By Brendan Sasso - 12/15/11 03:09 PM EST
LightSquared has invested billions of dollars in plans to launch a nationwide wholesale wireless broadband service, but it has come under fire since testing earlier this year revealed its network could cause problems for GPS devices.
The company has since adjusted its plans, including agreeing to operate its cell towers on only the lower half of its wireless frequencies. The company was hopeful the latest round of testing would show the interference problems had been largely resolved.
"We are pleased that the statement issued by the National Space-Based [Positioning, Navigation and Timing] Executive Committee, chaired by the Department of Defense and the Department of Transportation, validates LightSquared's compatibility with the nation's 300 million cellular phones," LightSquared CEO Sanjiv Ahuja said in a statement. "While we are eager to continue to work with the [Federal Aviation Administration] on addressing the one remaining issue regarding terrain avoidance systems, we profoundly disagree with the conclusions drawn with respect to general navigation devices."
LightSquared argues that the GPS industry is responsible for the interference issues.
They say the problem is that the GPS receivers are poorly designed and receive signals from airwave frequencies that belong to LightSquared. The GPS industry argues LightSquared is trying to operate powerful cell towers on frequencies that should only be used by satellites.
"LightSquared has had the legal and regulatory right to use its spectrum for eight years and two administrations," Ahuja said. "The testing further confirmed that the interference issues are not caused by LightSquared's spectrum, but by GPS devices looking into spectrum that is licensed to LightSquared. We have taken extraordinary measures — and at extraordinary expense — to solve a problem that is not of our making."
LightSquared has became embroiled in political controversy in recent months, with Republicans questioning whether the company benefited from ties to the White House and the Democratic Party. Rep. Michael Turner (R-Ohio) called for an investigation after the White House reportedly asked an Air Force general to change his congressional testimony to make it more supportive of LightSquared.
In September, Rep. Michele Bachmann (R-Minn.) accused President Obama of "crony capitalism" for allegedly giving favor to his political supporters, pointing to LightSquared's primary investor, Philip Falcone.
Falcone, who has donated thousands of dollars to both Democrats and Republicans in recent years, says he is a registered Republican and has denied any attempts to influence the process through political connections.
Sen. Chuck Grassley (R-Iowa) has demanded that the FCC release documents related to its review of LightSquared, and has pledged to block President Obama's two nominees to fill FCC vacancies until the agency releases the records.
White House and FCC officials say the wireless company has not received any special treatment, and the FCC emphasizes that the firm will only receive authorization to launch its network if it can demonstrate it does not harm GPS.
"We continue to believe that LightSquared and GPS can coexist," Ahuja said. "And we will continue to work with the federal government on a solution that will allow us to begin investing $14 billion in private money into the infrastructure of America to create jobs, competition and increased access to technology."