* FCC approves LightSquared waiver for terrestrial service
* Will make LightSquared network available to more phones
* Process set up to address interference problems
(Adds comments from LightSquared and NTIA)
By Jasmin Melvin
WASHINGTON, Jan 26 U.S. regulators cleared the way
for satellite broadband start-up LightSquared, owned by
billionaire investor Philip Falcone's Harbinger Capital Partners
fund, to lease its airwaves to traditional mobile phones.
LightSquared requested the waiver in November to modify
conditions around its current wireless spectrum licenses in order
to offer terrestrial wireless broadband services.
The Federal Communications Commission approved the waiver on
Wednesday, which drops a requirement that all mobile phones using
LightSquared airwaves have to support satellite calls, according
to the FCC's website.
"This is a promising opportunity to promote mobile broadband,"
a senior FCC official said, according to an FCC statement. "Having
an extra player in the mobile broadband field increases
competition and provides consumers with more choices."
The FCC's decision will allow the Virginia-based company to
lease its airwaves to traditional mobile phones instead of only to
pricier satellite phones.
"LightSquared's network will provide a robust, open-access
network that will permit reliable and affordable service to
customers across the country in every market segment," the company
said in a statement.
The waiver is also critical for Falcone's roughly $6.4 billion
Harbinger Capital Partners which has largely staked its future on
building a wireless network. The fund has invested roughly 40
percent of its assets in LightSquared.
The fund's flagship performance has sagged in recent months
and Falcone has had to lay off some investment staff as a large
chunk of the fund's capital has been locked up in LightSquared.
The company had promised to use satellites and an array of
land-based cell towers to bring broadband service to every corner
of the United States.
The agency last year approved an application from the wireless
startup to build a high-speed wireless network that would offer
both satellite and land-based service for wholesale clients.
But the National Telecommunications and Information
Administration objected earlier in the month to LightSquared's
request to alter the original plan so its airwaves could also
support terrestrial-only phones.
NTIA, an agency within the U.S. Commerce Department that
manages government use of airwaves, cautioned the FCC that
allowing such services could interfere with global satellite
systems for navigation, aeronautical emergency communications
systems and receivers used by federal agencies.
A fully terrestrial service would require more land-based
stations than a combined satellite and terrestrial system and
increase the likelihood of communications interference, according
to the Jan. 12 letter signed by NTIA Administrator Lawrence
The senior FCC official said all interference problems must be
addressed before LightSquared can offer commercial service under
"What we are doing is setting up a process for LightSquared
and the GPS community to work together to resolve the interference
issue on an expedited basis," the official said.
LightSquared said in a statement it would diligently "work
with all interested parties in an open and comprehensive process
to address those concerns."
NTIA's Strickling said on Wednesday he was pleased with the
FCC's measures to resolve interference concerns, and NTIA would
continue to consult.
Harbinger Capital Partners has invested billions to launch a
national broadband wireless network.
LightSquared aims to rent capacity on its network to service
providers looking to sell high-speed wireless services to
Companies such as T-Mobile USA, a Deutsche Telekom (DTEGn.DE)
unit, and MetroPCS Communications PCS.N have said they may be
interested in partnering with LightSquared if it gets its network
up and running.
(Reporting by Jasmin Melvin; Additional reporting by Sinead
Carew in New York; Editing by Phil Berlowitz)