The FCC has voted to deny the US$3.3bn of bidding credits sought by affiliates of DTH giant Dish Network (NASDAQ:DISH) at the spectrum auction earlier this year. FCC Chairman Tom Wheeler said in a statement that the commission’s “thorough,…
The FCC has voted to deny the US$3.3bn of bidding credits sought by affiliates of DTH giant Dish Network (NASDAQ:DISH) at the spectrum auction earlier this year.
FCC Chairman Tom Wheeler said in a statement that the commission’s “thorough, fact-based analysis ensures that bidding credits only go to the small businesses our rules aim to serve”.
“Small businesses require an on-ramp into the mobile marketplace to provide more choices for consumers. Our competitive bidding rules were designed to do just that – give bone fide small businesses an opportunity to acquire valuable spectrum.”
Dish general counsel Stanton Dodge said the company is “respectfully disappointed” by the commission’s decision to deny the discounts.
“Our approach to the AWS-3 auction, which followed 20 years of FCC precedent and complied with all legal requirements, was intended to enhance competition — in the auction and in the marketplace long term.”
Dish will review the order when it is made available, as it considers its options going forward, he added.
Wheeler circulated a draft order to fellow commissioners to deny the discounts to the two affiliates, North Star Wireless and SNR Wireless, in late July.
Earlier this month, Dish CEO Charlie Ergen suggested the controversy surrounding the discounts had made a merger with T-Mobile US all but impossible.
He argued that allowing the discounts would have “created a lot of opportunity within the M&A space to get stronger people to compete against the top two guys [AT&T and Verizon], which really have a duopoly today”.
Ergen said Dish had yet to decide whether it would pay back the US$3.3bn in discounts to keep the licences, return the spectrum and incur a penalty, or file a lawsuit.
Dish bought US$13.3bn worth of spectrum via the two affiliates at the auction, prompting the FCC to review the rules surrounding discounts for designated entities (DEs). In mid-July, the commission voted to cap the credits available to DEs at next year’s incentive auction as part of reforms to bidding rules. These also prohibit joint bidding and multiple applications by parties with common controlling interests.
The FCC was not immediately available for further comment.
