10.17.11

Through the looking glass again…

Posted in LightSquared, Operators, Regulatory, Spectrum at 8:38 am by timfarrar

‘If seven maids with seven mops
Swept it for half a year,
Do you suppose,’ the Walrus said,
‘That they could get it clear?’
‘l doubt it,’ said the Carpenter,
And shed a bitter tear.

In what seems like a reprise of LightSquared’s assertions in July that the FCC would reach a favorable decision in September (and indeed that they weren’t even “planning for the possibility that the FCC denies LightSquared the waiver when the decision comes out in September”), LightSquared is now asserting that the company “expects guidance from U.S. regulators by year’s end”. However, last week I spoke to several knowledgeable people about the testing and regulatory process and all were unanimous in their view that an FCC decision by December was utterly implausible.

The reasons for this become very clear once the current testing process is better understood. Those tests are being conducted by government personnel at an Air Force base (most likely White Sands or Holloman, where the previous round of government live sky testing was undertaken), beginning late next week and running through November 4. That testing is confined to “cellular and personal/general navigation” receivers as specified in the NTIA letter of September 9. As of last week, I understand that there was no intention to test the Javad precision receiver with the new prototype filter, and although LightSquared is trying hard to have that included in the testing process, it is certainly not part of the cellular test plan.

However, even if LightSquared succeeds in its efforts to get some testing done in the next three weeks, it would be essentially irrelevant, because the TWG tested 33 high precision and network GPS receivers in live sky conditions (and a total of 44 high precision and 13 timing receivers in an anechoic chamber) and these would all need to be retested before conclusions can be drawn about how to move forward. Indeed it is extraordinarily difficult just to come up with a test plan on this issue, given that circuit board level integration would likely be needed to incorporate the proposed filter into quite a number of these devices, which will take months of work.

After the current round of tests completes on November 4, it will take some time for the NPEF to write-up the results of that work, and I understand that no further testing is planned by the government in the rest of November. Indeed, it may only be possible to complete a summary of the cellular and personal/general navigation testing by November 30, and a complete report may be delayed into December. Once this is understood, LightSquared’s assertions simply become unsustainable.

Another, more worrying conclusion that emerged from my discussions last week is that the effects of the LightSquared debacle may now range much wider in terms of regulatory impact for the satellite industry. Comparisons were drawn with the ITAR backlash in the late 1990s, which has scarred the satellite industry for more than a decade, as another example of Congress running amok with a technical issue that has evolved into a political soundbite. In this context, DBSD and TerreStar may find it hard to gain a waiver without giving up something significant (such as half their spectrum) and the eagerness of the FCC to defend other satellite spectrum rights may also come under question.

The MSS industry in particular looks relatively vulnerable, as it has seen a significant decline in underlying service revenue growth this year, from an average of 7% growth in 2007-10 to less than 3% growth in 2011. As a result, this cannot be good news for a sector which has seen far more capex than can be justified by future MSS revenue prospects, and may now be faced with an even more challenging path to exploit the spectrum assets which have supported several of those investments.

2 Comments »

  1. TMF Associates MSS blog » Absolutely lacking in credibility… said,

    October 28, 2011 at 4:32 pm

    [...] plan are getting underway this week and will run into the first part of November. Notably, as I indicated earlier, high precision receivers are not part of this testing and so the testing needed for the FCC to [...]

  2. TMF Associates MSS blog » LS in Wonderland said,

    November 18, 2011 at 6:14 pm

    [...] move forward meant that “LightSquared is in Wonderland” (ironically a comparison that I also remarked on). Then in mid September, it became clear, after the FCC’s Public Notice mandated further [...]

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