Winnick's death puts WCO's fight against T-Mobile in limboWinnick's death puts WCO's fight against T-Mobile in limbo

Gary Winnick, the Global Crossing founder backing WCO Spectrum in its fight against T-Mobile, died in November. As a result, 'WCO would like to defer any comment' until his estate is straightened out.

Mike Dano, Editorial Director, 5G & Mobile Strategies

December 1, 2023

4 Min Read
Gary Winnick
Gary Winnick.(Source: Gary Winnick)

Gary Winnick, the wealthy investor backing WCO Spectrum in its fight against T-Mobile, died on November 4. And now it's not clear what might happen to WCO.

"Mr. Winnick held a controlling interest in Defendant WCO Spectrum," WCO officials wrote in a November 16 court filing. "Defendants' counsel believes that the Estate of Gary Winnick is Mr. Winnick's likely successor in interest. However, Defendants' counsel does not yet know (a) the identity of the estate's executor; (b) the identity of the person authorized to act on behalf of the estate with respect to this case; or (c) the identity of the person authorized to act on behalf of WCO with respect to this case."

In response to questions from Light Reading this week, WCO CFO Susan Wegleitner wrote that the company is still plotting its next move.

"At this time, WCO would like to defer any comment until after the Winnick family has had time to work through various issues arising from the passing of their father," she wrote. "Gary Winnick was a visionary who believed in fighting for the non-profit institutions to obtain fair value for their spectrum holdings. His commitment to help underserved educational institutions maximize their asset value continues to drive WCO's mission."

The development is noteworthy considering T-Mobile filed a lawsuit against WCO in July, alleging the company engaged in a criminal scheme that cost T-Mobile $10 million. T-Mobile claimed WCO's efforts to purchase 2.5GHz spectrum licenses were "sham offers" and that WCO "lacks the capacity to make good on anything remotely approaching all of these offers."

WCO fired back in August, alleging that T-Mobile is engaging in a campaign of "threats, intimidation, and – most effectively – litigation" against schools and other educational institutions that own 2.5GHz licenses.

A battle over spectrum

As Light Reading has previously reported, WCO has been looking to purchase 2.5GHz spectrum licenses since the FCC changed its rules for the spectrum band in 2020. Before the FCC's rule change, only educational institutions – such as schools, universities and churches – could own 2.5GHz licenses.

However, purchasing such spectrum would essentially make WCO the spectrum landlord of T-Mobile. T-Mobile's midband 5G network is built atop roughly 2,000 spectrum leases with educational institutions nationwide. In some cases, those leases are decades old. The FCC's rule change for the band in 2020 was intended to eliminate that leasing complexity. As Light Reading previously reported, T-Mobile has acquired more than 200 of those licenses since the FCC changed its rules – but WCO has not been able to acquire any.

Winnick used his Global Crossing windfall to fund WCO's efforts. As noted by Doug Dawson, an analyst with CCG Consulting, in 1997 Winnick used a $35 million equity investment from himself and the Canadian Imperial Bank of Commerce to create Global Crossing. By 1999, the company was valued at $47 billion. But Global Crossing couldn't meet its debt payments after an acquisition spree, and went bankrupt in 2001. Winnick walked away from the company with more than $700 million.

"The value of spectrum globally is somewhere between $5 [trillion] and $7 trillion. It's an asset class that's never been created, and we are going to create it," Winnick told Light Reading during a 2022 interview in describing WCO's business model.

According to The New York Times, Winnick's Los Angeles mansion is up for sale for $250 million, the highest public price ever for a US home.

The struggles of WCO

A former WCO employee, who spoke to Light Reading on the condition of anonymity, said the company wasn't able to make progress against T-Mobile in the pursuit of 2.5GHz spectrum licenses.

Broadly, WCO was working to buy the spectrum licenses that T-Mobile was leasing. Doing so would essentially make WCO the spectrum landlord for T-Mobile in locations where it owned 2.5GHz licenses.

However, as Light Reading has previously reported, T-Mobile fought back with lawsuits against some of those schools. In its lawsuit, WCO said T-Mobile used the lawsuits as a "weapon" to block schools from selling their spectrum licenses.

The former WCO employee said that such lawsuits scared off school administrators from negotiating with WCO. He said school officials typically try to avoid legal entanglements at all costs – he said even an offer of legal indemnity from WCO couldn't entice school officials to sell their licenses to WCO.

Further, he explained that schools and universities generally operate with a view on the long term. As a result, he said school administrators were content to simply renegotiate their leases with T-Mobile in ten or 20 years, when the lease expired, rather than selling the lease immediately to WCO.

The WCO employee said that T-Mobile's hardball tactics seemed "egregious" but "it is what it is."

About the Author

Mike Dano

Editorial Director, 5G & Mobile Strategies, Light Reading

Mike Dano is Light Reading's Editorial Director, 5G & Mobile Strategies. Mike can be reached at [email protected], @mikeddano or on LinkedIn.

Based in Denver, Mike has covered the wireless industry as a journalist for almost two decades, first at RCR Wireless News and then at FierceWireless and recalls once writing a story about the transition from black and white to color screens on cell phones.

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