DISH Network Corp.
) has won the bid for PCS H Block wireless frequencies auctioned
by the Federal Communications Commission (FCC). The frequencies
can be used in all 176 markets in the U.S. DISH has spent
$1.56 billion for these wireless frequencies. This was the first
wireless spectrum auction in the U.S. after 2008.
The FCC will use the proceeds to develop a nationwide wireless
communication network for emergency services. Notably, DISH is
the only major company filing for applications. The remaining 33
companies, which include the likes of
NTELOS Holdings Corp.
), CSpire, Piedmont Rural and James Valley Cooperative Telecom,
are small regional telecom operators.
DISH, the second largest satellite TV operator in the U.S.,
has constructed an extensive wireless/satellite spectrum base
over the last seven years. The company's current spectrum holding
is 56 MHzs for which it has invested around $5 billion since
In 2012, the company purchased 2 slots of the 40 MHz S-band
wireless spectrum fromthe bankrupt TerreStar Networks Inc. and
DBSD North America Inc. for a consideration of $2.9 billion.
Moreover, the company owns a slot of 700 MHz airwaves.
Although DISH received the FCC approval to deploy a nationwide
wireless network, it came with a restrictive condition. The
constraint specifies that the wireless network deployment can be
executed using a truncated power level.
The regulator claimed that a reduction in DISH's frequency
level is required to avoid interference with an adjacent PCS H
Block frequency which it recently auctioned. The newly acquired
radio spectrums will significantly raise DISH's power and
emission levels to establish a profitable venture in the wireless
We believe DISH's attempt to enter into the wireless market is
a diversification strategy to counter pay-TV market saturation.
DISH enjoys the opportunity to collaborate with established
telecom or tech companies to jointly establish a wireless network
or monetize its spectrum holding for considerable profits.
In 2013, DISH lost to Softbank of Japan in its attempt to
). There were rumors in the industry circle that DISH may opt for
T-Mobile US Inc.
) in the first half of 2014. However, DISH recently declared that
it will not outbid Softbank in its effort to acquire T-Mobile US
also. DISH currently has a Zacks Rank #3 (Hold).
DISH NETWORK CP (DISH): Free Stock Analysis
NTELOS HOLDINGS (NTLS): Free Stock Analysis
SPRINT CORP (S): Free Stock Analysis Report
T-MOBILE US INC (TMUS): Free Stock Analysis
To read this article on Zacks.com click here.