[time-nuts] They're baaaack!

[Charles P. Steinmetz]

>Are LightSquared still trying to get some value from their contributions?

Of course they are.  Lightsquared ("LS") bought low-valued spectrum 
at fire-sale prices, speculating that with rule changes and waivers 
they could use it for a terrestrial broadband network, in which case 
its value would increase by a factor of 100, 1k, or 1M.  If there is 
any chance whatsoever to still reap that windfall, LS will press it.

The spectrum LS bought is allocated to the Mobile Satellite Service 
("MSS").  Until relatively recently, this spectrum could only be used 
for satellite networks.  Because mobile satellite service has never 
caught on due to the high cost of the space segment and some 
technical limitations of delivering good broadband performance by 
satellite, the value of MSS spectrum has been much lower than the 
Commercial Mobile Radio Service spectrum now used for mobile 
broadband services (pennies on the dollar, or less).

The FCC is convinced that the US will founder as a backwater and will 
be unable to climb out of the recession if it doesn't have more 
mobile broadband spectrum, and soon.  (I believe this is a faulty 
notion at best, trending toward absurd, and have articulated my 
reasons here a number of times, so I won't repeat them now.  Check 
the archives if you are interested.)  So, the FCC is racing to make 
more spectrum available for mobile broadband service.  It thought 
that the relative wasteland of underutilized MSS spectrum would be 
low-hanging fruit, so it indicated in its National Broadband Plan and 
some later decisions and Orders that terrestrial use of the spectrum 
should be considered.

Seeing the opportunity to buy cheap MSS spectrum (including buying 
some MSS companies out of bankruptcy) and convert it to a much, much 
more valuable use, thereby reaping a windfall, LS did just 
that.  However, as we have seen, the technical problems surrounding 
repurposing satellite spectrum have thrown a spanner in the works of 
the initial plan.  As I have commented here before, how the FCC and 
whoever did the LS due diligence all missed the obvious problems with 
putting powerful terrestrial transmitters adjacent to receivers 
listening to satellites is beyond me, particularly when the issue of 
SDARS (satellite radio) ancillary terrestrial transmitters 
interfering with mobile networks should have been fresh in everyone's minds.

To summarize -- LS bought cheap spectrum that nobody much wanted 
because of the difficulty of providing MSS services.  The spectrum is 
still worth about what LS paid for it, *as MSS spectrum.*  But LS 
apparently feels entitled to receive not just the value of the 
spectrum *as MSS spectrum,* but rather the value it would have *if it 
could be used for mobile broadband service.*  Put another way, they 
want their speculative gamble covered.  By whom?  Well, that would be 
us, the folks who are still in the middle of bailing out the 
speculators of the last decade.  LS now wants to swap its spectrum 
for government spectrum that would be useful for mobile broadband service.

Now, on the one hand, I think having available the "wholesale only" 
service LS says it wants to provide would be a Good Thing.  On the 
other hand, I do not think we, the people, should subsidize it.  LS 
took a gamble, and lost.  That should be the end of it.  But there 
any number of politicians who, like the FCC, are panicked that the US 
is "behind" in the mobile broadband race and think more mobile 
broadband will restart the economy (again, I say, Dream On).  So, LS 
has allies that want to cover its bet for their own reasons.

Only time will tell how it works out.  If you want to have input into 
the process, at this point lobbying your congressional delegation and 
the appropriate House and Senate committee members appears to be your best bet.

Best regards,

Charles