LightSquared triggers spectrum re-banding

Looking to keep its foot to the floor, LightSquared said it has delivered a notice to satellite communications provider Inmarsat plc (IMASF.PK) triggering “Phase 1” of their agreement that calls for Inmarsat to begin re-banding its L-Band spectrum covering North America.
The plan, which LightSquared said could take up to 18 months, also calls for Lightsquared to make payments totaling $337.5 million to Inmarsat over the duration of the transition. The plan was part of an agreement signed in late 2007 by Inmarsat and LightSquared’s predecessor companies SkyTerra Communications Inc. and Mobile Satellite Ventures L.P. Both companies were eventually acquired by Harbinger Capital Partners.
Once completed, the re-banding will provide LightSquared with spectrum it plans to use to begin building out a terrestrial/satellite hybrid network.
“Triggering this agreement will now give us the contiguous spectrum we need to support additional network capacity to meet the growing demand for wireless data,” said Sanjiv Ahuja, chairman and CEO of LightSquared.
The company last month announced a $7 billion agreement with Nokia Siemens Networks to begin building out the LTE-based terrestrial network that will include more than 40,000 base stations and cover 92% of the U.S. population by 2015. LightSquared said it plans to wholesale access to the network.
LightSquared added that it also has the right to initiate “Phase 2” of the agreement anytime through Jan. 1, 2013, which will provide it with additional spectrum at an annual cost of $115 million. If exercised Phase 2 is expected to take up to 30 months to complete.
Inmarsat recently unveiled its first mobile satellite handset to round out its portable device offerings.