02.07.12

That’s all folks!…but awkward questions remain

Posted in LightSquared, Operators, Regulatory, Spectrum at 10:18 pm by timfarrar

So the Looney Tunes cartoon (think Wile E. Coyote) that has been LightSquared over the last year appears to have finally run its course, with LightSquared today effectively conceding defeat by asking the FCC to initiate what will inevitably be a multi-year receiver standards proceeding (followed by an even longer transition period for any such standards to come into effect). Today’s press conference was called at very short notice and appears to have happened in response to the impending release of the NTIA’s report and recommendations, which are also likely to call for an investigation into potential future receiver standards and indicate that LightSquared should not be allowed to operate its terrestrial network in the meantime.

Rather than waiting until March for comments on LightSquared’s Petition for Declaratory Ruling, the FCC now appears determined to clean up any loose ends and get this issue off its plate as soon as next week, before Congressional hearings into the procedures it followed in granting the LightSquared waiver get underway. Indeed the FCC Chairman stated after the Public Notice was issued on Jan 27 that the Petition for Declaratory Ruling would not affect the timeline for the FCC’s next steps. It therefore wouldn’t be unreasonable to suppose that LightSquared may have been given a strong hint that by asking for a receiver standards proceding themselves they could avoid a harsher ruling from the FCC mandating such a proceeding.

Of course, the FCC may also be looking to deflect attention from its own release of some documents in response to the numerous Freedom Of Information Act requests that have been filed. Buried in this release are numerous damaging documents which raise questions about the apparent coordination of LightSquared’s November 2010 waiver request with FCC staff prior to it being filed (and incidentally disclose LightSquared’s pricing plan of $6 per Gbyte for terrestrial capacity and $10 per Mbyte for satellite capacity, as well as the overall planned system capacity of 2800 Tbytes per hour terrestrially and 100 Gbytes per hour via satellite) which led to it being put out for comment immediately. It is also unclear whether this meeting with LightSquared on November 16 was disclosed in any ex parte filing. Indeed LightSquared had also been discussing with the FCC a change to their business plan to only launch one satellite, which has never been disclosed publicly (except in one accidental comment that I blogged about at the time).

However, potentially even more damaging are documents related to the conditions imposed on LightSquared (then SkyTerra) as part of the Harbinger transfer of control proceeding which led up to the FCC Order in March 2010. As part of these conditions, SkyTerra agreed not to lease spectrum or more than 25% of its network traffic to AT&T and Verizon, which met with a furious reaction from those two companies, who described this restriction as “manifestly unwise and potentially unlawful“. After AT&T and Verizon filed petitions for reconsideration, enquiries from Congress prompted the FCC Chairman to write a letter asserting that these were “voluntary commitments [Harbinger] made” (as opposed to something the FCC imposed). That was always a very suspicious assertion, given it is hard to see why Harbinger would have wanted to limit its ability to do a deal with AT&T or Verizon.

The FCC’s FOIA releases in fact confirm that Paul de Sa at the FCC appears to have initiated the discussion of conditions “on build out and wholesale agreements…to ensure the public interest benefits of the build out” in November 2009 and he apparently was responsible for drafting the written version of these conditions (in an internal FCC meeting) after meeting with Harbinger (again apparently with no ex parte filing) and persuading them to sign off in late January 2010. With this background now revealed, its hardly surprising that Sen. Grassley has a lot of questions he wants to ask, which presumably should relate not only to the January 2011 waiver, but also to the March 2010 transfer of control.

2 Comments »

  1. IIA Paper Shows FCC Inaction on IP-Transition Threatens Harm to Consumers, Competition, and the Economy | Communications Liberty and Innovation Project said,

    October 8, 2013 at 7:44 am

    [...] nor judicial review. Recent examples of inside deals at the FCC include bureau-level decisions waiving spectrum restrictions for LightSquared and extending its satellite launch milestones in exchange for its consent to limitations on its future business dealings, and the Wireless [...]

  2. IIA Paper Shows FCC Inaction on IP-Transition Threatens Harm to Consumers, Competition, and the Economy | Center for Boundless Innovation in Technology said,

    January 13, 2014 at 4:22 pm

    [...] nor judicial review. Recent examples of inside deals at the FCC include bureau-level decisions waiving spectrum restrictions for LightSquared and extending its satellite launch milestones in exchange for its consent to limitations on its future business dealings, and the Wireless [...]

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