AT&T (NYSE:T) said the FCC should not place restrictions on how Dish Network uses its spectrum, according to a recent filing with the FCC. The carrier's position could reflect interest by AT&T in Dish's airwaves.
In a Jan. 26 filing with the FCC, AT&T also said that Dish should be held to the same buildout targets that the FCC imposed on LightSquared. The carrier also said the FCC should impose the same interference rules on Dish's mobile operations that it has placed on other 700 MHz licensees.
Dish is seeking the FCC's approval to build an LTE Advanced network with the 40 MHz of S-band spectrum in the 2 GHz range it purchased from TerreStar Networks and DBSD North America. AT&T said the FCC should not impose the kind of restrictions on Dish that it placed on LightSquared's proposed wholesale LTE network. The FCC has said that LightSquared needs FCC approval for the sale or leasing of more than 25 percent of its network capacity to one of the two largest terrestrial carriers by market share--AT&T or Verizon Wireless (NYSE:VZ).
AT&T said the FCC has no authority to place restrictions on how Dish uses its spectrum. "Imposing restrictions on commercial activities with specific parties in this instance would be anticompetitive, discriminatory, and the height of arbitrary and capricious administrative action," AT&T said.
However, public interest groups including Free Press, Public Knowledge, Consumers Union and the New America Foundation are urging the FCC to impose same kind of sale or leasing stipulations on Dish that the agency did with LightSquared. The groups are also urging the agency to approve the Dish transaction without delay in a bid to increase mobile broadband competition.
"We suspect that [AT&T's] interest in seeing the FCC impose LightSquared-like buildout requirements on Dish has little to do with the public interest, and much more to do with [AT&T's] interest increasing its negotiating leverage, when it comes to a potential transaction negotiation with Dish," Credit Suisse analyst Jonathan Chaplin wrote in a research note. "Why? Because onerous buildout requirements could increase Dish's interest in selling/dealing its spectrum."
AT&T CEO Randall Stephenson, thwarted by the Department of Justice and the FCC in the company's $39 billion bid to acquire T-Mobile USA, sharply criticized the FCC last week during the company's quarterly earnings call. He said AT&T needs more spectrum as soon as possible to help keep up with mobile broadband demand.
Dish is also requesting that the FCC waive its Ancillary Terrestrial Component (ATC) "integrated service" rule, and permit Dish to provide both dual-mode devices and single-mode terrestrial devices to customers who do not want the satellite function. That waiver request is similar to the one LightSquared was conditionally granted by the FCC. AT&T said such a waiver "will confer a substantial windfall on Dish." AT&T said in its filing that Dish should be held to the same terrestrial buildout targets as LightSquared: at least 100 million POPs within 33 months, 145 million POPs within 45 months and 260 million POPs within 69 months.
- see this AT&T FCC filing
- see this public interest filing
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