The FCC just gave the green light for EchoStar to sell off its spectrum licenses. AT&T is buying some, and SpaceX (Starlink) is grabbing the rest. The total price tag? A cool $40 billion.
This all started when FCC Chairman Brendan Carr wasn't happy with how EchoStar was using its spectrum. He basically told them to sell it or risk losing the licenses. Last year, Carr threatened to revoke the licenses after SpaceX alleged that EchoStar subsidiary Dish Network “barely uses” the spectrum to provide mobile service to US consumers. Dish had obtained a deadline extension for its network deployment obligations from the Biden-era FCC, and Carr objected to the agreement made with the previous administration.
So, EchoStar, led by Charlie Ergen, made deals with SpaceX for $17 billion and AT&T for $23 billion. AT&T gets 30 MHz of nationwide spectrum in the 3.45 GHz band, plus 20 MHz in the 600 MHz band. This gives AT&T more options for its 5G and fixed wireless networks, both mid-band and low-band. SpaceX is picking up 65 MHz of nationwide spectrum between 1.695 GHz and 2.2 GHz. They'll use it to beef up Starlink's satellite mobile service, which T-Mobile phones can already tap into.
But, there's a catch. EchoStar isn't thrilled about a condition the FCC tacked on. They want EchoStar to put $2.4 billion into an escrow account. This money would compensate construction companies that were hired to build the Dish network. EchoStar's Boost Mobile will keep offering wireless service, but it'll be running on AT&T's network instead of EchoStar's. Boost Mobile will also get access to Starlink's mobile network through the deal with SpaceX. EchoStar issued a statement suggesting it may fight the escrow requirement.
A group representing rural mobile carriers isn't happy either. They say the FCC ignored their concerns about competition. According to the Rural Wireless Association, these spectrum sales “continue the troubling pattern of spectrum aggregation that disadvantages rural wireless providers, stifles competition in the wireless marketplace, and hinders the deployment of wireless services—particularly in the hardest-to-serve rural areas.”
Even though Starlink isn't a traditional wireless carrier, they're aiming to dominate the direct-to-device market. This involves using satellites to provide service directly to standard mobile phones. AT&T's purchase of EchoStar's licenses just continues the trend of spectrum consolidation among the big three carriers: AT&T, Verizon, and T-Mobile.
