Phil Falcone, a twenty-first century hedge fund manager, is making a three billion dollar bet on LightSquared, his new wireless network.
According to his website, LightSquared “will deploy an open wireless broadband network using a technology called Long Term Evolution (LTE), the most widely adopted 4G standard in the world. The LTE network will be combined with one of the largest commercial satellites ever launched, to provide coverage of the entire United States. The network is designed to support present-day and emerging wireless devices without restrictions.”
Do you understand what they're doing? I do too, kinda, sorta.
I get it that LightSquared is developing a satellite-based wireless network and will somehow make mobile applications better. But I don't know why they're doing it nor what's in it for me as a consumer.
Unfortunately for Falcone, AT&T, Verizon and others have figured it out. And those telecommunication giants are so concerned with LightSquared's business model that they're trying to keep it from succeeding.
Their advocacy group, the Coalition to Save Our GPS, is trying to block LightSquared from providing a 4G wireless network in rural areas.
On the coalition's website, it claims LightSquared “plans to transmit ground-based radio signals that would be one billion or more times more powerful as received on earth than GPS's low-powered satellite-based signals, potentially causing severe interference impacting millions of GPS receivers—including those used by the federal agencies, state and local governments, first responders, airlines, mariners, civil engineering, construction and surveying, agriculture, and everyday consumers in their cars and on handheld devices.”
Pretty scary, huh?
What the coalition doesn't say is that if today's GPS receivers had been designed and constructed differently in the first place, there would be no problem. But even though the manufacturers of older GPS receivers were put on notice by the government for interfering with LightSquared's legally licensed spectrum, they did nothing. Instead they are now using political channels and fear tactics to get their way.
By blaming LightSquared for a potentially fearful doomsday scenario (first responders getting lost, planes colliding in midair, your car's navigation system not working, etc.) the major telecoms can confuse the issue and redirect blame directly onto their potential competitor. And because the problem is mostly technological, few consumers, investors or legislators understand the actual issues and will instead make up their minds based on the emotional cues of the lobbying.
It's not as if there's not regulation already. The Federal Communications Commission allowed LightSquared to start buying broadband spectrum in 2003. According to Falcone, “We were mandated to build this network and now the GPS community is saying, ‘They're interfering with us.'” (But the other companies) “didn't put the proper filtering on their devices. We're not interfering with them. They're interfering with us.”
What's more, Falcone said “99 percent of the problem” will be solved by LightSquared using a different part of the broadband spectrum. This is a surprisingly cooperative move considering that the interfering companies are clearly leaking into LightSquared's real estate and not the other way around.
Do you understand the controversy better now that Falcone has explained the situation? Me neither. We still don't understand what LightSquared is doing or how it will benefit us. Falcone's delivery was a professional business-like response, but it was full of “speeds and feeds” tech-talk instead of emotional consumer benefits. Again surprising because Falcone is a straight-talking Minnesotan and could state his case clearly and concisely.
It should come as no shock that the most successful tech company on the planet, Apple, exorcised these “techxplanations” years ago. In his March iPad event, Steve Jobs said, “…a lot of folks in this tablet market are rushing in and they're looking at this as the next PC…and they're talking about speeds and feeds just like they did with PCs.”
As Joshua Topolsky, editor of Engadget, wrote,
“Apple no longer has to compete on specs and features, nor does it want to…it's not the RAM or CPU speed, screen resolution or number of ports which dictate whether a product is valuable; it's purely about the experience of using the device.”
Just like Steve Job's video announcements, Falcone has gone on TV. His goal is to inform people that LightSquared is investing in innovation and exercising their free market prerogatives while the entrenched GPS and communications players are using old-school scare tactics to halt their vision. But moving the conversation from “speeds and feeds” to emotional benefits has worked spectacularly well for Apple and could help solve LightSquared's problems, too. More importantly, there's a lesson here for all of us to keep our marketing communications “all about them” and to remember to appeal to our consumers' emotions before we appeal to their intellect (“hearts THEN minds”).