Industry Updates

LightSquared offers plan to solve problem of GPS interference following last week's Sprint deal

Monday, June 20, 2011

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Opalesque Industry Update – As Philip Falcone reportedly faces $1bn in redemption requests LightSquared, the broadband company that his firm has bet enormous stakes on, announced on Monday that it has “a comprehensive solution to the problem of interference with Global Positioning System (GPS) receivers.”

This makes for the second round of positive news for Falcone, who saw investors leave in the wake of a personal loan he took out of a fund earlier this year, and then again this spring as his investment in LightSquared has faced numerous hurdles, including the recent reports that it interferes significantly with global positioning services. However, Falcone’s luck may have turned as late last week LightSquared announced a $20bn/15 year deal with Sprint and this week the firm has announced the plan to solve the GPS problem. “This is a solution which ensures that tens of millions of GPS users won’t be affected by LightSquared’s launch. At the same time, this plan offers a clear path for LightSquared to move forward with the launch of a nationwide wireless network that will introduce world class broadband service to rural and underserved areas which still find themselves on the wrong side of the digital divide,’’ said Sanjiv Ahuja, LightSquared Chairman and CEO in a statement released by the firm.

LightSquared has explained that there is another block of 10MHz that the firm can use, which will not create the interference risk caused by the initial block it was using. “LightSquared recently reached an agreement with Inmarsat that will allow the rollout of its wireless network in a timeframe that keeps to the original business plan and is in accordance with regulatory requirements. As part of this revised plan, LightSquared will modify its FCC license to reduce the maximum authorized power of its base-station transmitters by over 50%. This action will limit LightSquared to the power it was authorized to use in 2005, which will provide additional protection to GPS,” says the firm.

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