12.20.10

What does the MEXSAT order mean for L-band coordination?

Posted in LightSquared, Operators, Regulatory, Spectrum at 1:54 pm by timfarrar

Today, Boeing announced an agreement with the Mexican government to build the MEXSAT system, including two new L-band satellites with 22m diameter antennas (which appear to be a copy of the SkyTerra-1 and 2 satellites), plus a smaller FSS satellite which will be purchased from Orbital Sciences. This order has been the subject of speculation for several months, because of its implications for the future of Satmex.

However, it also has significant implications for L-band coordination, because the March 2010 order, which approved LightSquared’s re-use of the spectrum assigned to Mexico’s previous generation Solidaridad satellites, did not grant “any authority to share spectrum with [Mexico's planned next generation] system in the absence of coordination”. Indeed the Mexican government’s comments in that proceeding claimed that the power spectral density (PSD) level proposed by SkyTerra/LightSquared “would be harmful to service operating levels circulating through the MEXSAT network”.

With LightSquared now trying to gain approval for its updated business plan, over the protests of the GPS Industry Council and others, and move forward with the buildout and commercial launch of its ATC network next year, this new Mexican system means that there will have to be renewed efforts to reach a new L-band coordination agreement. It will also be interesting to see whether this has any additional implications for the LightSquared business plan, given that LightSquared asserted in requesting approval of its application that the “proposed reuse is critical to the successful deployment of SkyTerra’s next-generation system, particularly with respect to accessing spectrum that is sufficiently contiguous to provide broadband services”.

12.10.10

Will LightSquared benefit from the net neutrality debate?

Posted in LightSquared, Operators, Regulatory, Spectrum at 10:14 am by timfarrar

Apparently following the principle that the enemy of my enemy (i.e. AT&T and Verizon) is my friend, LightSquared has garnered significant support for its business plan from the Nevada State Democratic Party, the Progressive Leadership Alliance of Nevada, and other organizations, who you wouldn’t normally expect to see cheering for “one of the world’s richest hedge fund managers“. However, absent from the debate (at least so far) are those who applauded the actions of the FCC when it “pulled the plug on a plan to use a rigged auction to award spectrum to a telecom start-up [M2Z] backed by billionaire venture capitalist and Democratic campaign donor John Doerr”, who might be expected to be opposed to a plan that could very well prevent the US Treasury from gaining “compensation for the step-up in value” when MSS spectrum is used for terrestrial-only services.

It is notable that LightSquared’s application comes in the midst of the net neutrality debate, with proposals apparently set for a vote at the FCC’s December 21 meeting. With rumors that the proposals will largely exclude wireless networks from having to comply with net neutrality obligations, it seems very plausible that a deal could be in the works to approve LightSquared’s open access network at the same time, and thereby demonstrate to net neutrality advocates that there will be at least one 4G wireless network that will undertake to comply with net neutrality rules.

12.09.10

LightSquared garners support for its new business plan

Posted in LightSquared, Operators, Regulatory, Spectrum at 4:01 pm by timfarrar

A host of comments have now been filed with the FCC in response to LightSquared’s recent updates to its ATC business plan. These include supportive comments from numerous individuals and “public interest organizations“, plus notably a comment from T-Mobile, which also urges the Commission to rule on LightSquared’s application expeditiously, rather than deferring it to a more general proceeding.

LightSquared itself filed reply comments, justifying its showing of “integrated service”, although it is pretty easy to identify areas where LightSquared has carefully skated around the issue. For example, LightSquared argues that its arrangement with Qualcomm “eliminates price as a factor for end users deciding whether to use dual-mode handsets”, although of course if a handset designer can leave out the satellite functionality (especially if it would need a relatively large internal antenna similar to that inside the Genus phone) then the handset could be smaller and more attractive to end users (as Leap Wireless and others have argued in the NPRM/NOI proceeding).

It now seems that the FCC has a decision to make in the very near term, about whether to approve the modification request and potentially help Harbinger move forward with potential deals such as that apparently envisaged with Leap Wireless, or to delay approval and potentially risk the future of LightSquared and Harbinger. Certainly Harbinger appears to be under considerable pressure from the recent LightSquared satellite antenna failure, and continued scrutiny in the press, and at the end of this month, Harbinger’s investors will have to decide whether or not to follow through with their redemption requests. LightSquared will presumably also have to pay over $100M to Boeing on account of its payment deferrals in the next week or two, and exercise its Phase 2 option with Inmarsat which was promised by the end of the year.

12.06.10

Friends in high places?

Posted in Financials, LightSquared, Operators, Regulatory, Spectrum at 12:02 pm by timfarrar

LightSquared has received significant backing from the highest levels of FCC as the company moves forward with deployment of its 4G LTE network, including several statements by FCC Chairman Genachowski in support of LightSquared’s public unveiling in July and its plans to donate 2000 handsets to the Indian Health Service, announced in September. Now we will have to wait and see whether the FCC will act to approve LightSquared’s recently updated ATC business plan, which met with significant opposition from cellular interests last week. These comments requested that this “novel re-interpretation of the Commission’s integrated service requirement” be deferred for consideration as part of the currently pending MSS rulemaking proceeding, which would likely delay any resolution of the request by many months.

Unfortunately it seems that LightSquared doesn’t have the friend in high places that really matters, as an act of God appears to have left the SkyTerra-1 satellite (which was launched on November 14, carrying “with it, the ambitions of one of the world’s richest hedge fund managers, Philip A. Falcone“) experiencing problems in deploying its 22m L-band antenna. While we probably won’t know until the end of this month whether or not the problem can be solved, if it can’t, then the satellite would very likely be unable to communicate with LightSquared’s handsets, and the company would be forced to launch the SkyTerra-2 satellite (which may or may not have been intended to remain a ground spare). Space News estimated last week that this could probably be done “within a year”, but that was before Sunday’s Proton rocket failure, which fell into the Pacific Ocean along with its cargo of 3 Glonass satellites. Although SkyTerra-2 currently is listed as having a March 15, 2011 launch date, it seems hard to imagine that it would be possible to go ahead with the launch at that point in time, unless the antenna was uninsured (as happened with TerreStar-1 in the wake of the Solaris problems last year).

In the meantime, it will be interesting to see whether and how LightSquared moves forward with the buildout of its terrestrial LTE network, which it is required to construct “without regard to satellite service” under the second of the conditions agreed with the FCC in March this year. Given the apparent potential for conflict between this condition and the original ATC gating criteria (which require satellite service to be commercially available before the ATC network is launched), it will be particularly fascinating to see what the FCC does next.