LightSquared's Future? -- Reply Hazy, Try Again...

It's looking like LightSquared will be needing some special flexibility from the FCC in order to move ahead, and depending on the outcome of a rather expensive interference study, may have a tough time getting on its feet.  This is unfortunate news, as the company could develop into a significant player in the industry, offering additional competition for existing providers.

The company has a satellite in space, with reported plans to launch another -- however, the business model seems to be shifting.  The request to the FCC to allow them to build terrestrial infrastructure and deploy phones that don't have the ability to communicate with their satellite may be an effort to attract a business partner and some capital.  It's no secret that the funding source for the effort has suffered downturns, and the longer it takes LightSquared to deploy and service markets the more expensive the venture's going to get.

On the ground in Phoenix, the project is on indefinite hold, and other markets also seem to be in limbo.  Interference concerns from the NTIA and others, as well as other issues, could interfere with LightSquared's ability to meet the timeline the FCC has required for them to service a given number of customers.

We're hopeful LightSquared will find a way to persevere, and we're confident the additional infrastructure as well as competition will be healthy for the market -- the question is, will existing regulation and the market allow it to materialize...?  The magic 8 Ball says, "Reply Hazy, Try Again..."

RES