Falcone Talking With Sprint (S) to Build Out Network

Philip Falcone’s LightSquared Inc. wireless venture is in discussions to use Sprint Nextel Corp.’s (NYSE:S) cell sites and equipment to help build out its network, three people familiar with the talks said.

The deal would allow LightSquared to roll out its network more quickly and at lower cost, said the people, who declined to be identified because the talks aren’t public. Sprint’s plan to spend $5 billion in infrastructure upgrades would leave it with extra capacity it can offer to LightSquared, the people said.

LightSquared, backed by billionaire Falcone’s Harbinger Capital Partners hedge fund, is seeking to compete with AT&T Inc., Verizon Wireless and Clearwire Corp. in selling so-called fourth-generation wireless service that offers faster Internet browsing. Sprint buys 4G capacity from Clearwire, and AT&T and Verizon are building out their own 4G networks this year.

Falcone has committed billions to challenge LightSquared’s larger and more established rivals, and he is facing government deadlines for building out his network. Falcone agreed last year to Federal Communications Commission conditions that he employ a combination satellite-terrestrial network for as many as 100 million Americans by the end of 2012 and 260 million by 2016.





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