Deere Says LightSquared May Cost Farmers $30 Billion Annually

Philip Falcone’s LightSquared wireless service would disrupt farm equipment guided by the global-positioning system, costing the agriculture industry as much as $30 billion a year, Deere & Co. (DE) told U.S. regulators.

A revised proposal from LightSquared aimed at lessening interference fails to ease disruption to GPS devices, Deere told the Federal Communications Commission during an Aug. 18 meeting at the agency in Washington. The meeting was disclosed in an Aug. 22 filing with the FCC.

LightSquared would cause “severe harm to critical high- precision applications” of GPS technology, such as agriculture, construction and aviation, Deere, the world’s largest maker of farm equipment, said in a presentation to agency officials.

The FCC, which granted preliminary approval to LightSquared in January, is considering whether to grant final clearance to the company’s plan to build a wholesale wireless network serving as many as 260 million subscribers over airwaves previously reserved mainly for satellites.

Makers and users of GPS devices, which rely on satellite signals, say LightSquared would disrupt navigation by aircraft, boats, tractors and automobiles. On June 30, LightSquared offered to use only part of its airwaves, a step it said would end interference concerns for 99 percent of GPS receivers.

Deere’s cost estimate of up to $30 billion for the agriculture industry is “just the kind of fear mongering and hysteria that they have used to press their case for the last nine months,” Jeffrey Carlisle, executive vice president of regulatory affairs for LightSquared, said in an interview today.

The estimate “assumes the second we start operating, GPS would be totally unavailable, which is absurd,” Carlisle said.

40,000 Base Stations

LightSquared, which is backed by Falcone’s Harbinger Capital Partners hedge fund, plans to build 40,000 base stations to support its proposed service. The company received clearance for its network in a series of decisions dating back to 2003, Falcone said in an Aug. 4 interview on CNBC.

Falcone said his firm has invested about $3 billion in the Reston, Virginia-based venture. LightSquared and Sprint Nextel Corp. (S) announced a 15-year deal on July 28 to share network expansion costs and equipment in an effort aimed at making both stronger wireless competitors.

Regulators are trying to find ways for LightSquared to co- exist with GPS users who have complained of potential interference, FCC Chairman Julius Genachowski said at an Aug. 9 news conference.

Deere spokesman Ken Golden and FCC spokeswoman Tammy Sun did not respond to requests for comment.

‘Unacceptable Risk’

The Federal Aviation Administration last month concluded that LightSquared may cost 794 lives in aviation accidents over 10 years by disrupting satellite-aided navigation. General Motors Co. (GM) on July 29 asked regulators to bar LightSquared from some airwaves to prevent interference with its OnStar navigation service.

LightSquared would create an “unacceptable risk to public health and safety in aviation, emergency vehicles” and first responders, Deere told agency officials during its Aug. 18 meeting. FCC officials in attendance included Julius Knapp, chief of the agency’s technology office.

Deere said there are as many as 1 million high-precision GPS receivers in the U.S., and interference from LightSquared would cause “severe harm to commercial operations in many sectors.”

Tests of LightSquared’s service were “extremely rushed” and did not allow “time to properly characterize handset interference,” Moline, Illinois-based Deere said in its filing. The testing was conducted by a working group that included government officials, LightSquared executives and GPS industry representatives.

The FCC hasn’t set a deadline for its decision, and is considering whether more testing may be needed, Knapp told reporters Aug. 9.

-- Editors: Michael Shepard, Allan Holmes

To contact the reporters on this story: Eric Engleman in Washington at eengleman1@bloomberg.net; Todd Shields in Washington at tshields3@bloomberg.net

To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.