Dish Network Cries “Foul!”

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Like most cable and mobile carriers, Dish Network Corp. (NASDAQ: DISH) has been seeking ways to bundle TV, Internet and mobile phone service in one integrated offering that would help the company lock-in customers and boost revenues. In May, Dish filed with the Federal Communications Commission (FCC) for just such a package deal.

The FCC chairman yesterday proposed that Dish be allowed to a portion of the lower power spectrum near the frequencies that the company uses to provide its satellite TV service. Dish is not impressed, saying that the low-power spectrum “would cripple our ability to enter the [integrated services] business.”

Dish spent more than $2 billion in late 2010 to acquire terrestrial spectrum that it would then use to offer a hybrid terrestrial-satellite broadband service. But the service depends on high-power spectrum licenses that would deliver broadband speeds.

The low power proposal from the FCC is intended to avoid interference issues in the currently unlicensed H block spectrum. Sprint Nextel Corp. (NYSE: S) has asked the FCC to require Dish to disable 25% of its uplink spectrum and throttle another 25% in order to accommodate Sprint’s possible future use of the nearby H block spectrum.

The competition for wireless spectrum is intense, as 4G networks have significantly boosted the amount of data customers use. Verizon Communications Inc. (NYSE: VZ) recently paid $3.9 billion for additional spectrum, and AT&T (NYSE: T) reached agreement with Sirius XM Radio Inc. (NASDAQ: SIRI) regarding possible interference issues in another part of the wireless spectrum.

The Dish Network press release related to the FCC proposal is available here.

Paul Ausick

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