Just when it seemed the LightSquared-GPS contest had run its course, a pair of latecomers–Senators John Kerry (D-Mass.) and Lindsay Graham (R-S.C.)–wrote to FCC chairman Julius Genachowski proposing that the agency should now find a vacant block of radio spectrum in which LightSquared could launch another attempt at its nationwide Internet plan. Perhaps unaware that broadcast radio frequencies cost billions to acquire these days, neither senator suggested where the new spectrum money would come from, particularly as LightSquared now appears to be skating slowly toward the thin ice of bankruptcy.

The telecom trade press was notably unenthusiastic about the senators’ proposal, but since experience has shown that anything is possible with LightSquared, they simply reported the facts without comment. But industry websites were more outspoken, with one describing the senators’ proposal as “the latest, and quite lunatic, move in the never-ending LightSquared saga.” In any event, the senators’ appeal to the FCC to help LightSquared looked like a non-starter, since the company in March had already hired two of Washington’s top legal guns as a preliminary to suing the FCC for its negligent and misleading handling of LightSquared’s license application.

Legislators Prepare for LightSquared Bankruptcy

At the same time, Senator Charles Grassley (R-Iowa) and Representative Michael Turner (R-Ohio) were pushing the Administration to recover, before any LightSquared bankruptcy distribution, the several millions in government costs involved in the extensive testing of GPS receivers against the LightSquared signals.

A separate source told AIN that it appeared likely a bankruptcy process could get under way in late April, and that could extend beyond the federal election into the new year, where the outcome would determine whether LightSquared founder Philip Falcone or his nemesis, corporate raider Carl Icahn, would emerge as the winner. But the winner of what is unclear. A Republican victory would likely offer little help for a LightSquared rescue, and Democrats would conceivably regard the company as an organization they would rather forget if they win.

Over on the GPS side, the industry is now erecting fences to fend off what it expects will be further challenges to its fiefdom. Unquestionably, the GPS community was ill prepared to defend its position and some say that without the DOD going to bat for GPS, LightSquared might have come out the winner. Probable early actions will include the development of international GPS receiver standards toward greater resilience in difficult signal environments that, ironically, could include the interference-resistance technology developed by GPS manufacturer Javad to assist LightSquared in its efforts to counter GPS industry claims against high-powered jamming.

Certainly, there will be similar challenges to GPS in the future as radio spectrum becomes even more congested. In retrospect, therefore, it looks as though the recent close encounter may well turn out to have been a valuable wake-up call to the industry.