopes for operating a groundbased broadband wireless network had been on life support for some time, but the FCC effectively dashed those hopes this week with the announcement it is rescinding the conditional waiver order it gave the company back in January of 2011. In an "unofficial announcement of commission action" delivered in the form of a statement from FCC spokesperson Tammy Sun, we learn:

“LightSquared’s proposal to provide ground-based mobile service offered the potential to unleash new spectrum for mobile broadband and enhance competition. The Commission clearly stated from the outset that harmful interference to GPS would not be permitted. This is why the Conditional Waiver Order issued by the Commission’s International Bureau prohibited LightSquared from beginning commercial operations unless harmful interference issues were resolved.

“NTIA, the federal agency that coordinates spectrum uses for the military and other federal government entities, has now concluded that there is no practical way to mitigate potential interference at this time. Consequently, the Commission will not lift the prohibition on LightSquared. The International Bureau of the Commission is proposing to (1) vacate the Conditional Waiver Order, and (2) suspend indefinitely LightSquared’s Ancillary Terrestrial Component authority to an extent consistent with the NTIA letter. A Public Notice seeking comment on NTIA’s conclusions and on these proposals will be released tomorrow."

LightSquared responded to this action with a pair of press releases, the first, on Feb. 14, questioning the NTIA's testing methods and the FCC's resulting decision:

"LightSquared profoundly disagrees with both the NTIA’s and the PNT’s recommendations," the statement said, "which disregard more than a decade of regulatory orders, and in doing so, jeopardize private enterprise, jobs and investment in America's future. NTIA relies on interference standards that have never been used in this context, and were forced by the GPS community in order to reach the conclusions presented today. This, together with a severely flawed testing process that relied on obsolete and niche devices, shows that the FCC should take the NTIA's recommendation with a generous helping of salt."

The next day, LightSquared released a statement attributed to company chairman and CEO Sanjiv Ahuja. In it, he emphasizes LightSquared's long history with the FCC, along with the company's $4 billion investment in getting to its current state. "After years of receiving regulatory approvals," he wrote, "the FCC approved LightSquared to build its ground network in 2005. In 2010, the FCC amended that plan, requiring LightSquared to build a national broadband network that reached 260 million Americans. At the government’s mandate, LightSquared began investing billions of dollars in America’s infrastructure – without asking for any money from the American taxpayer. Yesterday, after LightSquared had already spent nearly $4 billion, the FCC changed its mind. There can be no more devastating blow to private industry and confidence in the consistency of the FCC’s decision-making process."

He goes on to claim politics, and not good science, influenced the FCC's decision, and closes with this statement: "The American people send their representatives to Washington to solve tough problems and make our country better – not to undermine and pull the rug from under private enterprise."

Without the fast-tracking waiver, LightSquared is effectively back at the beginning in terms of acquiring regulatory approval for its broadband network. Considering the actions of the FCC this week, there are few observers who think LightSquared will ever be able to actualize its plans. "We believe LightSquared has few viable options to recover,” said Jeff Silva, an analyst at Medley Global Advisors, told the Washington Post. “There’s still a possibility the start-up could rise from the ashes late. . . . But it appears to be a fanciful long shot."

 

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