March 18, 2012 by staff
Sprint Lightsquared, Sprint Nextel has terminated its 15-year spectrum-hosting agreement with LightSquared, eliminating the would-be wholesale mobile operator’s main carrier partnership even as the U.S. Federal Communications Commission seeks to shut down its network plans.
The deal, which the companies announced last July, called for Sprint to host LightSquared’s controversial 1.6GHz spectrum on its Network Vision infrastructure, in effect letting LightSquared piggyback on Sprint’s network and save itself US$13 billion over eight years. For this, LightSquared was to pay Sprint $9 billion in cash and grant it $4.5 billion worth of credits to use LightSquared’s spectrum for its own services.
Sprint extended the partnership twice from its original termination date at the end of last year, and the deal expired on Thursday. In a statement on Friday, the fourth-largest U.S. mobile carrier cited the unresolved GPS (Global Positioning System) interference issues that have prevented LightSquared from receiving FCC approval for its LTE network. On February 14, the FCC proposed steps that would shut down LightSquared’s hybrid satellite-LTE network plan.
“We remain open to considering future spectrum hosting agreements with LightSquared, should they resolve these interference issues, as well as other interested spectrum holders,” Sprint said. Sprint has returned $65 million in prepayments that LightSquared made to cover costs that Sprint never incurred. The companies had halted deployment design and implementation on the project late last year.
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