"Sprint has been a valued partner to LightSquared and we look forward to working together in the future," said Doug Smith, chief network officer and interim co-CEO, in the statement.

The deal with LightSquared was one component of a complex plan by Sprint to bring together enough spectrum to offer a robust LTE service. Sprint also plans to reuse spectrum currently devoted to other services and to coordinate its LTE plans with Clearwire, in which it is the biggest shareholder.

Clearwire currently supplies Sprint's WiMax 4G network, and it plans to build its own LTE network. Since the FCC acted to shut down LightSquared's LTE plans, two wholesale customers of the startup have signed agreements with Clearwire.

The cancellation did not come as a surprise, and analysts who have been watching Sprint closely said the company probably is better off now.

"It allows them to focus on spectrum that is truly available," said Monica Paolini of Senza Fili Consulting. The best way for Sprint to secure enough spectrum for a strong LTE service is to work with Clearwire, she said.