Feeds

Sprint to hit the eject button in LightSquared deal today

Light at the end of the tunnel winks out

Internet Security Threat Report 2014

The Wall Street Journal reckons Sprint is going to pull out of its deal with LightSquared later today, leaving the box-of-frogs mobile broadband biz with nothing but $65m and a top-flight legal team.

The news comes as no surprise, even though it has not yet been confirmed by either party, only by the newspaper's contacts at Sprint. The infrastructure-sharing deal was always dependent on LightSquared getting FCC approval, something it has comprehensively failed to do, despite Sprint granting it two deadline extensions. This time around it seems that Sprint's patience has run out.

The previous extensions, granted late last year and early 2012, were both justified because the FCC was still dithering about whether it would permit LightSquared to deploy an LTE network in a frequency band where it could interfere with some high-precision GPS equipment. The dithering stopped last month when the FCC said "no" and while LightSquared is still planning to challenge that decision, the time is right for Sprint to get out.

LightSquared had given $65m to Sprint to seal the deal, money which Sprint will have to return now it wants out – but that's pocket change when one is taking about satellite launches and national networks.

At an investors' call just before the last extension, LightSquared was bullish about being able to build a network without Sprint, claiming that the use of Sprint sites would make life easier but wasn't necessary to balance the books.

It's hard to see how that can be true: using Sprint's infrastructure LightSquared put the cost of the network at $9bn, which is still $2bn more than it originally estimated and less than half the $25bn figure proposed by some industry analysts. It's worth noting that LightSquared never had the $9bn, which was to be paid over the next 11 years.

The winner here is ClearWire, pioneers of the WiMAX standard which proved a duff bet. ClearWire is busy deploying LTE these days, and has been mopping up LightSquared customers as they jump ship, so we'd expect to see a triumphant press release from them pretty soon if Sprint is hitting the eject button.

The Wall Street Journal points out that today is also the last day for LightSquared to raise objections to the FCC process, and reckons the company has 150 pages of said objections to be filed. Once the FCC has digested those LightSquared will, no doubt, be chucking its new litigation team into the mix while piling on the political pressure in the hope that the US Army will lend it some military spectrum - which is probably LightSquared's last best hope to challenge the mobile industry. ®

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Same old iPad? NO. The new 'soft SIMs' are BIG NEWS
AppleSIM 'ware to allow quick switch of carriers
Arab States make play for greater government control of the internet
Nerds told to get lost in last-minute power grab bid at UN meeting
Brits: Google, can you scrape 60k pages from web, pleeease
Hey, c'mon Choc Factory, it's our 'right to be forgotten'
Of COURSE Stephen Elop's to blame for Nokia woes, says author
'Google did have some unique propositions for Nokia'
It's even GRIMMER up North after MEGA SKY BROADBAND OUTAGE
By 'eck! Eccles cake production thrown into jeopardy
Mobile coverage on trains really is pants
You thought it was just *insert your provider here*, but now we have numbers
Don't mess with Texas ('cos it's getting Google Fiber and you're not)
A bit late, but company says 1Gbps Austin network almost ready to compete with AT&T
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.