Why You Should Regret LightSquared's Setbacks

from the competition-is-good dept

LightSquared is a new wireless carrier that has been trying to launch a wholesale 4G network across the USA. Funded by private equity firm Harbinger Capital, it sought to re-purpose satellite communication frequencies to build a nationwide cellular-satellite hybrid network, and then re-sell the network capacity to other brands. In January 2011, the FCC, eager to foster new competitors in the mobile space, gave LightSquared the green light to launch using their spectrum with one provision - that their network equipment NOT interfere with GPS signals and devices. Well, over a year has come and gone, and despite incredible effort and wrangling, the independent testing keeps indicating that LightSquared's terrestrial towers are not compatible with GPS device use. As such, the FCC has basically rescinded LightSquared's request to launch service on their 1.5GHz L-Band spectrum.

Note that, while LightSquared DID knock out GPS devices, it was not LightSquared that transmitted on the GPS frequencies, but rather the GPS devices that sloppily "listen" to the adjacent LightSquared frequencies. The GPS chipsets were generally cheaply made with inadequate filtering. That said, who is at fault is irrelevant: it remains LightSquared's problem to solve if they want to launch their network. A long history of spectrum policy states that new entrants must not mess up the existing radio devices.

What we've lost here is the chance to have a truly innovative wireless carrier which would have stimulated competition, energized the vendor community, and provided a white-label network for MVNOs. LightSquared had, in fact, signed up dozens of partners who would offer LTE wireless services as cellular companies, CE makers, and store brands like Best Buy, for example, who could sell connectivity in a bundle with laptops. Maisie Ramsay over at Wireless Week explains how a vast community of over 30 technology vendors have also lost a valuable path to market.

What strikes me, as someone who works with wireless carriers (LightSquared included), is that we may lose one of the scrappiest players out there. And markets thrive when a scrappy player stirs up the pot. Hutchison Whampoa stirred up the UK markets when it launched 3G in 2003, Free is currently doing the same in France. In the USA, we have regional players like Metro PCS, but nothing at the national level. My role at the Telecom Council of Silicon Valley is right where innovators meet with the telcos, and it was gratifying to see the tornado of new ideas, vendors, and possibilities that came about with a new network. Without legacy systems nor legacy thinking, lots of great ideas are free to emerge.

For now, with LightSquared's options dwindling, we may have to have to look elsewhere for new competition and open creativity. The WiFi space is fairly promising, as the spread of hotspots continues to soar, and new versions (802.11ac) promise greater range and throughput. Chipsets are cheap, and billions of WiFi devices have been produced. Republic Wireless exemplifies the possibilities of leveraging WiFi in mobile phones to the limit. Lots of people are hoping that the "white spaces" frequencies in between TV channels will be offered up to a WiFi variant, which will mean low-frequency spectrum that penetrates walls and buildings much better than today's WiFi. I like what the US carriers have done with the (globally) early launch of LTE, but there's no doubt that with increased competition we'd have a more dynamic market.

Filed Under: competition, gps, interference, spectrum, wifi, wireless
Companies: lightsquared


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  1. icon
    Chris-Mouse (profile), 21 Feb 2012 @ 5:57am

    First off, I have to say kudos to the FCC for giving LightSquared the chance to try. The fact that the condition was put on the waiver in the first place is a good indication that the FCC didn't think it was possible to avoid interfering, but LS got the opportunity to prove the FCC engineers wrong. The fact that the technology failed to work as planned does not mean LS cannot build their network. They just have to find some other spectrum in which to do it.

    Kudos also to the FCC for not allowing that idea to trample all over an existing highly innovative industry. A two inch square module that costs under $50 can provide both location information to within a couple of metres, and a time stamp signal with atomic clock accuracy. What's more, this is available everywhere on the planet with a view of the sky, even when mobile. You've almost certainly seen the explosion of in-car navigation systems over the last few years, but how about some of the hidden uses? There's a huge explosion in infrastructure that makes use of the location information of the GPS units, or the time information. In many cases it's cheaper and easier to hang a GPS unit on a system than it is to add in a real time clock or a connection to a time server.

    Overall, which is more beneficial to society, the innovation in the GPS industry, or the increase in innovation in the communications industry? That I can't say, but right now, I'm leaning towards the GPS industry. Who knows, maybe in another few years someone else will come up with a technology that will let the GPS and a terrestrial communications network coexist on adjacent frequency bands.

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