Senator demands to know who will pay for LightSquared GPS retrofit

While LightSquared is printing up open letters to Americans in major newspapers across the country, a key U.S. Senator has sent a letter of his own—this one addressed to FCC Chairman Julius Genachowski. Senate Judiciary Committee ranking Republican Sen. Chuck Grassley, R-Iowa, asked some pretty probing questions about the interference problems LightSquared’s proposed LTE network would cause for GPS receivers.

Specifically Grassley wanted to know who would pay for the retrofit of millions of military, government and commercial receivers if LightSquared’s network was given the green light. Here’s an excerpt from the letter dated Sept. 29:

“I am sure you will agree with me that both public funds and public assets should not be used for private benefit. Though private industry is the engine that drives our economy and entrepreneurship is a necessary ingredient in our economic recovery, government should not favor selected private companies. This means that if a private company seeks to benefit at the expense of the federal government, that company should, at the very least, compensate the federal government for its expense.
“My concern regarding LightSquared’s application to create a terrestrial 4G network is that the Federal Communications Commission (FCC) appears not to have taken sufficient steps to safeguard the American taxpayer and appears to have let LightSquared off the hook regarding the multi-billion cost to retrofit GPS receivers to block out LightSquared’s terrestrial network.

“ … Despite the readily apparent concerns which were present throughout the waiver process, at no point has the FCC addressed who will pay to retrofit every single federal, state, and local government GPS receiver, which will require a filter as a result of interference caused by LightSquared’s terrestrial network.”

At issue is the out-of-band interference caused by LightSquared’s high-powered terrestrial network signals overwhelming low-power GPS receivers, rendering them useless or seriously inhibiting their primary function, gathering Global Positioning System location and timing data. LightSquared has changed up its LTE deployment proposals several times in an effort to eliminate or at least mitigate those interference problems, but commercial GPS device makers as well as government officials maintain those problems would persist even with a scaled back LTE network (CP: Sorting out the LightSquared interference mess).

LightSquared has claimed that it has done all it can to keep to get its signals well away from the GPS band and assigns blame to the GPS industry for any remaining interference problems, accusing them of designing receivers that purposely listen in on LightSquared’s spectrum (CP: LightSquared lashes back at GPS industry). LightSquared even accused GPS device makers of ignoring guidelines set by the Department of Defense that would have solved the problem (CP: LightSquared plays the patriot card).

But it is the Defense Department that Grassley cited as the primary source of his concerns. In the letter, Grassley drew from Air Force Space Command General William Shelton’s testimony before a House Armed Services subcommittee earlier this month: “We have not estimated cost however, I think it would be very safe to say that the cost would in the B’s–billions of dollars,” Shelton said. “We believe that the time would probably be a decade or more to accomplish all this. There are probably a million receivers out there in the military, maybe even more than that.”

Grassley acknowledged that LightSquared has disputed Shelton’s testimony, as well as the claims of the GPS industry, and has been working to develop filter technology that once fitted into current devices would bring interference down to acceptable levels. But even if LightSquared is correct that a filter solution exists, someone still has to pay for the retrofit, Grassley said. The Senator made it clear he doesn’t think the government should have to foot the bill. He asked Genachowski and the FCC three specific questions, to which he asked for a written response by Oct. 13:

· “Should the FCC find that LightSquared has fully satisfied all interference concerns, who will pay to retrofit all federal, state, and local government GPS receivers with filters?”
· “Should the FCC find that LightSquared has fully satisfied all interference concerns, who will pay to retrofit all privately-owned GPS receivers with filters?”
· “Has the FCC sought independent estimates from federal agencies and state and local governments on the cost of retrofitting their GPS devices? If not, why not?”

Meanwhile, LightSquared has been stepping up its public relations campaign, appealing directly to ordinary Americans about the virtues of its network (Unfiltered: LightSquared tidies up GPS mess; ready to be the network ‘all American deserve’). The direct appeal is strange considering that if it were to launch few people will ever encounter the name LightSquared. Its wholesale business model would make LightSquared the network behind the brand, while its customers like Best Buy would sell service to consumers and businesses under their own names (CP: LightSquared lands Best Buy; wholesale commitments rack up). But as LightSquared faces mounting political pressure in Washington, it’s telling the public that approval of its network plans would fuel the mobile broadband revolution, while its rejection would only hold it back.

This week it began running ads in U.S. newspapers across the country, the first of which appeared Thursday. The ads include text tailored to the residents of each state. Here’s an excerpt from the letter that ran in California newspapers:

“… a 2011 FCC report states that a third of California households lack any form of broadband. The current nationwide wireless providers have failed to innovate and in the process have failed to keep pace with consumer and technological demands.

“…The facts are clear. The need for additional wireless broadband is imminent. The desire to expand free-market competition and to provide consumers with broader access has been the hallmark of both Republican and Democrat policy makers for more than a decade. Regulators from both Democrat and Republican Administrations have conducted reviews of the LightSquared network—the most extensive in the history of the FCC—and both have reached the same conclusions: they support the LightSquared network.”