It depends on whether the Federal Communications Commission (FCC) decides to start developing rules for flexible terrestrial use of spectrum assigned to the Mobile Satellite Service (MSS) in the 2GHz band. Dish is in line to gain access to 40MHz of S-band spectrum in that band via its acquisitions of TerreStar Networks and DBSD North America Inc. for a combined $2.8 billion.
Dish was counting on the FCC waiving the requirement that Dish's spectrum be applied to phones that support both land and satellite connections. But if the FCC dives into the MSS rulemaking, it would mean no waiver right away and a lengthy wait -- and Dish doesn't want to wait. Chairman Charlie Ergen has already said he'd explore all other options, including the sale of that spectrum.
The FCC's self-imposed deadline on the waiver decision is March 12, but the looming FCC vote (they call it a notice of proposed rulemaking -- a vote on whether to develop rules) could mean FCC Chairman Julius Genachowski is "disinclined" to grant the waiver, Stifel, Nicolaus & Co. Inc. analysts David Kaut and Christopher King wrote in a research note.
Why this matters
If Dish sells the spectrum, AT&T Inc. (NYSE: T) and T-Mobile US Inc. are among the carriers speculated to be interested in buying that capacity and perhaps partnering with Dish. But they may have to dig deep to get it. BTIG Research analyst Walter Piecyk tells Light Reading Cable that if Ergen is forced to sit on that spectrum without any buildout requirements, "it will continue to rise in value as smartphone penetration and data usage continues to rise."
Catch up on Dish's LTE ambitions.
- Dish: This Year's LightSquared?
- FCC Could Blow Up Dish's LTE Plan
- Charlie Ergen's Spectrum Grab
- Dish Sizing Up Mobile Broadband Service
- Dish's LTE Dreams Inch Toward Reality
— Jeff Baumgartner, Site Editor, Light Reading Cable