Save our GPS
January 16, 2012 Forbes Magazine article “Lightscrewed: How Washington Whipped Phil Falcone”
FCC request for public comment on the LightSquared position that GPS users and receivers “do not merit legal protection from interference” created by LightSquared. The FCC asks for comments by February 27th, 2012
LightSquared’s position statement that GPS users and receivers “do not merit legal protection from interference”
Link leads to documents released today by the FCC in reaction to Freedom of Information Act (FOIA) requests: http://www.fcc.gov/encyclopedia/lightsquared-foia
DoD, DoT Deputy Secretaries Say No Practical Solutions Exist for LightSquared Interference to GPS article
Coalition to Save Our GPS Clips
February 14, 2012
reports that President Obama’s budget released Monday includes a provision aimed at LightSquared:
·"SEC. 618. None of the funds made available in this Act may be used by the Federal Communications Commission to remove the conditions imposed on commercial terrestrial operations in the Order and Authorization adopted by the Commission on January 26, 2011 (DA 11-133), or otherwise permit such operations, until the Commission has resolved concerns of potential widespread harmful interference by such commercial terrestrial operations to commercially available Global Positioning System devices."
, Communications Daily
, The Hill
report that U.S. Rep. John Conyers (D-Mich.) sent a letter to FCC Chairman Julius Genachowski urging the commission to move forward with its review of the LightSquared waiver.
·"I write to express concern about delays in the approval process involving LightSquared's proposed 4G-LTE wireless broadband network”…"I strongly urge the Commission to move with urgency to fully test potential solutions to the LightSquared-GPS interference issue employing transparent, fact-based methodologies, common-sense standards and independent testing facilities."
reports that Globalstar said in an FCC filing that the commission should consider "individualized circumstances" in determining terrestrial build-out requirements for mobile satellite service/ancillary terrestrial component operators.
The Wall Street Journal
(WSJ) and Bloomberg
report that Sprint’s board has decided that bonuses for Chief Executive Dan Hesse and other employees will not suffer as a result of the company’s bet on the iPhone. WSJ notes that also not included as a benefit to the company’s books is a network-sharing deal with LightSquared, whose network is stalled while it tries to resolve GPS interference concerns.
To see what LightSquared and the Coalition to Save Our GPS are saying on Twitter, click here
A cite list and links to the full text of these and other articles follow.
1.The Hill, Conyers concerned about delays in LightSquared approval, By Brendan Sasso, 02/13/12 01:00 PM ET
2.CNET, LightSquared strums up political support, by Marguerite Reardon, February 13, 2012 12:46 PM PST
3.National Journal, Obama Budget Targets LightSquared, By Josh Smith, February 13, 2012
4.Broadcasting & Cable, Genachowski: Concerned About Incentive Auction Legislation, Tells Flatirons audience net neutrality rules defused radioactive issue, says nixing AT&T–T-Mobile was right thing to do for competition, By John Eggerton -- Broadcasting & Cable, 2/13/2012 5:48:21 PM
5.Wall Street Journal, FEBRUARY 14, 2012, Sprint Adjusts Bonus, Executives Pay Won't Be Hurt by Costly Apple iPhone Deal, By ANTON TROIANOVSKI
6.Bloomberg, Sprint Nextel Boosts Bonuses by Excluding Cost of Apple IPhones, February 14, 2012, 12:24 AM EST, By Scott Moritz
7.Farm Futures, Officials Still Wrangling Over LightSquared, Posted on February 14, 2012 at 3:00 AM
8.COMMUNICATIONS DAILY, February 14, 2012 Tuesday, CAPITOL HILL, SECTION: CAPITOL HILL, LENGTH: 76 words
9.COMMUNICATIONS DAILY, February 14, 2012 Tuesday, SATELLITE, SECTION: SATELLITE, LENGTH: 163 words
10.TR Daily, LightSquared CITES LETTERS OF SUPPORT, 173 words, 13 February 2012
11.LightSquared (@LightSquared) Tweets
12.Coalition (@SaveGPS) Tweets
***Excerpts/Links to Full Text of Articles***
The Hill, Conyers concerned about delays in LightSquared approval, By Brendan Sasso, 02/13/12 01:00 PM ET
Rep. John Conyers (D-Mich.) urged Federal Communications Commission (FCC) Chairman Julius Genachowski to move forward with his agency's review of controversial wireless start-up LightSquared.
"I write to express concern about delays in the approval process involving LightSquared's proposed 4G-LTE wireless broadband network," Conyers wrote in a letter sent last Wednesday and obtained by The Hill on Monday. "I strongly urge the Commission to move with urgency to fully test potential solutions to the LightSquared-GPS interference issue employing transparent, fact-based methodologies, common-sense standards and independent testing facilities."
LightSquared has invested billions of dollars to launch a nationwide wireless broadband service, but the company ran into problems last year when tests showed its planned network could interfere with GPS devices.
As recently as last week, government officials have testified that the network could disrupt critical GPS devices, including flight safety systems.
LightSquared argues the problem is that GPS receivers are poorly designed and are receiving signals from outside their designated frequency bands. The GPS industry says its receivers are too sensitive to filter out the powerful signals from LightSquared's cell towers on nearby frequencies.
A growing number of Congressional leaders and state officials are urging the Federal Communications Commission to move forward with its review of LightSquared, the controversial startup that plans to build a national wireless broadband network using satellite spectrum.
Last week, Rep. John Conyers (D-Mich.) sent a letter to FCC chairman Julius Genachowski in support of the company and its plans.
"I write to express concern about delays in the approval process involving LightSquared's proposed 4G-LTE wireless broadband network," Conyers wrote in a letter sent last week. "I strongly urge the Commission to move with urgency to fully test potential solutions to the LightSquared-GPS interference issue employing transparent, fact-based methodologies, common-sense standards and independent testing facilities."
In total seven Congressional leaders have filed letters with the FCC supporting LightSquared's bid to build its network. And since December 13 state officials, including the governor of Mississippi have also sent letters of support to the FCC. Congressional leaders and state officials have been a mix of Democrats and Republicans.
What these lawmakers and government officials are saying is that the FCC should give LightSquared the green-light to build its nationwide wireless broadband network, because it would offer more competition and more bandwidth in the market at a time when competition and additional bandwidth are both very much needed.
Buried on page 1120 of President Obama's budget, the wireless startup LightSquared gets an indirect shout out. And not in a good way.
The appendix of the massive budget document released on Monday includes this provision:
"SEC. 618. None of the funds made available in this Act may be used by the Federal Communications Commission to remove the conditions imposed on commercial terrestrial operations in the Order and Authorization adopted by the Commission on January 26, 2011 (DA 11-133), or otherwise permit such operations, until the Commission has resolved concerns of potential widespread harmful interference by such commercial terrestrial operations to commercially available Global Positioning System devices."
That language is aimed squarely at LightSquared's proposed nationwide wireless network, which has been shown to interfere with GPS devices. The FCC has long said it won't give LightSquared the green light until the problem is solved, but that hasn't stopped Congress, and now apparently, the White House, from seeking to make sure agency doesn't move ahead with anything.
FCC Chairman Julius Genachowski said Monday that he was hopeful Congress would pass incentive auction legislation but worried that it would include provisions preventing the FCC from maximizing the overall value of the spectrum.
He also said he was pleased with the fallout of the network neutrality rules, saying they resolved a radioactive issue without putting crimp in investment or innovation.
Genachowski was speaking at the Flatirons broadband policy conference at the University of Colorado.
Flatirons executive director Phil Weiser, ex of the White House and a fan of the FCC's codification of network neutrality rules, asked whether the model of stakeholder participation and after-the-fact adjudication rather than more prescriptive rules would be a model going forward.
The chairman said that the challenge was the FCC had to deal with a changing world and still ensure baseline practices to ensure investment and innovation. He said he tried to bring a "certain humility" to the process without locking in a system. He said the rules were very limited -- "less than a page."
He put in a plug for multi-stakeholder solutions to resolving disputes about internet business practices-the FCC network neutrality rules include having industry players weigh in on what constitutes reasonable network management. He said that he is pleased with what has happened since the FCC adopted the rules -- they went into effect last fall.
While investors and analysts are still debating the ultimate benefits of Sprint Nextel Corp.'s high-stakes bet on the iPhone, the carrier's board has decided that bonuses for Chief Executive Dan Hesse and other employees won't suffer as a result.
Sprint said in a regulatory filing Monday that it won't count the impact of the iPhone on the company's profits in calculating employee bonuses. The company also won't count a benefit to the company's books from a network-sharing deal with start-up wireless carrier LightSquared, though that deal is stalled while Lightsquared tries to resolve concerns its network would interfere with global-positioning systems.
The decision had the effect of boosting Mr. Hesse's short-term incentive payout to $1.77 million for 2011 from the $1.53 million he would have earned had the iPhone's impact been counted. In addition, the payout under Mr. Hesse's long-term incentive plan for the year rose to 106.5% from 91.5% of the target.
A Sprint spokesman, Scott Sloat, said the changes were warranted because the company didn't know it would be carrying Apple Inc.'s iPhone or have a deal with LightSquared when performance metrics were put in place early last year. Mr. Sloat said a broad range of employees were eligible for the short-term compensation plan. Excluding the iPhone helped the bonus calculations, because they are based partly on Sprint's operating income or cash flow.
The tweaks to Sprint bonuses are the latest indicator of how Apple's wildly popular handset has affected the business of the nation's wireless carriers. Sprint, of Overland Park, Kan., the third-largest wireless carrier in the U.S., spelled out the magnitude of its bet on the iPhone in late October, saying it will cost at least $15.5 billion over four years, limiting its ability to turn a profit over that time.
Feb. 14 (Bloomberg) -- Sprint Nextel Corp., which sells Apple Inc.’s iPhone at a loss, says it excluded the device’s cost from its 2011 bonus calculations for eligible employees.
The move, which also excludes payments from partner LightSquared Inc., made short-term incentive bonuses 73.7 percent of target, up from the 63.7 percent amount that included these items. Sprint’s long-term incentive bonus rose to 106.5 percent from 91.5 percent of target with the adjustments, the Overland Park, Kansas-based company said yesterday in a filing.
Sprint, the nation’s third-largest wireless phone company, like bigger rivals Verizon Wireless and AT&T Inc. sells the iPhone at a loss to sign up customers on two-year contracts. Sprint, which has recorded five years of consecutive losses, said it sold 1.8 million iPhones in the fourth quarter and saw its subsidy costs increase about 40 percent.
When the U.S. Federal Communications Commission granted LightSquared the ability to develop its network of towers to deliver 4G LTE network services, and a kind of universal broadband, the news was met with some high-fives. That was a year ago. Now, it turns out controversy, interference claims regarding GPS signals and a host of other issues have piled on.
Today, LightSquared continues signing up new partners, but there's no clear evidence that the FCC is going to give its approval to allow the service to go into operation. Turns out, even after testing, there could be problems with the highest end GPS receivers used by aviation and perhaps the RTK box in your tractor cab.
Going past the claims and counter claims, the finger-pointing on both sides, the net result is this. Farmers remain concerned about the potential interference issues and those that wanted better high-speed Web access don't see that happening from this service.
However, the controversy has raised another issue, which could have regulators tightening up the rules on future GPS systems to help avoid these interference issues in the future. For now, your GPS unit is safe. That's good news with the 2012 planting season getting so much closer.
As the industry works through this issue, keeping in touch with your supplier may be your best bet. Officials at a hearing last week in Washington are working in new guidelines - important because FCC didn't have to consider the "space-based" concerns of GPS when approving a "land-based" system. In fact, that land-based system can interfere with GPS - to what extent, however, is still being worked out.
The FCC should move quickly to test possible solutions to the LightSquared/GPS interference fight, said Rep. John Conyers, D-Mich., in a Feb. 8 letter to FCC Chairman Julius Genachowski. "I write to express concerns about delays in the approval process involving LightSquared's" proposed network, he said. The "wireless sector is in need of increased competition" and the FCC should "act with urgency to resolve this issue as quickly as possible," said Conyers.
The FCC should consider "individualized circumstances" in determining terrestrial build-out requirements for mobile satellite service/ancillary terrestrial component operators, Globalstar said in a filing (http://xrl.us/bmrvze). The agency shouldn't use a "one-size-fits-all" approach in determining buildout conditions for Dish Network in the 2 GHz band or other MSS/ATC operators, Globalstar said. AT&T recently filed in the proceeding saying the agency should impose LightSquared's buildout requirements on Dish (CD Jan 30 p9). Such an approach might force MSS/ATC operators "to rely on less advanced technologies simply to comply with such requirements, rather than utilizing emerging technologies that will provide the greatest public interest benefits to consumers," said Globalstar. The company said it hopes to regain ATC authority later in the Big Low Earth Orbit band this year. It lost ATC authority in 2010 after it was found not to be in compliance with agency rules.
LightSquared, Inc., today released a number of letters to the FCC or the National Telecommunications and Information Administration from members of Congress, state elected officials, and its corporate partners voicing support for allowing the company to move ahead to deploy a nationwide 4G LTE (long term evolution) network. “Together this shows the growing base of support for LightSquared both inside and outside the beltway,” said Chris Stern, a spokesman for LightSquared. The letters of support came from 10 members of Congress, 13 state elected officials, and eight companies. A number of the letters were dated last month and this month. In the most recent congressional letter, Rep. John Conyers Jr., ranking member of the House Judiciary Committee, Feb. 8 expressed “concern about delays in the approval process involving LightSquared’s proposed 4G-LTE wireless broadband network.
I strongly urge the Commission to move with urgently to fully test potential solutions to the LightSquared-GPS interference issue employing transparent, fact-based methodologies, common-sense standards and independent testing facilities.”
Conyers concerned about delays in LightSquared approval, via @TheHill ow.ly/92YoL
Wolfe County Judge: Issue of vital importance to rural America. LightSquared spending over $14B in
CEO Codell Construction: “It is easy for a highway builder to understand: We need a bigger highway for our information” ow.ly/92KV1
Thanks to all who writing in support of our FCC petition. We’ll be tweeting a snapshot of many in favor of wireless broadband competition.
Coalition to Save Our GPS Clips
February 9, 2012
LightSquared was the topic of a hearing yesterday of the Subcommittee on Aviation of the House Committee on Transportation and Infrastructure. Testifying were three Coalition members—Airlines For America (A4A), the Aircraft Owners and Pilots Association (AOPA),and Garmin—as well as John Porcari, deputy secretary at the Transportation Department, and Scott Pace, director of the Space Policy Institute, Elliott School of International Affairs at George Washington University.
Thomas Hendricks, senior vice president at A4A, said in written testimony that LightSquared would have “ruinous effects” on aviation. “This matter needs to be put to rest,” he said. [Bloomberg
Porcari said LightSquared’s proposal was “simply not practical,” and that “further investment cannot be justified at this time.” [Inside GNSS
, The Hill
Scott Pace took exception with part of the ExComm’s proposal. “While a reasonable sounding statement, I would have preferred to avoid the word ‘standards’ and talk instead about GPS spectrum protection criteria. The latter is more likely to be useful in practice.” [Inside GNSS
Pace also said the FCC should have launched a rulemaking proceeding in response to LightSquared's waiver request. "One would have quickly seen that this was a non-starter," he said. [TR Daily
Garmin’s director of aviation GNSS technology was critical of LightSquared and the FCC. PNT sign-off should be required "when proceedings before the FCC include documented or substantiated claims of potential interference to GPS," he said. [TR Daily
AOPA President Craig Fuller pushed the "FCC to rescind waivers that keep this cloud" over industries using GPS. [Communications Daily
LightSquared complained that it was “denied a seat at the witness table.” A spokesman said: "Despite repeated requests, we were told there was no need to testify because LightSquared was not the subject of the hearing. We are dismayed but not surprised to hear today that this hearing was little more than a one-sided trial of LightSquared in absentia. It’s outrageous that a congressional hearing set up to examine factual issues was only focused on one side of the story — a side of the story supported by commercial GPS makers who designed faulty devices that depend on using spectrum licensed to LightSquared." [The Hill
The Coalition to Save Our GPS issued a press release after the hearing highlighting comments made by Pocari, AOPA, A4A and Garmin. The release, posted in full by The American Surveyor
, notes that Pocari said LightSquared is “not compatible” with numerous GPS-enabled aviation safety-of-flight operations and that “there appears to be no practical solutions or mitigations that would permit LightSquared broadband service, as proposed, to operate in the next few months or years without significantly interfering with GPS.”
report that Harbinger Capital Partners, the hedge fund that controls LightSquared, is paying a 15 percent interest rate for a $190 million loan from Jefferies Group Inc.
Business Aviation News
notes that the National Business Aviation Association (NBAA) has submitted a comment with the FCC:
·"The US GNSS (GPS) system must be protected from all sources of interference, intended or unintended," wrote Bill Stine, NBAA Director, International Operations. "Tens of thousands of aircraft depend on these GPS-based avionics for safe and dependable navigation information world-wide. The receivers were designed to meet the protection specifications within their spectrum allocations, both domestically and internationally, that are required of them. Can protections for the system be improved? Probably, but these will take decades to implement and cannot be accomplished retroactively," he added.
reports that British satellite operator Inmarsat, a LightSquared partner, has not received any takeover approaches according to an unnamed source, despite reports to the contrary.
explains that Sen. Grassley’s interest in LightSquared follows a pattern by Grassley of investigating federal agencies; and that while “LightSquared’s problems are real,” he “has is eye on a bigger prize: the Federal Communications Commission.”
To see what LightSquared and the Coalition to Save Our GPS are saying on Twitter, click here
A cite list and links to the full text of these and other articles follow.
1.Bloomberg Business Week, February 08, 2012 12:55 PM, LightSquared Would Ruin Aviation With System, Carriers Say
2.IDG News, LightSquared asks FCC to regulate GPS receivers, Stephen Lawson , 07.02.2012 kl 23:13
3.Chicago Tribune, Inmarsat has not received bid approaches: source, Paul Sandle and A. Ananthalakshmi, Reuters, 9:21 a.m. CST, February 8, 2012
4.Financial Times, February 8, 2012 2:46 pm, Sprint Nextel loss widens on iPhone costs, By Paul Taylor in New York
5.Fierce Wireless, LightSquared presses FCC for stricter GPS device standards, February 8, 2012, 11:12am ET | By Phil Goldstein
6.TWICE, LightSquared Wants FCC to Set GPS Receiver Standards, By John Eggerton -- TWICE, 2/8/2012
7.Bloomberg BNA, DISH Sees AT&T's Waiver Demands As ‘Setting It Up For Failure', Wednesday, February 8, 2012
8.The American Surveyor, LightSquared Update, Written by LightSquared, Wednesday, 08 February 2012
9.DSL Reports, Lightsquared Wants GPS Standards, A Hail Mary Pass to Keep Plans Afloat?, by Karl Bode 2/8/2012
10.National Journal Daily, WIRED IN WASHINGTON, Why Grassley’s Fuming: The crusty Iowan won’t stop his pursuit of telecom upstart LightSquared even if other Republicans have grown bored, By Josh Smith, Tuesday, February 7, 2012 | 9:30 p.m.
11.AOPA Online, Fuller: Protect GPS from current, future threats, By Sarah Brown, 02/08/2012
12.Rethink Wireless, Airlines join opposition to LightSquared project, Airlines for America claims the LTE system would have "ruinous effects" on navigation, while start-up calls for new GPS standards, By CAROLINE GABRIEL, Published: 8 February, 2012
13.Inside GNSS, Aviation Subcommittee Hearing Moves Beyond LightSquared to GPS Spectrum Protection Larger role for PNT ExCom is urged, 02/08/2012
14.NextGov, Aviation, GPS representatives warn of LightSquared's 'catastrophic' plans, BY JOSH SMITH, NATIONAL JOURNAL 02/08/2012
15.The Hill, Transportation official: LightSquared 'not compatible' with flight-safety devices, By Brendan Sasso, 02/08/12 03:43 PM ET
16.Mobiledia, LightSquared Pushes FCC Approval, Wants GPS Standards, BY MELISSA DANIELS | WED FEB 08, 2012 3:58 PM
17.Bloomberg, Harbinger to Borrow $190M at 15% Interest, By Katherine Burton and Anthony Effinger - Feb 8, 2012 4:46 PM ET
18.National Journal, Hearing Witnesses Can't Leave LightSquared Alone, By Josh Smith, February 8, 2012
19.Wireless Week, DOT Counters LightSquared GPS Standards Plan, By Maisie Ramsay, Wednesday, February 8, 2012
20.Helicopter Association International, Warnings of LightSquared’s Effects, Feb 8, 2012
21.Mobile Burn, LightSquared's 4G LTE network faces new opposition from aviation industry, News by Dan Seifert on Wednesday February 08, 2012
22.Broadcasting & Cable, LightSquared Complains It Was Left Out of GPS Hearing, Says hearing was a one-sided trial of LightSquared in absentia, By John Eggerton -- Broadcasting & Cable, 2/8/2012 5:15:31 PM
23.Bloomberg, Sprint Loss Widens After IPhone Demand Boosts Subsidy Costs, February 08, 2012, 5:27 PM EST, By Scott Moritz
24.AVweb, February 8, 2012, Aviation Subcommittee Suggests GPS Protections, By Glenn Pew, Contributing Editor, Video Editor
25.Flight Global, DOT lobbies for GPS buffer, By: JOHN CROFT WASHINGTON DC, Feb. 8, 2012
26.The American Surveyor, DOT Deputy Secretary Says LightSquared’s Plans “Not Compatible” with Safety-of-Flight Operations, Written by MAPuser, Thursday, 09 February 2012
27.Business Aviation News, NBAA tells FCC: GPS 'Must be protected from all sources of interference', Feb. 8, 2012
28.COMMUNICATIONS DAILY, February 09, 2012 Thursday, Deputy DOT Secretary and Aviation Industry Complain of LightSquared, SECTION: TODAY'S NEWS, LENGTH: 1160 words
29.Kansas City Business Journal, February 8, 2012 Wednesday, LightSquared asks regulators to clarify GPS standards, BYLINE: Staff, LENGTH: 137 words
30.TR Daily, GOVERNMENT, INDUSTRY REPRESENTATIVES CITE DAMAGING LightSquared GPS INTERFERENCE, 2353 words, 8 February 2012, By Paul Kirby
31.FINalternatives, LightSquared Pushes GPS Standards, Feb 9 2012 | 3:58am ET
32.FINalternatives, Harbinger Takes $190 Million Loan, Feb 9 2012 | 3:59am ET
33.LightSquared (@LightSquared) Tweets
34.Coalition (@SaveGPS) Tweets
***Excerpts/Links to Full Text of Articles***
Feb. 8 (Bloomberg) -- Philip Falcone's LightSquared Inc. wireless service would have “ruinous effects” on aviation because of signal interference and its plan for a nationwide data network should be withdrawn, an airline trade group said.
“This matter needs to be put to rest,” Thomas Hendricks, senior vice president at Airlines for America, said today in written testimony submitted for a U.S. House hearing.
LightSquared has sought final FCC clearance for its network since late 2010 against opposition from makers and users of global-positioning system devices including airlines that say the service would disrupt navigation gear in cars, tractors and planes in the U.S.
Signals from the proposed service disrupt many GPS receivers and no practical solution exists to let Reston, Virginia-based LightSquared operate soon, U.S. officials said Jan. 13 after nine months of tests.
LightSquared says GPS device makers should have planned to accommodate its use of airwaves near those occupied by navigation equipment. The company, which plans a wholesale high- speed data service covering 260 million people, said the airline group relies too much on information supplied by makers of GPS equipment.
LightSquared wants the U.S. FCC to set standards for commercial GPS devices to prevent what LightSquared calls interference with other wireless services.
In its latest salvo against the GPS industry, the would-be hybrid network operator filed a request on Tuesday for the Federal Communications Commission to initiate a proceeding on how to regulate some GPS receivers. Those rules would keep manufacturers from making navigation devices that use frequencies outside their assigned band, a problem that is at the root of interference issues that have kept LightSquared from launching its network, the company said.
It's not clear whether an FCC proceeding on this issue would have any effect on LightSquared's bid to operate an LTE (Long-Term Evolution) network on frequencies next to the GPS band. The carrier is required to start operating its network this year, and this type of rulemaking process can take years. LightSquared said that apart from the near-term issue of its network approval from the FCC, it wants to foster more certainty in the U.S. mobile industry.
"We filed this request because of a market failure," said Jeffrey Carlisle, the company's executive vice president for regulatory affairs and public policy. Though makers of wireless receivers have a basic obligation to make sure their devices don't use spectrum assigned to other uses, the GPS industry has been able to sell devices that use frequencies far from their assigned band, he said.
LightSquared's request is aimed specifically at devices that are supposed to use frequencies between 1559MHz and 1610MHz. That covers primarily commercial GPS devices, such as in-car navigation systems, and excludes some more advanced gear such as military receivers.
June 8, 2012
Extreme Tech, LightSquared is back from the dead - or is it?
By Ed Oswald
LightSquared sure has friends in high places. Four members of the US House of Representatives have sent a letter to the Federal Communications Commission asking Chairman Julius Genachowski’s help in finding suitable spectrum.
As it stands now, the frequencies that LightSquared has are unusable. Why? As our spectrum expert Neal Gompa explains, they’re right in the middle of some very important frequencies, including aviation radio communications, RNSS (Radio Navigation Satellite Service), and NASA’s space-to-earth research satellite services. This also includes significant interference to GPS services, which affects almost all of us.
It was for these reasons the FCC revoked LightSquared’s waiver to build a high-power LTE network in February. That announcement sent the company into a downward spiral, causing it to file for bankruptcy last month. In other words, the company appeared to have all but passed on. It existed, but its future seemed beyond bleak, despite the protestations of a few individuals.
Not so fast, say its proponents. According to The Hill, Reps. Jim Moran (D-Va.), Maurice Hinchey (D-N.Y.), Steve Rothman (D-N.J.), Rodney Alexander (R-La.) and Ander Crenshaw (R-Fla.) asked Genachowski to swap LightSquared’s spectrum with that of the Department of Defense. Both the FCC and the Obama administration have both made universal broadband access a priority, and they believed a spectrum swap is “the most resourceful and efficient way” to meet this goal, which would also save LightSquared from what appears to be an inevitable collapse.
The company’s day of reckoning is near. LightSquared’s creditors met this week and proposed a 90-day grace period in exchange for liens on company assets, Dow Jones reports. This makes the spectrum swap proposal all the more urgent, because it could be the last hope for LightSquared before creditors come rushing in.
May 15, 2012
LightSquared Inc. filed for bankruptcy, saying it will seek to resolve the concerns of U.S. regulators who thwarted the company’s plan to deliver high-speed wireless to as many as 260 million people.
LightSquared, based in Reston, Virginia, listed assets of $4.48 billion and debt of $2.29 billion as of Feb. 29 in a Chapter 11 filing yesterday in U.S. Bankruptcy Court in Manhattan. The filing followed intense negotiations with creditors, who had requested that the company’s backer, Philip Falcone, step aside. Falcone and the current management team will remain with the company, Terry Neal, a LightSquared spokesman, said yesterday.
Bankruptcy “is intended to give LightSquared sufficient breathing room to continue working through the regulatory process that will allow us to build our 4G wireless network,” Chief Financial Officer Marc Montagner said in a statement. Reaching agreements with U.S. agencies may take as long as two years, he said in court papers.
Harbinger Capital Partners, Falcone’s New York-based hedge fund, had invested about $3 billion in LightSquared and owned about 74 percent of it as of Jan. 27. Falcone also had served on LightSquared’s board. Creditors asked for Falcone’s departure when they gave the company a weeklong extension on April 30 to stave off a default and keep trying to renegotiate its debt, according to a person with knowledge of the matter.
LightSquared’s bankruptcy underscored tensions between the Federal Communications Commission and the telecommunications business, which is seeking more flexibility in how it uses airwaves. AT&T Inc. (T) Chief Executive Officer Randall Stephenson has blamed the FCC for not acting quickly enough to approve the acquisition and use of spectrum, creating a logjam for the industry.
Yesterday’s bankruptcy filing wasn’t an “option the company embraced quickly or easily, but it was necessary to protect LightSquared against creditors who were looking for a quick profit,” Falcone said in a statement. “We remain committed to our original mission, and I remain steadfast in my belief that a path forward exists that will satisfy and benefit all constituencies.”
LightSquared last week received a second weeklong extension from creditors, delaying a potential bankruptcy, a person with knowledge of the matter said at the time. Bondholders, including Carl Icahn, Andrew Beal and David Tepper earlier gave Falcone a deadline of April 30 to revisit a waiver that avoided triggering a technical default on its debt.
Icahn sold his $250 million in LightSquared debt holdings, Reuters reported May 6. Icahn received about 60 cents on the dollar for the holdings on May 3, after originally paying about 40 cents on the dollar months earlier, Reuters said, citing unidentified sources. Dish Network Corp. (DISH) Chairman Charlie Ergen, meanwhile, acquired $350 million of the debt, the New York Post reported.
Falcone’s plan for LightSquared depended on winning FCC approval to convert airwaves originally designated for satellite service to spectrum for land-based radio towers. LightSquared invested $4 billion in airwaves and reached deals with more than 30 partners, including Best Buy Co. (BBY)
LightSquared hit a roadblock in February when the FCC said it would withdraw preliminary approval for the company’s network after government tests found that the signals would interfere with global-positioning systems.
The decision followed a yearlong lobbying fight between LightSquared and GPS users and providers. The Coalition to Save Our GPS, a group formed to oppose LightSquared’s plans, included package shippers FedEx Corp. (FDX) and United Parcel Service Inc. (UPS), GPS-unit maker Garmin Ltd. (GRMN) and farm-gear maker Deere & Co. (DE)
Falcone said April 4 that he was considering bankruptcy for LightSquared, though he would rather get the government to swap his spectrum for that controlled by the U.S. Defense Department.
‘Continue Our Vision’
A voluntary filing would provide time to “continue with our vision, build the network and protect the company from creditors who are more interested in a quick flip,” Falcone said in an April 5 statement.
The company’s Canadian and Bermudan affiliates also filed for court protection yesterday. LightSquared employed 168 people in the U.S. and Canada, according to court papers. The company said its satellite business, with 300,000 users, generated revenue of about $30 million a year.
LightSquared’s biggest unsecured creditors include Boeing Satellite Systems Inc., owed $7.5 million, and Alcatel-Lucent, owed $7.3 million.
Debt includes $322.3 million outstanding on a term loan with U.S. Bank NA as agent and $1.7 billion outstanding under a credit facility with UBS AG (UBSN) and Wilmington Trust FSB as agents.
Harbinger’s main hedge fund, Harbinger Capital Partners Master Fund I, had $1.07 billion invested in LightSquared’s debt and equity as of Jan. 27, according to documents seen by Bloomberg News. The documents detailed a $190 million loan Harbinger took from securities firm Jefferies Group Inc. on Jan. 30 while it still awaited news from the FCC.
Harbinger’s $190 million loan, made at a 15 percent interest rate, was almost triple what the riskiest corporate borrowers pay. The loan would default if the FCC revoked its license on a final basis, and the license was no longer subject to review by the FCC or any court, according to the papers.
Trouble for the company began in December, when a draft summary of test results showed that LightSquared signals interfered with about 75 percent of GPS receivers. That same month, billionaire Icahn, along with Beal and Tepper, bought $300 million of the company’s debt sold by Farallon Capital Management LLC, two people told Bloomberg News.
The National Telecommunications and Information Administration advised the FCC on LightSquared’s proposed system. In February, NTIA’s administrator sent a letter to the FCC chairman saying there were “no mitigation strategies that both solve the interference issues and provide LightSquared with an adequate commercial network deployment.”
The opinion to block the approval caused a cascade of events for LightSquared. On March 16, Sprint ended an 11-year agreement to build, operate and share the network and compete with AT&T Inc. and Verizon Wireless. LightSquared paid Sprint $310 million in advance and Sprint said in a securities filing Feb. 27 that it would return $65 million of the payments.
LightSquared had originally agreed to pay Overland Park, Kansas-based Sprint $9 billion for the network duties and issue an additional $4.5 billion in service credits. The deal hinged on approval from the FCC.
On Feb. 28, Chief Executive Officer Sanjiv Ahuja resigned and the company appointed Falcone to the board as it began a search for a new CEO. LightSquared also cut 45 percent of its 330-member staff to preserve cash.
Since then, LightSquared failed to pay a network partner Inmarsat Plc $29.6 million due March 31. The company previously skipped a payment of $56.3 million due in February. LightSquared says it withheld payment because work specified in the contract wasn’t completed.
Falcone began investing in LightSquared’s predecessor, SkyTerra Communications Inc., in 2005. Harbinger wrote down the value of its LightSquared position by 59 percent last year because of concerns about winning regulatory approval.
The case is In re LightSquared Inc., 12-12080, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
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March 28, 2012