The hits keep coming for wholesale wireless network startup LightSquared, which just lost big client Leap Wireless due to uncertainty about the future of its high-speed LTE network.
Back in February, the Federal Communications Commission (FCC) rejected LightSquared’s plans to launch its LTE network due to concerns that it would interfere with both commercial and military GPS technology. Because of this development, Leap Wireless has decided to buy future LTE connectivity for its Cricket prepaid service from Clearwire, another troubled wireless company (of which Sprint is the largest stakeholder). Earlier this year, LightSquared client FreedomPop also decided to go with Clearwire. The real nail in the coffin for LightSquared will be if the $9 billion 15-year agreement with Sprint-Nextel to build and host its LTE network falls through.
The have been some rumors that the startup will propose swapping its licensed portion of the wireless spectrum with the U.S. Department of Defense. And considering how hard LightSquared has fought to launch its LTE network in its current form, such a move would be more of a headache. For now, the company is committed to fighting back on the FCC’s original decision by hiring a handful of high-profile legal representatives, such as former President George W. Bush’s lawyer from the 2000 presidential election Bush v. Gore case, Ted Olsen, and (Supreme Court Justice Antonin Scalia’s son) Eugene Scalia. Both men are partners are partners at Gibson, Dunn & Crutcher.
“Their (FCC’s) decision to not allow us to go forward isn’t supported by the law or technical policy. We are confident about that and we are eager to prove our case,” LightSquared EVP of Regulatory Affairs Jeff Carlisle told Bloomberg. He also noted that hiring the law firm doesn’t necessarily rule out the possibility that Lightsquared will pursue other actions to preserve its initial business plans.
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