Guggenheim: Globalstar has cleared last big hurdle for new service

|By:, SA News Editor

Globalstar's (NYSEMKT:GSAT) demo of its terrestrial low-power service (TLPS) went well, the company says -- and that's the "final major hurdle" to U.S. approval, says Guggenheim's Paul Gallant.

The company needs FCC approval to change how it uses satellite airwaves, and Gallant expects that to come now in a matter of months.

Globalstar expects the adoption of TLPS to increase U.S. Wi-Fi capacity by a third as well as improve wireless service.

NCTA, the cable operator lobbyist, says Globalstar still needs to establish that TLPS won't mess with its member companies' Wi-Fi: "We find it hard to believe the FCC would draw any conclusions from a non-scientific demo rather than real testing."

For its part, noted GSAT short-seller Kerrisdale Capital -- who posted a thesis in the fall saying the company's value was "zero" -- looks past the demo, saying "Interference isn't the issue for TLPS as a biz. The issue is that a paid/exclusive/licensable Wi-Fi channel isn't commercially viable."

Globalstar today: +7.1% to $3.15, its highest point since Sept. 30.

Previously: Globalstar +7.1% after noting successful FCC demo (Mar. 11 2015)

Previously: Globalstar builds on gains; still Kerrisdale's biggest short (Feb. 18 2015)

Previously: Globalstar -10.3% after Kerrisdale releases short report (Oct. 06 2014)

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