Spending millions of taxpayer dollars establishing whether a company's business plan is viable is not usually government's role, but in the case of wireless-broadband hopeful LightSquared versus the GPS community, the effort may yet change the way the U.S. regulates the use of frequency spectrum worth billions.

How one U.S. government agency could approve a business plan that jeopardizes a public utility other government entities consider vital to safety and security, not to mention the economy, is the key question that has lurked behind the battle between LightSquared and the GPS industry since it ignited in earnest a year ago.

The answer emerging from countless legal filings and Congressional hearings is that the government itself is the villain of the piece, the absence of collaboration between agencies allowing one to act without consulting the others. In bypassing its normal processes to expedite approval of LightSquared's plan to use its mobile satellite service frequencies for a terrestrial broadband wireless network, the Federal Communications Commission (FCC) left its fellow Defense and Transportation Departments, Homeland Security and others, scrambling to protect GPS signals on which they now depend.

When the FCC granted LightSquared a waiver to use satellite frequencies adjacent to GPS for terrestrial transmissions in January 2011—conditional on resolving any interference issues—it sparked an unprecedented government-industry testing effort. The results leave little doubt that LightSquared's powerful transmissions will interfere significantly with sensitive GPS receivers—and leave LightSquared trying to blame GPS manufacturers for the problem, or face the cost of modifying or replacing millions of affected receivers used for everything from precision agriculture to precision approaches.

An independent agency, the FCC claimed to be acting in the public interest by boosting the Obama administration's national broadband plan when it approved LightSquared's proposal, but in bypassing the normal notice of proposed rulemaking step it short-circuited a technical process that would have addressed the GPS interference issue in an orderly matter. In the subsequent rush to perform tests, critics were quick to point out close personal and political links between President Barack Obama, FCC chairman Julian Genachowski and hedge-fund manager Philip Falcone, LightSquared's majority owner.

“Substantial federal resources, including over $2 million from the FAA, have been expended and diverted from other programs in testing and analyzing LightSquared's proposals,” John Porcari, deputy transportation secretary, testified to Congress on Feb. 8. “This level of investment in assisting a commercial applicant to achieve the successful approval of its government application is quite unusual,” he said. It was merited by the administration's commitment to increased access to broadband, “but given the results we reviewed, further investment cannot be justified at this time.”

Instead, and after letting industry take the lead in publicly fighting interference, the government is acknowledging the need to protect GPS into the future. Porcari told Congress that the Transportation Department proposes working with the National Telecommunications and Information Administration (NTIA) “to draft new GPS spectrum-interference standards that will help inform future proposals for non-space, commercial uses in the bands adjacent to the GPS signals, to strengthen existing national policy protection of adjacent band spectrum.”

Crucially for LightSquared and industry, the interference standards as described by Porcari would enshrine “the requirement for precision navigation devices to be able to use as broad a band as possible, as they have been to date.” Because the interference issue is caused by GPS receivers looking into adjacent bands, and not by LightSquared transmissions leaking into GPS frequencies, the company has been pushing the FCC to rule that GPS receivers are “unlicensed users” of its spectrum and therefore not entitled to protection from interference.

LightSquared has petitioned the FCC requesting the development of standards requiring commercial GPS receivers to be protected against interference from signals in nearby bands. Blaming the interference on “an industry decision to design and sell poorly filtered devices that purposefully depend on spectrum licensed to LightSquared for accuracy,” the company argues “sensible standards” would eliminate interference, enable more efficient use of spectrum and allow it to launch its broadband network.

Receiver standards are “not a useful approach,” Scott Pace, director of the Space Policy Institute at George Washington University, testified to Congress. Government-defined design standards would stifle innovation, he said. Instead, defining GPS spectrum protection criteria would “provide better predictability to new entrants” wanting to use frequencies adjacent to GPS.

Porcari said tests ordered by the FCC and NTIA, and analysis conducted by the FAA, have shown “there appears to be no practical solutions or mitigations that would permit the LightSquared broadband service, as proposed, to operate in the next few months or years without significantly interfering with GPS.” The FAA has “concluded that LightSquared's proposed terrestrial network is not compatible with requirements for low-altitude operations in the vicinity of LightSquared transmitters,” he said. Low-altitude operations including terrain awareness and warning systems, GPS-based approaches and departures, and automatic dependent surveillance-broadcast would be affected the most.

LightSquared has challenged their conduct and outcome, but Porcari said the results of tests by the National Space-Based PNT Systems Engineering Forum (NPEF) “were independently reviewed by Idaho National Laboratory and MIT Lincoln Laboratory, neither of which are affiliated with GPS industry.

“Both independent labs not only confirmed the NPEF findings, but felt that the NPEF may even have underestimated the magnitude of the harmful effects on the set of receivers tested,” he testified, adding “we believe no additional testing or analysis is warranted at this time.”