AST SpaceMobile aims to boost its direct-to-smartphone services by acquiring L-band spectrum from Ligado Networks, which faces bankruptcy due to derailed terrestrial 5G plans.
AST SpaceMobile is pursuing a long-term agreement to utilize up to 40 MHz of L-band Mobile Satellite Services spectrum in the U.S. and Canada, including an additional 5 MHz in the U.S. Ligado, which filed for bankruptcy, would gain warrants convertible into AST SpaceMobile shares valued at approximately $120 million, along with $80 million in annual cash payments. The deal, expected to extend at least 80 years, requires regulatory approval, including from the FCC.
To support the transaction, AST SpaceMobile has secured a $550 million loan. The integration of this spectrum, alongside 850 MHz of cellular spectrum from telecom partners AT&T and Verizon, could facilitate broadband speeds up to 120 megabits per second in remote areas lacking cell tower coverage.
The satellite operator has already deployed five Block 1 BlueBird satellites in low Earth orbit, equipped with advanced phased-array antennas to connect with mobile devices. These efforts are part of a broader campaign to deploy Block 2 satellites using Blue Origin’s New Glenn rocket, which are designed to deliver ten times the bandwidth capacity of their predecessors.
Although AST SpaceMobile is making strides, it still requires FCC approval to use its initial BlueBirds’ spectrum for beta services in the U.S., a key market. Ligado has encountered obstacles in the past due to GPS interference concerns that halted its 5G plans. It has since sued the U.S. government, claiming obstruction and seeking $40 billion in damages. Amidst bankruptcy restructuring, Ligado’s plan involves converting $7.8 billion of debt into equity, maintaining $1.2 billion in debt, with 88% of lenders in agreement.
Despite setbacks, Ligado continues to provide MSS services across North America using its geostationary satellites. It also collaborates with Viasat and Skylo to offer satellite-enabled SOS connectivity on modern Android smartphones, including Google’s Pixel 9 series.
The direct-to-smartphone market is evolving, divided between legacy MSS spectrum users and emerging companies like AST SpaceMobile that leverage cellular frequencies for connectivity. By securing spectrum resources, AST SpaceMobile positions itself strategically alongside other major players, with a focus on collaborations with telecom operators.
As AST SpaceMobile navigates regulatory requirements and leverages partnerships, its efforts to enhance smartphone connectivity through strategic spectrum acquisitions could redefine access to broadband services in underserved regions. In contrast, Ligado’s ongoing legal and financial challenges highlight the complexities of spectrum management and the dynamic nature of the telecommunications industry.
Source: Spacenews
