LightSquared lands deadline extension from Sprint

Sprint has given embattled LightSquared a 30-day extension on what had been a Dec. 31 deadline for LightSquared to gain Federal Communications Commission approval for usage of its network spectrum.

Obtaining FCC approval by Dec. 31 had been a condition of the long-term network and spectrum sharing agreement that Sprint and LightSquared signed last July. The 15-year agreement is worth about $9 billion to Sprint, and wholesale operator LightSquared has said it could save $13 billion over the next several years from Sprint's hosting help as both companies proceed with LTE network projects. LightSquared has signed up several would-be wholesale service customers, including Sprint.

However, LightSquared continues to be hampered by criticism that operating an LTE network in its L-band spectrum potentially could interfere with GPS systems. Last month, LightSquared appealed to the FCC to approve its network after an initial round of government testing showed lack of interference with mobile phone GPS functions. The same tests, however, did show some interference with many general purpose GPS receivers. Also, as of Dec. 21, the National Telecommunications and Information Administration was still in the midst of conducting more GPS-related tests, with the likelihood that those tests would not be completed until sometime this month at the earliest.

The hosting agreement includes the provision for Sprint to terminate arrangement if LightSquared failed to gain FCC approval by Dec. 31. Some observers have wondered if Sprint's patience with LightSquared ongoing struggles could soon run out, though Sprint had seemed to indicate in previous statements that it would be willing to grant an extension. The deadline extension is a sign Sprint is willing to remain on hold a while longer, and it had at least nine billion reasons to make that decision.

For more:
- see the Dow Jones Newswires story

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The government said initial tests found some GPS interference
LightSquared has attempted to resolve the interference issue