I see LightSquared has both a lot of momentum and inertia at the moment. I don’t have volumes to say about them at the moment, but thought I would try to summarize with some pictures to save some of their words….
Firstly, the momentum. LightSquared received permission (a waiver) from the FCC to use the GPS (MSS) spectrum for LTE under the Ancillary Terrestrial Component rules. They managed to successfully launch and perform test calls on their first satellite, SkyTerra-1, in November (2010 of course) and they obtained $586M funding from JP Morgan and UBS in late February (2011.) After that, they secured deals to provide 4G LTE to OpenRange and roaming agreement with Cricket.
and announce that deal at the CTIA show in Orlando, FL.
So now that brings us to their inertia…. There has been a lot of opposition to renewing their waiver and allowing them to proceed from many sides. Firstly there aren the usual haters/suspects such as direct competitors Clear etc…then GPS industry users/groups
like New America Foundation, Media Access Project, Free Press and Public Knowledge (collectively, “the Public Interest Organizations”), then the government like DOT, DOD, DHS and so on. Most of the angst is directed towards MSS L OOBE (out of band emissions) to GPS and other sat services…More to follow as the story evolves…
LightSquared CEO Sanjiv Ahuja delivers a speech at CTIA 2011. (Credit: CNET/Marguerite Reardon)
ORLANDO, Fla.–LightSquared, a company that is building a nationwide 4G wireless network, said Wednesday that it has signed a deal with Best Buy to offer 4G wireless service.
The announcement follows a roaming agreement LightSquared announced Monday with wireless carrier Leap Wireless.
LightSquared is building its new wireless network using spectrum that had been designated for satellite communications. The company received a waiver from the Federal Communications Commission in January to use the spectrum to build its LTE-based network. And it plans to offer the service commercially by the end of the year. The service will offer both a satellite and a land-based LTE (Long-Term Evolution) network.
The company plans to run its network as a wholesale business, which means it will not sell services directly to consumers. Instead, LightSquared’s potential customers will be cable operators looking to offer wireless service, small wireless operators looking to extend their data footprint, and retailers and device makers looking to integrate wireless data services into their own product offerings.
During a keynote address here at the CTIA 2011 trade show, LightSquared CEO Sanjiv Ahuja said this business model gives LightSquared an edge over other wireless broadband providers because the company will not have to spend money on marketing and consumer support. He also said that LightSquared could be a game changer in the wireless industry, helping smaller carriers and other players offer an alternative to current consumer focused wireless service providers.
As part of the conditions of the waiver, the FCC is requiring that LightSquared build a network that covers 100 million people by 2012 and 260 million people by 2015. Ahuja said the company should meet or even exceed those goals.
The company has said previously that it’s been negotiating deals with at least 15 potential customers. Best Buy is the biggest customer so far to sign up with LightSquared. The retailer will use LightSquared’s service to deliver 4G wireless data service to consumers through its Best Buy Connect wireless service. Currently, Best Buy uses Sprint Nextel’s 3G wireless network and Clearwire’s 4G WiMax service. Ahuja said trials will begin in the first quarter of next year.
LightSquared’s business model, if effective, could make the wireless market more competitive, even as the industry is facing consolidation. AT&T’s announcement earlier this week to acquire T-Mobile USA for $39 billion is the latest example of such consolidation. And it has raised eyebrows of consumer advocates, who fear that consumers will have fewer choices in the market.
But Ahuja said during his speech that LightSquared will offer smaller players a chance to compete with the bigger carriers because its network will be nationwide. This is exactly why Leap Wireless has signed on with LightSquared. The wireless operator is the seventh largest carrier in the U.S. It operates in 35 states nationwide, but only has 5 million customers. It’s looking to become more of a national player, but does not have the footprint to compete aggressively with larger nationwide carriers.
But LightSquared still faces challenges that could derail its big ambitions. First of all, building such a nationwide network is expensive. Clearwire, which had funding from Sprint, Comcast, Time Warner, Google and Intel, is struggling to come up with the cash to finish building its nationwide WiMax network.
Ahuja tried to allay funding fears by saying during his speech that LightSquared is well capitalized. The company has secured $14 billion in private funding over the next eight years to build its network.
Another potential problem is that GPS providers say the LightSquared network will likely interfere with their services, an issue that the FCC will have to look into as the company prepares to build its network.
LightSquared and Open Range Partner to Expand Deployment of Nation’s First 4G LTE Wireless Broadband and Satellite Network to Rural American Communities
RESTON, Va., March 11, 2011–LightSquared™, the nation’s first, wholesale-only integrated 4G-LTE wireless broadband and satellite network, and Open Range Communications, a broadband wireless provider of Internet and digital phone service to rural American communities, today announced that they have entered into an agreement in principle to establish a multi-year strategic network partnership.
This partnership represents a major step toward fulfilling the promise of the Federal Communications Commission’s (FCC) National Broadband Plan. As stated in the plan, “Broadband can and must serve as a foundation for long-term economic growth, on-going investment and enduring job creation.” This partnership underscores the goals of this plan by providing benefits to consumers, businesses, healthcare, tribal organizations, public safety and other government users located in or traveling to rural communities and who are seeking access to the latest generation of mobile services.
The partnership is expected to include a licensing arrangement whereby Open Range will lease LightSquared’s L-band spectrum. This wholesale agreement will enable Open Range to sell LightSquared’s next generation satellite capacity. The partnership will also include a 4G nationwide reciprocal roaming arrangement. Under the arrangement, the companies will collaborate on the design, build-out and operation of Open Range’s network as well as on product and service evolution.
The arrangement, which is set out in an Initial Network Agreement, is subject to the execution of definitive agreements, which are expected to be finalized as soon as possible. It is also subject to review by the United States Department of Agriculture’s Rural Development Utilities Program, and approval of spectrum lease arrangements by the FCC.
“Open Range’s unwavering vision is for ubiquitous High Speed Internet Service at an affordable price across all of rural America. The partnership with LightSquared helps fulfill our vision of delivering the most advanced and interoperable broadband wireless communications services to un-served and underserved rural communities across America. The combination of satellite and Ancillary Terrestrial Component (ATC) services provides the only feasible way to offer meaningful ubiquitous nationwide rural broadband and meet President Obama’s goals,” said Open Range Chief Executive Officer and founder Bill Beans.
“This partnership enables LightSquared to provide an enlarged and seamless nationwide 4G-LTE footprint to all of our retail partners and their customers, and is part of LightSquared’s planned commercial service which will result in billions of dollars of investment, offer consumers a new wireless competitor and create tens of thousands of jobs across America,” said Sanjiv Ahuja, chairman and chief executive officer of LightSquared.
LightSquared’s mission is to revolutionize the U.S. wireless industry. Through the creation of the first-ever wholesale-only nationwide 4G-LTE network complemented by satellite coverage, LightSquared offers people the speed, value, and reliability of 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—at a competitive cost and without retail competition from LightSquared.
For further information about LightSquared, please go towww.LightSquared.com.
About Open Range
Headquartered in Greenwood Village, Colorado, Open Range Communications is a unique public and private partnership. The company was approved in 2009 for a loan by the United States Department of Agriculture’s Rural Development Utilities Program (RDUP) to deliver High Speed Wireless Internet to more than 500 communities across 17 states. This Broadband Access Loan of $267 million loan (the largest in USDA history) was made possible through the positive and combined efforts of the USDA’s RUS and FCC. Open Range received additional private equity funding on January 9, 2009 through an investment of $100 million from One Equity Partners (OEP), the private equity arm of JPMorgan Chase & Co. The OEP investment satisfied the RDUP’s loan terms, making the funds available to Open Range.
SAN DIEGO AND RESTON, Va. – March 22, 2011– Leap Wireless International, Inc. (NASDAQ: LEAP), a leading provider of innovative and value-driven wireless communications services, and LightSquared™, the nation’s first wholesale-only integrated wireless broadband and satellite network company, today announced that they have entered into a long-term 4G roaming agreement. The new arrangement will allow Cricket, Leap’s operating subsidiary, to supplement the LTE coverage that Cricket plans to deploy across its own networks over the next few years with LTE roaming services from LightSquared.
““Our business progress demonstrates how data services are increasingly important to our customers, as evidenced by our customers’ significant uptake of smartphones and data-focused, higher-ARPU service plans,” said Doug Hutcheson, Leap’s President and CEO. “We intend to deploy our own LTE networks beginning this year to complement the existing nationwide 3G services we currently offer to customers. This new roaming arrangement will allow us to offer customers an even-greater 4G service area as LightSquared expands its own network. We believe that the broad coverage resulting from this business agreement will enhance our ability to offer compelling products and services and allow us to strengthen our retail relationships and distribution capabilities. It will also give us flexibility to access additional 4G capacity where needed as data-centric devices become more popular and require more and more bandwidth.”
““Leap is a fantastic company and we’re excited to do business with them,” said Sanjiv Ahuja, chairman and CEO of LightSquared. “Cricket customers’ appetite for wireless data is growing exponentially and in ways no one could have envisioned even a few years ago. By providing a wholesale-only nationwide 4G LTE network complemented by satellite coverage, LightSquared will help Leap meet its customers’ demand for universal, affordable broadband connectivity. We are fully committed to delivering our roaming services on time and with the quality, speed, coverage and capacity required to support Leap’s business needs.”
Financial and other terms of the roaming agreement were not disclosed.
Leap provides innovative, high-value wireless services to a fast-growing, young and ethnically diverse customer base. With the value of unlimited wireless services as the foundation of its business, Leap pioneered its Cricket®service. The Company and its joint ventures now operate in 35 states and the District of Columbia and hold licenses in 35 of the top 50 U.S. markets. Through its affordable, flat-rate service plans, Cricket offers customers a choice of unlimited voice, text, high-speed data and mobile Web services. Headquartered in San Diego, Calif., Leap is traded on the NASDAQ Global Select Market under the ticker symbol “LEAP.” For more information, please visitwww.leapwireless.com.
Top officials at the Defense and Transportation departments sharply criticized the Federal Communications Commission for giving the go-ahead for a new hybrid cellular and satellite network that could interfere with Global Positioning System navigation and timing elements. FCC failed to consider sufficient input from federal stakeholders, they said.
In addition, Deere and Co., which manufactures farm and construction equipment, told FCC the network planned by Reston, Va.-based LightSquared could cause “devastating interference” to the GPS systems it has developed for precision farming. Those systems reduce the cost of food production in the United States by as much as $3 billion a year, the company said.
Deputy Secretary of Defense William Lynn and Deputy Secretary of Transportation John Porcari said in a letter to FCC Chairman Julius Genachowski last Friday their departments were not “sufficiently included” in an FCC ruling in January that conditionally allowed LightSquared to begin developing its nationwide broadband network, which includes 40,000 cellular towers and a satellite launched in November 2010.
Lynn and Porcari said the LightSquared terrestrial network increases the potential for intererference to GPS receivers. FCC needs to include the two departments as tests are conducted through June, they said.
FCC’s plans for LightSquared demonstrate “lack of inclusiveness regarding input from federal stakeholders. In particular, active engagement with DoD and DOT, the national stewards and global providers of the [GPS] services, is essential to protect this ubiquitous defense, transportation and economic utility,” the letter said.
The regulator should ensure that a “comprehensive study of all potential interference” by the LightSquared network is included in the studies done by the company and the GPS Industry Council, the department leaders said.
Jeff Carlisle, executive vice president for regulatory affairs at LightSquared said in a statement, “We are sensitive to concerns about potential interference, which is why we have fully committed ourselves to a comprehensive process that will ensure our network can coexist with GPS devices and agreed to only launch commercial operations when this process is completed to the FCC’s satisfaction.”
Carlisle added, “As part of this effort we are cooperating with federal agencies, the GPS community and GPS engineers in a transparent and technically accurate testing program to address issues relating to GPS receivers. We are also providing equipment and personnel to the U.S. Air Force’s Space Command, NASA and other federal agencies to help them begin their own testing processes.”
GPS operates in the 1559-1610 MHz frequency bands and the LightSquared network operates in the nearby 1626.5-1660.5 MHz band. In filings with the regulator, aviation groups such as the Aircraft Owners and Pilots Association said FCC failed to evaluate the “substantial public interest harms” the company’s network would cause by “significant desensitization” of GPS receivers.
The Federal Aviation Administration plans to build its Next-Generation Air Transportation System around GPS, which will provide highly precise signals needed for en route navigation and landings.
Deere, in its filing with FCC Tuesday, said the LightSquared system could knock out its StarFire precision farming systems, which use specialized equipment to increase the accuracy of GPS signals from 65 feet to 4 inches. The system helps farmers precisely determine the amount of seed and fertilizer needed throughout their operations, Deere said.
LightSquared said interference is not caused by its system, but by sensitive GPS receivers that “see” into the frequency band used by LightSquared. Not all GPS receivers do that, Carlisle said, and one possible mitigation strategy is to replace GPS receivers that pick up the LightSquared signal.
The LightSquared industry group filed its first progress report with the FCC March 15, detailing test plans and types of receivers it expects to use in those tests. The final report is due in June. Federal representatives on the working group include: Michael Biggs, FAA senior engineer; Air Force Capt. Anil Hariharan, chief of GPS spectrum engineering in the joint service GPS Directorate; Fred Moorefield, technical director and director of strategic planning in the Air Force Spectrum Management Office; and Brian Ramsay, spectrum policy specialist in the NASA Space Communications and Navigation Program Office.
By Dan Namowitz
The Federal Communications Commission (FCC) failed to balance a satellite network operator’s claim of public interest against the “massive problems” that expansion of its network could cause for the aviation industry and other GPS users, AOPA said March 29.
AOPA, working with a multi-industry coalition, is urging the FCC to reverse a waiver it granted to communications network operator LightSquared to “repurpose” a portion of the satellite spectrum neighboring that used by GPS. By granting the waiver, AOPA said, the FCC failed to give proper weight to the “substantial evidence” in the record that the network expansion—with its 40,000 required ground stations—could cause “significant desensitization” of GPS receivers “and massive problems that issue would create for the aviation industry.”
The severity of the potential impact made it inappropriate for the FCC to merely impose as a condition of approval a waiver with a requirement that LightSquared work with users—in a group to be co-chaired by the company—to study effects of its network on GPS, wrote AOPA Senior Vice President of Government Affairs Melissa Rudinger in a March 29 rebuttal of LightSquared’s response to comments urging reconsideration of its approval to expand its mobile satellite services network’s use of the spectrum. That condition left LightSquared itself in a position to determine whether the relief it had received was “technically sound.”
“Such an investigation should have been headed by the [FCC International] Bureau or a neutral third party, not LightSquared,” she wrote.
Concern has been growing about the threat to GPS in the aviation community and other industries since LightSquared applied for the waiver. On March 10, AOPA announced that it had joined the Coalition to Save Our GPS, whose goal is to protect the “national utility” that GPS represents against the threat of signal degradation or interference.
Federal officials have also expressed concerns about the impact on GPS, as well as the structure of the working group set up by the FCC. Following a meeting between Transportation Secretary Ray LaHood and industry leaders in Wichita, Kansas, officials criticized the lack of “federal stakeholders” being included in the GPS review process. In ajoint letter to the FCC, Deputy Secretary of Transportation John D. Porcari and Deputy Defense Secretary William J. Lynn III asked for clarification about how national security and transportation safety issues would be addressed.
The General Aviation Manufacturers Association (GAMA) welcomed the officials’ active engagement in the LightSquared proceedings.
“We are very appreciative that Secretary LaHood has taken up this issue in partnership with Defense Secretary [Robert] Gates, since the consequences of disruption to GPS signals are far reaching,” said Gary Kelley, vice president of marketing and company officer for Garmin International and a member of the GPS coalition, in a GAMA news release.
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