Sprint's on the Hook for $65 Million if Lightsquared Doesn't Pass FCC Muster

Due to continued interference with the GPS spectrum, Lightsquared's LTE network likely won't be approved by the FCC any time soon. That's bad news for Lightsquared but even worse for Sprint.

Last year, Lightsquared paid Sprint $65 million as part of a proposed 15-year infrastructure development and spectrum-sharing deal. As part of that agreement, Sprint is required to return the money if the LTE network doesn't receive FCC approval by mid-March. However, the FCC appears to have just dealt the network a deathblow.

According to FCC spokesman Tammy Sun today, "NTIA, the federal agency that coordinates spectrum uses for the military and other federal government entities, has now concluded that there is no practical way to mitigate potential interference at this time. Consequently, the Commission will not lift the prohibition on LightSquared."

So, unless Lightsquared can somehow convince the FCC to reverse its decision or prove that the Commission's GPS interference study is flawed within the next month, the proposed nationwide mobile broadband network is kaput and Sprint will be $65 million poorer. [FCC via WSJ via The Verge]