The twisted saga of LightSquared continues, with the mobile broadband operator – once tipped to be a significant disruptor of the US telcos’ cosy world – relaunching itself under a new name, Ligado Networks. Much has changed since LightSquared was forced to file for bankruptcy protection in 2012, and even more since 2010, when it originally set out its ambitious vision for a wholesale-only LTE network in L-band spectrum previously allocated to mobile satellite services (MSS). Now the cablecos look like the biggest threat to the wireless status quo, Dish is lurking with similar former satellite spectrum, and the industry is moving towards multiplay services, software defined networking and 5G.
Ligado will need a lot more than a new name to adapt its business model to all that change. It has achieved a lot in the past year – exiting Chapter XI and coming to a settlement with the GPS players who were its nemesis back in 2012. But now it has the look of Rip van Winkle awaking from his 20-year sleep to find he has slept through the American Revolution and has only a rusty gun at his side to arm him for the new world.
Indeed, Ligado’s CEO Doug Smith was open about the uncertainties ahead. The company is no longer necessarily wedded to the wholesale model, and is considering different options for bringing its new brand to market (which could, presumably, involve selling itself for its spectrum assets, though Smith categorically denies that is the plan).
“In terms of where the opportunity lies, there’s a lot of opportunity in different segments. I’m not prepared to tell you which one or which few we will go after specifically,” Smith told FierceWireless. “The 2010 and 2011 business model has changed.”
Ligado (which means ‘closedly tied together’ in Spanish) emerged from Chapter XI last March under the ownership of several investment groups, having won approval for its restructuring plan. Its owners are now Fortress Investment and Centerbridge Partners (34.3% between them), JPMorgan, and LightSquared’s original backer, Philip Falcone’s Harbinger Capital (44.45%).
It went on to sign agreements and settle litigation with the three GPS manufacturers (Deere, Garmin and Trimble) which had made its original launch impossible with claims that high power LTE signals would interfere with their transmissions in neighboring spectrum. The deals see Ligado committing to reducing out-of-band emissions from its planned LTE services, and avoiding spectrum adjacent to the GPS airwaves.
Not that Ligado has removed all the obstacles to a network launch (or spectrum sale). It still faces opposition from a coalition of aviation companies, also concerned about interference with GPS, and that will surely have to be settled before the FCC grants full approval for the spectrum to be used for commercial services. And even if that is forthcoming, there will be the time and cost to build a national network at a late stage in the market.
In contrast to 2010, when Verizon was just poised to launch the first LTE networks in the US, the market is now crowded with 4G. Verizon and AT&T have achieved very wide coverage and are moving on to densification and LTE-Advanced, with pre-5G trials expected within 1-2 years. They have also invested significant engineering effort in companion technologies to broaden the business case, including IMS/VoLTE, LTE Broadcast and machine-to-machine systems. T-Mobile is catching up rapidly and while Sprint – which was to have hosted LightSquared’s network on its Network Vision infrastructure – is further behind, it has plentiful spectrum and the potential to be a major platform for wholesale and MVNO business.
Of course, there are new wireless business opportunities emerging too, especially in the IoT, which may lend themselves to a greenfield network provider; and Ligado may be able to take advantage of new deployment approaches, such as virtualization, to reduce its costs and timescales. In a statement, Smith hinted strongly at an IoT direction, saying: “When we look at the Internet of Things, it’s not just things; the real keys to success are the connections between those things as well as the quality of that connectivity.”
That, in his view, will depend on exactly the kind of spectrum Ligado owns (its L-band frequencies are in 1525 MHz to 1559 MHz and 1627 MHz to 1680 MHz). He went on: “In order to accelerate delivery of innovative services in such verticals as healthcare, automotive, industrial, shipping, home and municipal sectors and to more broadly fulfill the promise of next generation mobile networks, more mid-band spectrum is needed. Mid-band spectrum is part of the solution to deliver ultra-reliable, highly secure and capacity-rich connectivity.”
Nonetheless, the challenge is a daunting one, even assuming the final issues around GPS coexistence can be laid to rest in short order.
On that front, Ligado executives including board director and former FCC chair Reed Hundt, met FCC officials this week to discuss the latest round of tests, designed to prove that the LTE network would not damage GPS. “It is clear that GPS and wireless broadband operations can coexist on adjacent channels,” the company said in an FCC filing. “Accordingly, the Commission should commence the process of providing this clarity to the entire industry by issuing a public notice on the issues and proposals raised in the License Modification Applications so that all interested parties may have the opportunity to comment on the proposed operational limits and New LightSquared’s plans for terrestrial deployment.”
The company still has some of its crusading zeal to open up the US mobile broadband market. Its filing continues: “If adopted, the licence modifications New LightSquared has proposed would not only open up new broadband spectrum in the US but also would promote American leadership in setting global standards, in turn creating greenfield spectrum for 5G build-out.”