Dish Network Wins FCC Approval For Cellular Spectrum

Michael Harper for redOrbit.com – Your Universe Online

Julius Genachowski and the FCC have approved Dish Network’s entrance into the cellular market by allowing the satellite TV company the rights to some very valuable spectrum, a decision that marks the end of a long process for the satellite TV provider. The Colorado company has been trying to enter into the cellular market for over a year, but had to seek FCC approval in order to use the cellular airwaves.

The FCC unanimously voted in favor of this new plan for Dish, though the company still has issues with the rules the FCC wants to set in place. For now, it is one step closer to either rolling out its own network or partnering with another mobile operator in order to bring their cellular service to the US. The FCC claims this new plan will open up competition in a crowded cellular market place and are pleased to approve such a plan.

“These actions will help meet skyrocketing consumer demand and promote private investment, innovation, and competition, while unlocking billions of dollars of value,” Tammy Sun, a spokesperson for the FCC, told Wall Street Journal‘s Sarah Portlock.

Jeff Blum, Dish Network’s senior vice president and deputy general counsel, also acknowledged this important step taken by the FCC and said his company is eager to get to work to bring their network to the masses.

“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,” Blum said in a statement.

Analysts are now busy trying to predict what Dish will do next with its newly acquired spectrum. Some have predicted Dish Network will use Sprint as a MVNO (or Mobile Virtual Network Operator) in order to get their cellular business off the ground. These type of arrangements allow one company to offer cellular service under their name but on another company’s network.

According to Bloomberg, both Dish and Sprint have been speaking with Genachowski about these dealings. Unnamed sources have even told Bloomberg that Sprint would be willing to sign such a deal if they were given access to some of Dish’s new spectrum as well. While they did not offer any comments about a partnership between themselves and Dish, Sprint did comment on yesterday’s decision by the FCC, calling it “a balanced and equitable decision.”

“By allocating this spectrum for commercial broadband use, the Commission is helping to bring more wireless broadband directly to consumers,” said Larry Krevor, Sprint’s vice president for government affairs in an emailed statement to Bloomberg.

Dish doesn’t have to seek FCC approval to begin a cell phone service. With their satellite licenses, Dish has the allowance to begin running a satellite phone network. However, such phones are large and expensive. In order to get in on the consumer phone market, they had to seek FCC approval. Though they are pleased to be moving forward in this process, Dish still has some complaints about potential restrictions the FCC has for their new spectrum.

Because this proposed spectrum is so close to other occupied bands, the FCC has proposed to place a power restriction on Dish’s airwaves to avoid interference. This would make Dish’s new network (the same one that’s supposed to open up new competition in the mobile marketplace) slower than the existing Big Three: AT&T, Sprint and Verizon.

A few weeks before this plan was accepted, Dish’s executive vice president R. Stanton Dodge said these restrictions could “cripple our ability to enter the business.”

Though the plan has been passed, it has not yet been made official, and Dish will now use this time to fight for the speeds they want.

Though these issues remain, one analyst has said yesterday’s approval by the FCC is still big news for Dish.

“No matter how you slice it, this is a transformative outcome for Dish to expand beyond its pay-TV business,” said Paul Gallant, a managing director at Guggenheim Securities. “Even if Dish loses the spectrum interference battle it’s been fighting, it still got most of what it wanted from the FCC.”

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