The music is about to stop, and LightSquared is far from an available chair. Barring another extension, when 2pm rolls around today the erstwhile 4G wholesale disruptor will be in violation of the terms of its debt. The word is that a deal between Harbinger and LightSquared’s lenders is nowhere close, and preparations are underway for a bankruptcy filing.
Following the FCC’s decision to deny the company a waiver to build its network in the face of vehement opposition from the powerful GPS industry, there really was no other likely way this could turn out. The last two months have been nothing more than the circling of the financial vultures.
Over at Gigaom, Kevin Fitchard gives a nice summary as to what may happen next. Dish Network very well may swoop in and try to pick off the spectrum. They have LTE plans of their own and S-band spectrum to pair with the L-band stuff LightSquared has – and more flexibility when it comes to interefering with GPS. It might be a way out for the remaining LightSquared employees too, if Dish should decide the quickest way to jumpstart its plans is to buy what remains of the LightSquared team as well.
Sooner or later, that spectrum will have to be made available for other uses and the GPS industry will have to compromise. LightSquared’s main problem was that it lacked sufficient time and had to hurry the process. When it comes to regulatory stuff there’s nothing more inherently dangerous than to depend on the timing of the arrival of consensus.
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