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LightSquared tries to keep its 4G LTE dream alive

The startup that won't give up recently filed a new proposal to the FCC to revive its plan for building a nationwide 4G LTE network to compete with AT&T and Verizon Wireless.

The hedge-fund backed LightSquared isn't giving up on its plan to build a nationwide 4G wireless network. But the path forward is likely to be a long one.

Last week, LightSquared, which was backed by billionaire Philip Falcone and his hedge fund Harbinger Capital, filed proposals with the Federal Communications Commission that would help it satisfy interference concerns and allow the company to build its nationwide 4G LTE wholesale network.

Specifically, LightSquared has promised to permanently vacate the upper 10MHz of its radio spectrum. And it said it wouldn't use the lower 10MHz of spectrum until the FCC revises rules for operating in that band.

LightSquared has also proposed using 5MHz of spectrum that's currently used by the federal government, as a way of replacing some of the upper 10MHz it plans not to use at all.

LightSquared seemed doomed in February when the FCC said it would pull the company's conditional spectrum waiver. The FCC had granted a conditional waiver in 2010 so LightSquared could use satellite spectrum that sat next to GPS spectrum, on the condition that the use of this spectrum didn't interfere with GPS communications. The GPS community claimed there was significant interference that couldn't be avoided.

LightSquared offered to not use the upper 10MHz of spectrum that caused the most interference with GPS devices. But that didn't satisfy GPS device makers. After the FCC dropped support, the company's plans for building a nationwide wireless broadband network that would allow smaller carriers access to 4G LTE services at wholesale prices seemed destined for oblivion. The company lost its high-profile CEO, Sanjiv Ahuja. Then in May it filed for bankruptcy protection.

Still, LightSquared vowed to keep fighting. As part of its new proposal, it has proposed sharing spectrum with federal government agencies as a way to make up for the 10MHz of wireless spectrum it will give up permanently because of the GPS interference issues.

LightSquared proposes using 5MHz of spectrum that sits right next to the spectrum it already has approval to use, to create a contiguous 10MHz of spectrum for its service. LightSquared is already authorized to use spectrum in the 1,670-to-1,675MHz block. And it wants to share spectrum in the 1,675-to-1,680MHz block with government agencies using the same spectrum.

Sharing wireless spectrum with the federal government is not a new idea. The FCC is already working with the government to share airwaves with commercial entities in the 1,755-to-1,850MHz block. But it's unclear if the government agencies already using this 5MHz sliver of spectrum would be willing to share it. Chances are it's a long shot.

Wireless researcher Peter Rysavy told the Web site Ars Technica that even if you were able to get the technical aspects of sharing wireless spectrum worked out, "the politics of getting spectrum swapped could also be very challenging."

Indeed, the whole process of getting LightSquared off the ground has already been highly politicized. While Democrats have mostly supported LightSquared, Republicans seem split. Some congressional Republicans in support of the GPS industry blasted the Obama Administration for being too cozy with the company. But now it looks like some Republicans are criticizing the FCC for not doing enough to ensure LightSquared's success, according to the political Web site The Hill.

Last month, Republicans on the House Energy and Commerce Committee argued that the interference issues were the GPS industry's fault because their equipment is too sensitive and can receive signals transmitted in adjacent bands. And they wanted to know what the FCC was doing to ensure LightSquared's network is built so that there is another nationwide LTE player to compete against AT&T and Verizon Wireless.

For now it looks like the fate of LightSquared is back in the hands of the FCC, which will open the process for evaluating the new proposals to the public. FCC Chief of Engineering and Technology Julius Knapp told Ars Technica that it was too early to endorse any proposal put forth on LightSquared.

But one thing is certain, it looks like this process will continue to be dragged out a bit longer.