Report: LightSquared, Sprint strike long-term LTE network sharing deal

Despite the growing concern around LightSquared's interference issue with GPS signals, Sprint Nextel (NYSE:S) has reportedly reached a 15-year network-sharing deal with LightSquared valued around $20 billion, according to Bloomberg.

The deal calls for Sprint and LightSquared to build LightSquared's nationwide network, and Sprint will be a wholesale user of LightSquared.

"LightSquared and Sprint will jointly develop, deploy and operate LightSquared's 4G LTE network," wrote Philip Falcone to Harbinger Capital Partners investors in a letter obtained by Bloomberg. "Sprint will become a significant customer of LightSquared's 4G LTE network."

Falcone is the billionaire investor behind Harbinger Capital Partners, which is funding LightSquared's efforts. A Sprint spokesperson declined to comment to Bloomberg, and a LightSquared representative wasn't immediately available to comment to a query from FierceWireless.

The deal now casts doubt on Sprint's relationship with Clearwire (NASDAQ:CLWR), which has been struggling to find additional financing. LightSquared's aggressive rollout timeframe--if it's not stymied by the GPS interference issue--would help get Sprint up and running in the LTE market rather quickly to compete against Verizon Wireless' (NYSE:VZ) growing LTE network and AT&T Mobility (NYSE:T), which will begin rolling out LTE markets this year.

This would be LightSquared's biggest deal yet. It already has made deals with smaller players like Leap Wireless (NASDAQ:LEAP), Open Range and Best Buy. However, LightSquared's planned network is under fire from the GPS community for potentially interfering with GPS receivers. LightSquared recently delayed a report on the topic to the FCC until July 1.

During the past several months, Sprint repeatedly has been rumored to be in discussions with LightSquared, and LightSquared's CEO recently confirmed the talks. And the Wall Street Journal earlier this week reported LightSquared received approval from its creditors to have Sprint take control of its spectrum should LightSquared default on its debt.

For more:
- see this Bloomberg article
- see this FierceWireless article

Related Articles:
Seybold's Take: Why LightSquared's proposed system will interfere with GPS
LightSquared CEO Ahuja confirms talks with Sprint
Two government agencies say LightSquared's network interferes with GPS
FCC's Genachowski: We won't let LightSquared operate without GPS interference resolution
Report: Sprint, LightSquared near $2B/year network-sharing deal

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