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Weathering Political Criticism, LightSquared Takes on Detractors Weathering Political Criticism, LightSquared Takes on Detractors

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Technology / TECHNOLOGY

Weathering Political Criticism, LightSquared Takes on Detractors

LightSquared sent the satellite for its wholesale wireless network in 2010, but has had trouble getting federal approval for the project due to a dustup over GPS and other political woes. Now the start-up has decided to launch a political counteroffensive.(Courtesy of ILS)

photo of Josh Smith
October 26, 2011

Already mired in a complicated technological debate over how to prevent its network from interfering with GPS, the wireless start-up LightSquared has faced withering political criticism over the past few months. Now the company has a message for its detractors: Two can play that game.

LightSquared is struggling to launch a nationwide, wholesale wireless network based partially on satellites and had been focused on the technical aspects of its argument  -- much of it over whether the company’s planned network would interfere with existing GPS technology. But after a flurry of unflattering headlines alleging that the company won Federal Communications Commission approval for its plans through campaign contributions and backroom deals, LightSquared is now trying to shift the focus to its critics.

LightSquared has hired dozens of top lobbyists, including at least seven former elected officials -- including ex-House Democratic Leader Richard Gephardt of Missouri; former Republican Sen. Tim Hutchinson of Arkansas; and Democratic former Gov. Ed Rendell of Pennsylvania.


Most recently, LightSquared has taken aim at Bradford Parkinson, known as one of the founders of GPS and a member of the National Space-Based Positioning Navigation & Timing Advisory Board, which advises the government on GPS issues. Parkinson is also an investor and a member of the board of Trimble, a GPS manufacturer that has led the fight against LightSquared’s plans.

That, LightSquared officials contend, is a conflict of interest.

“It seems highly incongruous and even inappropriate to us that the government's top outside adviser on GPS matters would be simultaneously helping to oversee the same company that is leading the public-relations and lobbying campaign against LightSquared, and that has a financial interest in the outcome of that battle,” said LightSquared spokesman Terry Neal.

LightSquared is also pushing back at members of the GPS industry who have argued that LightSquared is trying to game the political system for financial gain.

On Wednesday, LightSquared released publicly available information that it had compiled showing top Trimble executives dumping millions of dollars in company shares the month after LightSquared received conditional FCC approval for parts of its plan in January.

A Trimble spokesman did not immediately respond to a request for comment.

President Obama’s past investment in a LightSquared predecessor has become fodder for Republicans in the media and on Capitol Hill. Rep. Michele Bachmann, R-Minn., who also happens to be running for president, has called the LightSquared approval process “crony capitalism at its worst.” Republicans also seized on reports that an Air Force general was asked to change his congressional testimony about the effects of LightSquared’s network.

GOP and good-government groups traced contributions from LightSquared officials to Democrats. Bachmann and other conservatives said that FCC Chairman Julius Genachowski’s work as a campaign-contribution bundler for Obama compromised his role in the process.

Rep. Tom Petri, R-Wis., and Sen. Chuck Grassley, R-Iowa, who have both received thousands of dollars from groups with GPS ties, have taken the FCC to task for its handling of the LightSquared process.

"In our decades of public service, we have never seen the entire federal government and so many private companies directed to expend such considerable financial resources and man hours to accommodate a single company's desires,” the pair wrote in a letter to Genachowski on Sept. 22.

And the group Coalition to Save Our GPS, which includes Trimble and tractor-maker John Deere, has argued that LightSquared “will truly say anything in its desperation to save its ill-conceived plan.”

“Massive PR campaigns and glossy ads can’t make false statements true.  At the end of the day, this is all about money for LightSquared,” Trimble Vice President Jim Kirkland said in a statement. “[I]t doesn’t want the American public and taxpayers to know that if LightSquared’s plans are allowed to go forward, it will receive a $10 billion windfall increase in the value of its spectrum, according to its own consultants’ estimates.” 

LightSquared officials have said they think the GPS companies are behind the unfavorable news stories and political criticism.  In the heat of the controversy last month, LightSquared’s chief investor, billionaire financier Philip Falcone, took to Fox News to argue that the process “shouldn’t be a political issue.” This new pushback may signal LightSquared’s recognition that maybe it shouldn’t be political, but it is.

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