Lightsquared - The Technologies, Issues, and Problems

You may have heard of the growing political scandal linked to the promotion of LightSquared, a start-up hoping to use a combination of terrestrial towers interconnected by satellites to create a new high-speed (4G) wireless network.
While the system may be conceptually interesting and viable, the history of LightSquared, the specifics of the proposed terrestrial-satellite system, and the process by which it gained initial approval and license are more problematic.  Most recently, claims of attempted White House interference and  influence of government and military figures testifying before Congress on the results of early testing of the LightSquared system, which showed a strong potential to interfere with military, government, and private GPS systems.
Lightsquared, or at least its precursor, was one of three companies given initial approval to test the viability of delivering broadband internet connectivity through a satellite-based system.  Apparently, it soon found that the costs of a satellite-only system did not generate the level of demand it felt it needed to be successful.  It asked the FCC to expand the satellite frequency grant to cover terrestrial uses as well.  Apparently, instead of going through the normal petition process, it approached the Chairman of the FCC's office for expedited approval.  The office opened a shortened petition process on the evening before Thanksgiving, and closed it before there was any formally published announcement of the petition (and allegedly, without even informing other FCC Commissioners of the action).  The petition was granted to Lightsquared (again, apparently without the knowledge or approval of other FCC Commissioners or the Office responsible for that aspect of broadcast usages.  Further, it's claimed that the other two satellite service firms petitioned for similar treatment, they were told no, that they had missed the petition window.  The extension of the bandwidth grant to terrestrial use boosted the asset value of LightSquared's satellite bandwidth by about $10 billion, which sent its stock price rising.  It's reported that a number of friends and political supporters of the FCC Chairman, including President Obama, bought stock in Lightsquared around that time.  The President has since sold his holdings, but a number of friends and supporters remain stockholders and investors, and LightSquared ownership and management continue to give heavily to various Democratic and Presidential campaigns.
While this may be somewhat sleazy, the real problem is what Lightsquared proposed to do with the terrestrial-use extension.  The bandwidth that Lightsquared and the other firms were assigned are near the frequencies used for GPS (global positioning systems).  As a satellite system, because the satellites would be in different positions, and the signals of relatively low power, there was little potential for interference between GPS and the proposed satellite-based broadband services.  What LightSquared now planned to do with its permission to use their frequencies for terrestrial services, however, was to build a nationwide system of 40,000 towers to serve as the primary wireless access point, and use the satellite system to connect the towers with Internet backbone access points.  The terrestrial system would need to operate at a much higher power level than the power levels of satellite-based systems (including GPS) at ground level.  Between the higher power and the closer proximity to ground or even air-based GPS receivers, there was, with the proposed terrestrial tower system, a significant potential for interference - that the LightSquared signals would drown out GPS signals.  Results from early tests of prototype systems showed that LightSquared signals did create interference with GPS signals, leaving "dead spots" miles in diameter near their terrestrial towers.
That's where politics arguably intrudes again.  When Congress asked the military and civilian officials charged with oversight of the GPS system to testify as to the impact of the proposed LightSquared, the officials were apparently approached by people in the White House to change their testimony, minimizing any concern about interference, and to specifically include a paragraph indicating that they felt any potential problem would likely be resolved within 90 days.  It's been charged that this was to expedite FCC action on final approval for the LightSquared system.  However, both officials not only declined to change their testimony and include the paragraph, but testified about the attempt to influence, that the concern about potential interference was real and significant, and could significantly disrupt both civilian and military GPS use.  They also characterized the idea that problems could be resolved so quickly, or without significant cost to GPS users, was, frankly, ridiculous.  Congress has now advised the FCC Chairman not to proceed with any further action on LightSquared until a number of issues (including potential securities fraud and influence-peddling charges) have been resolved.
Lightsquared has responded with a claim that it has a "simple filter" that will limit interference on "99.5%" of GPS receivers. aGoing on the offensive, it argued that it "can't believe that such a terrific national benefit as a new national wireless network" could be held up by a problem with a few hundred thousand unfixable GPS devices.  Their announcement also blames the GPS industry for using the frequencies they were assigned by the FCC, claiming the industry failed to install filters to correct for problems it didn't know about and weren't available, and suggesting that the commercial GPS industry unfairly benefits from the government's $18 billion GPS network.  Apparently, it's ok for LightSquared to benefit from a $10 billion subsidy it got from the FCC's extension of terrestrial rights (which kept it from having to bid for, and pay the government for, the terrestrial usage rights for the bandwidth it wants to use), but it's not reasonable that hundreds of millions of individuals can benefit from using a federally-provided service.  They also hope that no one correctly makes the connection that Lightsquared's solution would require replacing that "99.5%" of GPS devices with ones using their filter, and that the replacement costs, or the costs of finding ways to add the filter externally, would be borne by GPS users. 
But the response that's likely to be most problematic is from the FCC technical working groups that studied the proposed system and "fix" found conclusive evidence that "LightSquared's proposed operations defy the law of physics, and therefore simply will not work," that going ahead with the various shifting variations of LightSquared plans "would cause such widespread harmful interference that it would severely cripple GPS," and that the only viable solution was to move the wireless broadband use "out of the MSS band altogether" (The MSS band includes both GPS and LightSquared's current frequency assignments).
Physics and reason should, at a minimum, put a hold on approval for the proposed system.  You have the technical experts in the FCC, the military, and in the executive branch office responsible for maintaining the GPS system all testifying under oath that there are problems with the proposed LightSquared system - problems that are likely to create significant service disruptions in a widely-used public system, and that the disruptions could have serious consequences that could threaten public safety and military uses.
One the other hand, you  have a company in a press release claiming it has a miraculous quick fix that was rebuked by technical experts, would place the cost of the fix fully upon the users of GPS devices, and that anyway, it was all the commercial GPS industry's fault for operating in their assigned frequencies and not anticipating, years ago, the need to install "fixes" for a new proposed system - one that would be solely responsible for creating the problem, and whose technical details have only recently been made public.
It's pretty clear that LightSquared thinks we're all rubes - at least if it thought any of there arguments were reasonable or rational.  I guess the real question is whether whoever in the White House and the FCC Chairman's office is pushing this epitome of crony capitalism agrees, and continues to support this farce.

Sources: GPS industry rages: LightSquared 4G network would "defy" laws of physics, ars technica
myriad other sites