CTIA 2011: LightSquared Leaps Into Best Buy Deal
The news The CEO used the opening keynote on the second day of CTIA in Florida to put down a hard target for the new operator to meet. LightSquared is expected to start initial Long Term Evolution (LTE) services in some Midwest markets in the U.S. in the third quarter of this year. Ahuja says that this will expand to an ambitious 100 million people covered by the end of 2012.
Massive retailer Best Buy is one of the first big names to sign on to use the service. Ahuja said the company has agreed a deal to become a mobile virtual network operator (MVNO) on the network with an initial trial of the branded service expected in the first quarter of 2012. (See CTIA 2011: Merger Mania Obscures Hard News and LightSquared, Open Range Partner.)
An MVNO in Ahuja's terms likely means that the retailer will offer own-brand 4G service and devices with LightSquared running the network in the background.
What devices might Best Buy offer? We don't know yet. Ahuja, however, did say that LightSquared is working on "modems, routers and handsets" to run on its LTE network.
LightSquared also inked an LTE roaming deal with Leap Wireless International Inc. (Nasdaq: LEAP) on Tuesday. Leap's low-cost unit, Cricket Communications Inc. , however, still has to build out a 4G network to roam with the LightSquared offering in the first place.
Learning lessons from Clearwire Ahuja didn't mention Clearwire LLC (Nasdaq: CLWR) once during his 30-minute presentation. It was clear from some of his comments, however, that Ahuja is looking at Clearwire's problems with wholesale partner Sprint Corp. (NYSE: S) and others as ways not to run a business.
"We will never compete with our customers for end users," he promised from the stage.
Nonetheless, there are still some similarities between LightSquared and Clearwire, whether Ahuja wants to acknowledge it or not. In particular, Clearwire also put up a specific total to grow its greenfield WiMax "4G" network to cover 100 million users over the course of a year or so.
What is LightSquared? It is evident that LightSquared is shaping up to be one of the hot companies to follow in 2011. In essence, what LightSquared has is 59MHz of spectrum to build out an LTE network in the U.S. Any gaps in its coverage map will be filled in with its satellite services. This means that devices will need to support both terrestrial LTE connections and wireless from space on the L-band. This makes LightSquared unique amongst its peers but also presents one of the biggest challenges for the operators and the device vendors it is working with, such as Nokia Corp. (NYSE: NOK). (See LightSquared Tees Up $586M Loan Deal .)
The much more powerful signals generated by a terrestrial L-band network are already worrying global positioning satellite (GPS) vendors, which operate in the adjacent band. The GPS jockeys are concerned about interference from the new entrant. (See FCC Lets LightSquared Pass 'Go'.)
The Federal Communications Commission (FCC) has granted LightSquared a waiver on the interference issue but says that operator has to work with GPS providers over the next few months to understand if this is actually a problem and, if so, how much of a problem. (See LightSquared Gets Satellite-Ready and Which Carriers Is LightSquared Working With?)
— Dan Jones, Site Editor, Light Reading Mobile
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