FCC Nixes Dish’s Small Biz Credits

August 18th, 2015 by · Leave a Comment

Dish's relationship with regulators and the wireless operators whose club it would like to join has long been, shall we say, complicated. Today, their efforts took a hit from the FCC, which has now officially ruled against the company's strategy for winning spectrum auctions.

Dish has been bidding for spectrum through two small companies, SNR Wireless and Northstar Wireless, that it argues qualified for a small business discount. They own 85% of the two, but describe that ownership as non-controlling due to the way the small businesses are structured internally. The arrangement had apparently saved them $3.3B on the $13.3B of spectrum they won in January, but the FCC is putting its foot down.

The vote was, for once, a unanimous one, and was widely expected.  Dish still disagrees, as you might expect, and says it has followed FCC precedent. It's a classic case of following the letter of the law while violating the spirit, so few tears will be shed for Dish. But Dish is right that such shenanigans aren't exactly its own invention.

Now the question is what effect this might have on Dish's ongoing pursuit of a deal for T-Mobile. If Dish is on the hook for $3.3B it didn't owe yesterday, that could change its ability to raise the money for such a deal at a reasonable price. On the other hand, Dish has come far enough down this road to entering the wireless business that turning back may not be a viable option.

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Categories: Government Regulations · Wireless

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