LightSquared says it has a solution to the problem of interference with Global Positioning System (GPS) receivers that will allow LightSquared to proceed with its business plan. LightSquared says 99.5 percent Of U.S. GPS receivers will be interference-free, while there are technical solutions for the other 0.5 percent Of GPS receivers.

One of LightSquared’s 10-MHz blocks of frequencies poses interference to many GPS receivers, and happens to be the spectrum LightSquared originally hoped to use to launch it service initially.

LightSquared says it can use another 10-MHz block of the spectrum lower on the spectrum band and located further away from the GPS frequencies, greatly reducing the risk for interference. That move requires negotiations with Inmarsat, the satellite company that controls the alternative block of spectrum in the L Band, but LIghtSquared says it has such agreeement.

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See http://www.lightsquared.com/press-room/press-releases/.

LightSquared also says it will modify its Federal Communications Commission license to reduce the maximum authorized power of its base-station transmitters by over 50 percent. This move will provide additional protection to GPS receivers.

The bigger questions might be financial. It remains unclear whether LightSquared will be able to remedy its interference issues in the upper bands, at reasonable cost, to the satisfaction of GPS service firms.

But, near term, the changes might affect LightSquared’s efforts to continue raising investment capital to build the network. Analysts say LightSquared, which still needs billions of dollars more funding to build its network, may face more difficulty raising money in light of the interference problem with GPS services. See http://www.cnbc.com/id/43471183.

“It is very hard to see how you justify an equity value for this business (in line with) what Harbinger has invested,” unless it can show it will be able to use all the spectrum it owns within two or three years, Tim Farrar, an independent satellite industry analyst said.

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