Wireless Network Races for Funds
Hedge fund manager Philip Falcone is facing financial and regulatory deadlines as he moves to raise more funds—in the form of debt—for his plan to build a new high-speed wireless network.
The plan, which would be expensive and risky even for an established telecommunications firm, involves launching two satellites that would communicate with more than 30,000 wireless base stations across the U.S., and then selling high-speed wireless access to U.S. phone companies, cable operators and others that want to offer the service in areas currently without coverage.
Pressure is mounting on Mr. Falcone and his Harbinger Capital Partners funds to show more progress. The four-year-old plan is underpinned by Harbinger’s controlling stake in satellite-telecom company SkyTerra Communications Inc., which estimated in a recent earnings presentation that it would need to come up with about $211 million for the third quarter to cover costs related to the development of the network. Expenses include insurance for a satellite launch and development of wireless base stations.
