- The closure of the FCC’s investigation ends a long, drawn-out process for EchoStar
- The company blamed the FCC probe for creating a “dark cloud of uncertainty” over its business
- Now EchoStar is set to collect more than $40 billion in two separate spectrum sales
FCC Chairman Brendan Carr notified EchoStar Chairman Charlie Ergen on Monday that his agency is ending its investigation into EchoStar’s 5G buildout and use of terrestrial and Mobile Satellite Services (MSS) AWS-4 spectrum.
The letter was delivered after EchoStar reached a deal to sell AWS-4 and H-block spectrum to SpaceX for about $17 billion, as well as 600 MHz and 3.45 GHz spectrum to AT&T for about $23 billion. The spectrum sales still require formal FCC approval, and more spectrum sales are expected as EchoStar winds down its wireless aspirations. Boost Mobile will continue operating on a “hybrid mobile network operator” basis.
Specifically, in his September 8 letter to Ergen, Carr said he directed FCC staff to: “(1) dismiss VTel’s petition for reconsideration; (2) confirm that EchoStar holds exclusive terrestrial and MSS rights over the AWS-4 spectrum to which it is currently licensed; and (3) find that relevant FCC buildout and other related obligations have been satisfied by EchoStar in view of the company’s current FCC milestones.”
FCC probe and ‘dark cloud’
Carr opened the investigation in May, triggering a major setback for the already beleaguered EchoStar. The company said the probe created a “dark cloud of uncertainty” over the company’s business, which further teetered on the brink of bankruptcy.
The stakes were high enough to attract the intervention of President Trump, who reportedly met with Ergen and Carr in the Oval Office in June. According to Bloomberg, the meeting concluded with the president encouraging Carr and Ergen to work together and reach some kind of deal to avoid a major company declaring bankruptcy during Trump’s second administration.
In his original letter to Ergen in May, Carr complained that EchoStar in September 2024 “negotiated behind closed doors” with the previous Biden administration to get its 5G buildout terms extended. That extension was contested by VTel Wireless, a wireless service provider in Vermont that unsuccessfully bid against Dish in AWS spectrum auctions.
Carr also pointed out that Boost Mobile had fewer subscribers than when EchoStar acquired the company five years prior.
He didn’t note that EchoStar’s Dish Network division acquired Boost Mobile as part of the first Trump administration’s Department of Justice (DoJ) insistence that a fourth facilities-based wireless carrier be created to take the place of Sprint. Dish’s purchase of Boost Mobile for about $1.4 billion was part of the government’s “remedy” in the approval of the T-Mobile/Sprint merger.
To be clear, the FCC leadership in 2019 was OK with three nationwide wireless carriers; it was the DoJ’s insistence that triggered the spinoff of Boost Mobile to Dish.
While the FCC has been investigating EchoStar over the past several months, Carr said there’s no “magic number” on how many nationwide wireless networks exist in the U.S., noting that cable companies, through MVNO arrangements, are taking the largest amount of market share in wireless.