Lightsquared, Sprint sign 15-year expansion deal

Andre Yoskowitz
28 Jul 2011 13:02

LightSquared and Sprint have signed a 15-year deal, with the former paying Sprint to build and operate a nationwide LTE network.
The company will pay Sprint $9 billion in cash in the first 11 years, along with $4.5 billion in credits. Sprint can use those credits to acquire capacity from LightSquared once the network is up and running.
Says LS CEO Sanjiv Ahuja:

The benefit this provides is an acceleration of our buildout and at very efficient costs. This is very, very significant for LightSquared’s ability to build its business.

LS says with the deal it can offer services to 260 million Americans by the end of 2014, a year earlier than previously expected.
Sprint already had $5 billion earmarked for network upgrades within the next 5 years, so the latest deal will be a good source of revenue for the carrier. Additionally, the company can use LightSquared's network if capacity on their own WiMax network becomes overburdened.