Solidifying all the speculation, 4G satellite wannabe LightSquared inked a 15-year deal with Sprint Nextel that includes spectrum hosting and network services, 4G wholesaling and 3G roaming. However, the partnership won’t be real until the Federal Communications Commission (FCC) vets LightSquared’s plan to solve GPS interference issues involving terrestrial use of the L-band spectrum.
According to Sprint, this spectrum-hosting arrangement is part and parcel of its multi-year “Network Vision” plan. LightSquared will pay Sprint to deploy and operate a nationwide LTE network that hosts L-band spectrum licensed to or available to LightSquared. As a wholesale-only carrier with separate core network operations, LightSquared can sell its 4G broadband capacity produced through this spectrum hosting relationship to Sprint, other wireless carriers and retail partners.
Other terms of the deal:
>> For 11 years, LightSquared will pay Sprint approximately $9 billion in cash for spectrum hosting and network services as well as LTE and satellite purchase credits, currently valued at approximately $4.5 billion.
>>Sprint can purchase as much as 50 percent of LightSquared’s expected L-band 4G capacity. The wholesale purchase credits give Sprint cost-competitive access to 4G capacity by offsetting Sprint’s purchases of 4G capacity from LightSquared, should Sprint elect to incorporate the L-band LTE capability as part of its 4G offering.
LightSquared says this 4G partnership “is expected to lower network capital and operating expenses for LightSquared by more than $13 billion over the next eight years in comparison with the cost of a stand-alone network build.”
The satellite startup also has a 3G nationwide roaming agreement with Sprint, giving its wholesale customers combined 4G/3G data services as soon as the FCC gives its approval to LightSquared’s launching its first 4G markets in 2012.
(Editor’s note: For more on LightSquared’s current regulatory situation, read the July/August issue of Communications Technology magazine, now online at www.cable360.net/ct.)