GOP lawmakers scrutinize LightSquared

An earlier version of this story failed to include comment from the National Telecommunications and Information Administration. NTIA’s remarks are incorporated in this version.

Republican lawmakers Thursday called for greater scrutiny of LightSquared, a satellite venture funded by billionaire Philip Falcone, and particularly whether the Obama administration helped secure approval for the company’s multibillion-dollar effort to build a wireless broadband network.

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GOP staffers of the House strategic forces subcommittee accused the White House of trying to influence the testimony of an Air Force general who was speaking about the project’s potential to interfere with the Global Positioning System, the satellite network relied on by the military and private industry. The staffers said Gen. William Shelton revealed in an earlier closed meeting that the White House pressured him to include language in his testimony Thursday supporting LightSquared’s venture.

The Obama administration has called for more mobile services to carry a flood of smartphones and other wireless devices expected to hit the nation’s limited cell-phone airwaves, and Falcone is a major Democratic donor.

The White House denied trying to influence Shelton’s testimony. Col. Kathleen Cook, a spokeswoman for Shelton, also denied there was any improper influence. She said the White House, the Office of Management and Budget and the Defense Department routinely review congressional testimony and can weigh in with their own ideas to ensure consistency in policy across agencies.

And, even so, “I can assure you Gen. Shelton’s testimony was his own, supported by and focused purely on documented tested results,” she said.

But the episode, first reported by The Daily Beast, created new headaches for troubled Reston-based LightSquared. Lawmakers were further agitated when Federal Communications Commission Chairman Julius Genachowski decided not to appear at Thursday’s subcommittee hearing. The FCC has been accused of rushing to give a provisional green-light to LightSquared.

The company defended its business and interaction with federal officials.

“Any suggestion that LightSquared has run roughshod over the regulatory process is contradicted by the reality of eight long years spent gaining approvals,” said chief executive Sanjiv Ahuja in a statement. He said the company is poised to create as many as 15,000 new jobs and will put $8 billion in investments into the economy.

“We understand that some in the telecom sector fear the challenges for their business model that LightSquared presents. It’s also ludicrous to suggest LightSquared’s success depends on political connections. This is a private company that has never taken one dollar in taxpayer money,” Ahuja said.

In the hearing, Rep. Michael R. Turner (R-Ohio), chairman of the subcommittee, said he would call for the House Oversight Committee to investigate whether LightSquared received special favors from the White House or FCC to create its network.

Rep. Austin Scott (R-Ga.) also questioned the National Telecommunications and Information Administration. He said that the agency, the technology policy arm for the White House, appeared to have urged the FCC’s January approval of the network, which would allow LightSquared to use satellites to create a wireless broadband network. Current wireless broadband systems are based on Earth-bound broadcast networks.

“I’ve been in politics for 14 years. I have never seen an agency advocate so strongly for something like this, unless there was pressure from above or a relationship that was not being disclosed,” Scott said.

In a statement, NTIA said: “As we’ve consistently stated since January, LightSquared should not begin offering commercial service until harmful interference concerns are resolved. Our job is to serve as an honest broker of the facts and data and we owe it to all parties to resolve these issues promptly and conclusively.”

Some criticized the GOP lawmakers for attempting to “politicize” LightSquared’s GPS problem.

Loretta Sanchez (D-Calif.), ranking member of the subcommittee, said she wasn’t troubled by Genachowski’s decision not to come.

“He sent a letter and everyone can see what the chairman of the FCC has to say about this issue at this point,” Sanchez said. “So we don’t have to poke fingers or try to figure out people’s motives or intentions.”

At issue is a waiver granted by the FCC in January that allows LightSquared to operate mass-market cellphones on its network. Competitors, the GPS industry and some federal agencies warned that LightSquared’s devices would interfere with signals for GPS receivers used by everyone from the military to soccer moms for navigation.

“We were caught off guard,” Shelton said in the hearing. “The network was originally space-based . . . this is a very significant shift.”

The FCC has downplayed the significance of the waiver, vowing that it won’t allow LightSquared to operate its network until it has resolved interference problems.

LightSquared, which said it wasn’t invited to attend the hearing, has since revised its business plans and said it will operate on a different part of the satellite spectrum so it won't crowd out nearby GPS receivers.

But the new plan, Shelton said, will require billions of dollars in fresh testing of antennas and receivers that could take as long as a decade.

Sen. Charles E. Grassley (R-Iowa) on Thursday said he was troubled by allegations that the White House had tried to influence Shelton’s testimony. “The White House shouldn’t be telling a four-star general what he can and can’t say before a congressional committee on a matter of national security, especially to help the profitability of a private company,” Grassley said.

The senator also has criticized the FCC for what he sees as fast-tracking LightSquared’s regulatory process without settling concerns about interference with the GPS system. He said the FCC has refused to hand over documents and communications related to the company.

The FCC , however, said Grassley’s Judiciary Committee doesn’t oversee the agency and that it isn’t proper congressional protocol to comply with such requests.

The strategic forces subcommittee wanted to explore similar issues Thursday, and Turner had asked the chairman of the FCC to appear and address the concerns.

“I consider the chairman’s failure to show up today to be an affront to the House Armed Services Committee,” Turner said at the hearing.

The FCC disagreed. “The chairman never refused to testify, nor did his staff make any such suggestions,” said Tammy Sun, an FCC spokeswoman, in an e-mail. “To the contrary, the committee explicitly told FCC staff that they would accept a designee. We are pleased that our top technical expert was able to respond to questions today.”

 
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