The Federal Communications Commission made a small step in bringing additional wireless spectrum assets to market by freeing up 40 megahertz of spectrum in the 2 GHz band for terrestrial mobile services. That spectrum was originally set aside for satellite-based telecommunications services and is currently core to Dish Network’s long-announced plans to enter the mobile space.
The decision will allow Dish to utilize 30 megahertz of spectrum in the so-called AWS-4 band as well as sets a plan to auction off 10 megahertz of spectrum in the so-called H-Block. Dish seemed cautiously supportive of the deal considering it was initially looking at gaining access to all 40 megahertz of spectrum in that band.
“The FCC has removed outdated regulations and granted terrestrial flexibility for most of the AWS-4 band,” noted Jeff Blum, SVP and deputy general counsel at Dish, in a statement. “We appreciate the hard work and focus of the FCC and its staff throughout this process. The Commission has taken an important step toward facilitating wireless competition and innovation, and fulfilling the goals of the National Broadband Plan. Following a more thorough review of the order and its technical details, Dish will consider its strategic options and the optimal approach to put this spectrum to use for the benefit of consumers.”
Sprint Nextel, which had argued for strict power limits on the lower portion of the AWS-4 band adjacent to its G-Block spectrum holdings in the 1.9 GHz band, seemed more pleased, noting it had interest on possibly bidding on the H-Block. The H-Block now lines up adjacent to Sprint Nextel’s 10 megahertz of G-Block spectrum that is the backbone of its current LTE deployment. Analysts have noted that Sprint Nextel would need to bolster its spectrum position in order to remain competitive with rivals in the rollout of LTE services.
“In this proceeding the Federal Communications Commission has made a balanced and equitable decision to adopt rules for the AWS-4 spectrum band that enable it to support innovative, competitive terrestrial wireless broadband services,” said Larry Krevor, VP of government affairs at Sprint Nextel, in a statement. “At the same time, the commission has moved forward toward auctioning the adjacent H-Block spectrum. Sprint is especially encouraged that the commission has indicated that it intends to hold the H-Block auction next year.”
Despite the seeming opposing views on the subject, reports continue to surface that Dish was in talks with Sprint Nextel regarding a potential network sharing arrangement that would see Dish’s spectrum and services housed on Sprint Nextel’s evolving network. The deal would be similar to one that Sprint Nextel had made with LightSquared that eventually was scuttled by LightSquared’s inability to gain control of its 1.6 GHz spectrum assets due to potential interference with some ground-based GPS systems.
“When it comes to the structure of a possible Dish deal, a spectrum-sharing and network-enabling agreement versus an outright merger would certainly appeal to Sprint, which years after its acquisition of rival Nextel is still wrestling with the costs and operational complexities of that deal,” noted Yankee Group senior analyst Rich Karpinski in a research note. “A Dish partnership could also potentially give Sprint a video partner to deliver next-generation multi-screen services, something larger rival AT&T has already done through its UVerse unit, and Verizon is tackling even more aggressively via its own FiOS offering and co-marketing agreements with large cable providers.”
Dish has been rumored to be in talks with a number of players regarding plans to bring a cellular service to market. Dish has been touting its plans to become a disruptive force in the wireless space, despite the billions of dollars that will be necessary to get its foot in the door.
“Some people dismiss us and say we can’t compete, while others want to know how they can help us get into the market,” noted Dish CEO Charlie Ergen at the PCIA event in October. “We are not that credible yet. … Invite me back in 5 years and let’s see how we did.”
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