LightSquared said in its bankruptcy filing Monday, it will continue to try to win over the Federal Communications Commission to get its satellite venture up and running — a process that can take up to two years.
The filing also provided a rare glimpse behind the curtain of the private Reston, Va.-based company’s operations and the broad assortment of creditors and other financial backers tied to the satellite venture.
In its Chapter 11 filing, the satellite venture revealed a wide assortment of unsecured creditors of the firm including Boeing, which is owed $7 million and Alcatel Lucent, which is owed $7 million. Burson-Marsteller is still owed $264,000 and Level 3, $169,000.
The firm’s ambitious plan was to take on AT&T and Verizon Wireless — which are already well into their deployment of 4G LTE services. But for now, LightSquared said it will continue to run its smaller business as a wholesale provider of spectrum and satellite services. It has about $30 million in revenue in that business and said it has about 300,000 customers.
It’s partners include TriState Motor Transit Co, which uses LightSquared’s satellite system to track the delivery of valuable and dangerous cargo such as nuclear fuel and munitions between U.S. coasts.
Analysts, however, predict it will be extremely difficult for LightSquared to gain FCC approval.
“So long as there is a GPS interference issue with LightSquared L-band frequencies, the value of the company’s spectrum asset will likely remain diminished,” said Jeff Silva, analyst at Medley Global Advisors research.