The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.NEW YORK ( Trefis) -- After months of postponment, Sprint ( S) finally gave up on its LTE deal with Lightsquared last Friday. Sprint had extended its Dec. 31, 2011 deadline to March 15 to give Lightsquared more time to secure regulatory approvals for its LTE network plans. However, the FCC said last month that it will not be able to grant clearance for the proposed network as it found potential interference issues with GPS receivers that could harm public safety. With Sprint's relationship with Clearwire on a much stronger footing now, it made little sense for Sprint to continue to hope for a Lightsquared turnaround. Instead, it can now give its own as well as Clearwire's plans to aggressively deploy LTE networks complete attention as rivals Verizon ( VZ) and AT&T ( T) continue to add more markets to their ever-expanding LTE footprint. .
However, Sprint will have to fork over $65 million as separation fee now that it has terminated its contract with Lightsquared. With the company already having guided an aggressive 2012 in terms of capital expenditures for its Network Vision Plan, this could put further strain on its balance sheet. We believe that although the company may end up with a little less cash by the end of this quarter, it should be thanking its stars that it didn't put all its eggs in one basket. As for Clearwire, it's been a swift change in fortunes. Only a few months back, it was considering defaulting on an interest payment. Now, with Lightsquared's LTE plans floundering, Clearwire has one less wholesale competitor in the market and Sprint's backing and enough cash to put its LTE plans to work. Lightsquared's clients have also been slowly defecting and signing up with Clearwire one by one. Lately, we have seen two of former Lightsquared clients, FreedomPop and Leap Wireless, publicly switch allegiances. Clearwire's shares were up almost 6% last Friday. Click here to find out how a company's products impact its stock price at Trefis. Like our charts? Embed them in your own posts using the Trefis Wordpress Plugin.