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The approval will provide EchoStar with a much needed windfall
The Federal Communications Commission (FCC)’s Wireless Telecommunications Bureau and Space Bureau have granted approval to EchoStar to sell its spectrum to SpaceX and AT&T.
EchoStar agreed to sell 50MHz of spectrum in the 3.45GHz and 600MHz bands to AT&T for around $23 billion in August last year. This was followed in a month later by a $17 billion sale of 65MHz of AWS-4 and H-block spectrum licences to SpaceX.
AT&T, which is already using the spectrum in question to improve its network performance for mobile and fixed wireless access (FWA) customers under a licencing deal with EchoStar, will be required to accelerate its 600MHz network deployment.
SpaceX, on the other hand, has received FCC waivers that would allow it to use the spectrum for terrestrial, space-based, or hybrid services.
EchoStar’s spectrum saga, perhaps confusingly, has its origins in the 2020 merger of T-Mobile and Sprint.
As part of the deal’s regulatory conditions, EchoStar’s sister company Dish Mobile agreed to buy Sprint’s mobile virtual network operator Boost Mobile, pledging to become the fourth national mobile operator (MVNO). It soon became clear, however, that this was merely a pipe dream, with Dish failing to build the required network infrastructure and struggling under substantial debt.
Ultimately, this led to EchoStar merging with Dish in 2023, with the move largely seen as an attempt to balance the books for both companies. EchoStar was thus left with a large tranche of spectrum that it would struggle to use.
The spectrum sale, therefore, represents a significant financial lifeline for EchoStar. In September, EchoStar said it expects to hold around $24.1 billion in total cash after the deal, which it will use to repay debt.
Following the deal, EchoStar will still offer mobile services to customers via a mobile virtual network operator (MVNO) agreement with AT&T.
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