06.04.11

FCC’s concession: is it enough?

Posted in Financials, LightSquared, Operators, Regulatory, Spectrum at 9:49 am by timfarrar

A first, very modest concession has now emerged from the FCC Chairman over the process for authorizing LightSquared’s commercial operations, in a letter dated May 31 to Senator Chuck Grassley. This letter is a response to the demand from Grassley on April 27 for records of communications between and within the FCC related to Harbinger and LightSquared. The May 31 letter completely ignores Grassley’s specific request and also fails to addresses the concerns he expressed about the very short comment period originally set for the November proceeding, which as the CTIA pointed out, was “unlike most satellite modification filings”. Unsurprisingly, Grassley is therefore still upset about the FCC’s “lack of transparency in this case”.

However, the letter does make one modest concession, in that it promises that the Commission “will establish a public comment cycle and give all parties further opportunities to present their views”. This was one commitment that was missing from the January 2011 waiver order, and was of considerable concern to the GPS community, although it does not go as far as the Save Our GPS Coalition requested, which was for a comment period of “at least 45 days” and for “further FCC actions [to] take place with the approval of a majority of the commissioners”.

The FCC Chairman is presumably very cognizant of the language in the House version of the National Defense Authorization Act (NDAA), which would forbid the FCC from authorizing LightSquared’s commercial operations until GPS interference concerns are resolved, and wants to prevent similar language from being included in the final bill. Whether his concession on a public comment period is sufficient to achieve that remains to be seen, especially given his conclusion that “I remain focused on ensuring that the Commission takes full advantage of the incredible economic opportunities that underutilized spectrum presents. This includes the opportunity presented by LightSquared…”

However, even if the FCC is successful in forestalling Congressional intervention, a public comment period (of say 30 days or longer if it includes time for reply comments) will certainly push back the timeline on which a final ruling from the FCC can be expected to at least the end of July, and more likely sometime in August. Unless and until the GPS interference issue is resolved, it hardly seems likely that Sprint will want to finalize a network sharing deal with LightSquared, or that LightSquared will be able to raise the money to pay for that buildout. Thus it appears that a LightSquared IPO in July is certainly off the table, and the supposed network sharing deal with Sprint seems to be no more imminent than it was in mid-March (when supposedly LightSquared was about to announce a deal with Sprint at CTIA) or in mid-April when these reports last emerged.

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