Is Dish Network Set to Launch Its Own Wireless Network?
After the Federal Communications Commission stalled Dish Network’s (NASDAQ:DISH) plans to launch its own mobile-phone service for nearly a year, the company’s proposal is now close to receiving approval. As Bloomberg reported on Tuesday, FCC Chairman Julius Genachowski and two other commissioners support an amended version of the company’s wireless network plan.
As Dish Network’s satellite-television business has begun to lose subscribers, the company has turned to the wireless carrier business to offset its losses. To this end, Dish has amassed a significant spectrum holding that the company believes could translate into a wireless service capable of competing with Verizon (NYSE:VZ) and AT&T (NYSE:T).
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In 2008, Dish acquired a 40 GHz spectrum from several bankrupt satellite companies for $3 billion. However, the spectrum band was originally designated for satellite communications, and the company had to petition the FCC to use the spectrum for a wireless service. After the the agency rejected Dish Network’s original request in March, the commission announced that it would conduct a formal review of the plan.
On November 20, Genachowski announced a tentative proposal to resolve the conflict. The FCC would allow Dish to use its spectrum to build a wireless network if the power and emissions for the company’s uplink spectrum were limited. The agency tagged this caveat onto its proposal in order to protect against interference on a neighboring spectrum band. It is this plan that is set to be adopted by the agency in the coming days.
But Dish Network has said that this limitation would be a “game changer.” The company’s Chairman Charlie Ergen told the Washington Post last month that the FCC’s proposal “cripples our ability to enter the business.” While this issue has not yet been resolved, Dish Network has proposed to use a portion of its spectrum as a so-called guard band to shield the adjoining H-block of spectrum owned by the federal government.
However, there are other solutions. Sprint (NYSE:S), which is expected to bid on the H-block when its auctioned off, has reportedly approached Dish Network regarding a partnership. In this deal, the company would be able to to offer wireless service over Sprint’s network, which would allow Dish to save on capital expenditures and implement the service faster. Google (NASDAQ:GOOG) has also be named as a potential partner.