The flailing telecom company LightSquared received a weeklong extension from its creditors today, holding off bankruptcy yet again. But corporate raider Carl Icahn's patience has worn thin. Reuters reports that Icahn sold off his quarter of a billion dollars in debt holdings to Sound Point Capital. He turned a tidy profit, getting 60 cents on the dollar after paying 40 cents a few months ago.

Icahn's departure from the scene may take a bit of pressure off Philip Falcone, whose Harbinger hedge funds have invested $3 billion in LightSquared (Icahn had reportedly been pushing to end Falcone's role at the company). But it does nothing to clarify LightSquared's future.

The telecom start-up wants to create a high-speed wireless network on the 59 megahertz on the U.S. spectrum it controls. The plan is in limbo after the Federal Communications Commission -- under heavy fire from the Pentagon and the GPS industry, which claim the network would interfere with their signals -- said it would revoke LightSquared's spectrum-licensing permissions. LightSquared spent $1 million lobbying the government in the first quarter of this year alone, but so far hasn't changed anyone's mind.

LightSquared's apparent death throes highlight the long-term failure of the government to come up with a coherent management plan for the broadcast spectrum. The FCC's plan is to hold "incentive auctions" at which television broadcasters could sell off their unused spectrum holdings. But the FCC is nowhere near its goal of making 300 megahertz available by 2015, and it hasn't made a convincing case that it can balance the needs of smaller companies and giants like Verizon and AT&T.

The View editors have urged instead to have the government rent spectrum space to all parties, the military and government agencies as well as corporations. This would take away the incentive for license holders to sit on unused portions of the spectrum and encourage them to improve transmission and reception technology to avoid the sorts of interference problems that have bedeviled LightSquared.

Falcone had the right idea: We need more wireless capacity and competition among providers. Now he has a week to convince creditors that his dream is not dead.

(Tobin Harshaw is a member of the Bloomberg View editorial board. Follow him on Twitter. Subscribe to his e-mail newsletter, Share the View.)