Sprint and LightSquared sign LTE network deal

in News, LightSquared, Sprint, 3G, 4G, LTE

Sprint Nextel and LightSquared have signed a 15-year agreement that includes spectrum hosting and network services, 4G wholesale, and 3G roaming. Under the agreement, LightSquared will pay Sprint to deploy and operate a nationwide LTE network that hosts L-Band spectrum licensed to or available to LightSquared. As a wholesale-only carrier with separate core network operations, LightSquared can sell its 4G broadband capacity produced through this spectrum hosting relationship to Sprint, other wireless carriers, and retail partners.

During an 11 year period, LightSquared will make payments to Sprint of approximately $9 billion in cash for spectrum hosting and network services as well as LTE and satellite purchase credits which are currently estimated to be valued at approximately $4.5 billion. The agreement also provides Sprint the opportunity to purchase up to 50 percent of LightSquared’s expected L-Band 4G capacity. The wholesale purchase credits will provide Sprint the option to obtain cost-competitive access to 4G capacity by offsetting Sprint’s purchases of 4G capacity from LightSquared, should Sprint elect to incorporate the L-Band LTE capability as part of its 4G offering.

LightSquared expects the deployment of the nationwide 4G-LTE network to be completed more than one year ahead of the Federal Communications Commission (FCC) mandate to cover 260 million Americans by 2015.

LightSquared has also entered into a 3G nationwide roaming agreement with Sprint. With access to Sprint’s 3G nationwide network, LightSquared’s wholesale customers will be able to offer combined 4G/3G data services as soon as LightSquared launches its first 4G markets in 2012.

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