Struggling financier Phil Falcone hopes to build a new $8 billion "4G" network  that could speed up wireless service for everyone. Thanks to the big gift of airwaves the FCC just handed him, he might just pull it off.

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Verizon (VZ) and AT&T (T) value their airwave licenses at a stunning $122 billion, so its no wonder they pitched a fit last year when financier Phil Falcone asked the Federal Communications Commission to give his start-up a cut-rate pass into their wireless club. Yet despite those objections, the FCC just did exactly that.

Last week FCC decided that a big chunk of the airwaves that Falcone's wireless startup had bought for next to nothing—since at the time those airwaves couldn't legally connect ordinary cell phones—will be usable by iPhones, Droids and Blackberrys after all. In an instant, Falcone's airwaves became vastly more valuable.

Such airwave alchemy—buying the rights to cheap, non-cellular airwaves and convincing the government to turn them expensive, cellular-capable airwaves—is the key to Falcone's plans for his new company, Lightsquared.

The FCC first approved Lightsquared's acquisition of a bunch of cheap airwaves last March. They came cheap because while the airwaves could be used to connect iPhones, regulations had restricted their use to satellite communications. As part of that deal regulators agreed to also let Lightsquared use those same airwaves to run a network of regular cell towers around the U.S. as an "ancillary service," thus allowing it to support a new type of wireless phone that offers both satellite and cellular connectivity. More