The National Telecommunications and Information Administration told the FCC that federal agencies are worried that LightSquared's proposed wholesale LTE network raises "significant interference concerns" that the FCC should investigate before the network launches.
In a Jan. 12 letter to the FCC, NTIA Administrator Lawrence Strickling said that U.S. defense, transportation and homeland security departments want the FCC to defer a decision on allowing LightSquared to modify its spectrum licenses. Strickling said that GPS satellites as well as some maritime and aeronautical emergency communications might be affected. LightSquared, which is backed by the hedge fund Harbinger Capital Partners, is seeking a waiver from the FCC that will allow it to offer terrestrial-only service to customers, which would let wholesale customers provide terrestrial-only phones to subscribers.
Tom Surface, a LightSquared spokesman, did not comment specifically on Strickling's letter. "LightSquared is committed to seamlessly integrating our network into the current wireless environment which includes GPS," he told FierceWireless. "We remain committed to continuing to work with all parties involved to ensure that there is no harmful interference to GPS devices."
"We are reviewing Lightsquared's waiver request and, as we would with any request, we would ensure that any approvals would not result in harmful interference to current licensed users," Julius Knapp, chief of the FCC's Office of Engineering and Technology, said in a statement. "We look forward to working with all interested parties and we remain committed to moving forward with an open and transparent process that will consider all concerns filed publicly in the record."
LightSquared has said its wholesale LTE network will allow for terrestrial-only, satellite-only or integrated satellite-terrestrial services (via the terrestrial and MSS spectrum Harbinger scored through a merger with satellite operator SkyTerra). Currently, there are restrictions on the spectrum LightSquared owns that require any network that operates satellite handsets to offer both a terrestrial and satellite component. In the letter, Strickling noted that a fully terrestrial network would require more base stations than a combined satellite and terrestrial network would, thereby increasing the likelihood of interference.
LightSquared is conducting LTE trials in Baltimore, Denver, Las Vegas and Phoenix, with commercial launches planned by the third quarter of this year. The company, which has access to 59 MHz of spectrum, has said its network will consist of around 40,000 cellular base stations covering 92 percent of the U.S. population by 2015.
LightSquared inked a $7 billion contract with Nokia Siemens Networks in July to design and build the network, and analysts have speculated that NSN might provide LightSquared with vendor financing to defray the cost of building the network. However, analysts noted, LightSquared likely will need more money than that to meet its buildout timetable. In October, LightSquared inked new device deals with Nokia (NYSE:NOK), Qualcomm (NASDAQ:QCOM) and other companies, but did not announce any specific devices. The company has yet to publicly name wholesale partners.
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Article updated Jan. 14 with a statement from the FCC.