Dish: We likely won't 'meaningfully participate' in H Block auction

Dish Network (NASDAQ: DISH) indicated it does not plan to "meaningfully participate" in the FCC's upcoming auction of 1900 MHz PCS H Block spectrum, which could have large implications for Sprint (NYSE:S) and its competitors.

In a filing with the FCC, Dish detailed an Aug. 1 meeting its representatives had with FCC staff and explained several of its positions on current FCC agenda items, including the band plan related to planned incentive auctions of 600 MHz broadcast spectrum and 700 MHz interoperability. However, at the end of the filing, Dish explained its position on the planned auctions of several pieces of spectrum; the H Block had been the one most observers believed Dish would bid for.

Dish "explained that it supports taking a holistic approach to the upcoming spectrum auctions--including the auction of the H Block, 600 MHz spectrum, and AWS-3 bands--and hopes to work with the commission to determine the best ways to optimize this spectrum, as well as AWS-4. Dish shares the commission's goals of freeing up as much spectrum for auction as possible, maximizing revenue for FirstNet and the United States Treasury, and ensuring spectrum is efficiently utilized."

"However, given the current regulatory requirements for H Block and AWS-4, we conveyed that it is unlikely Dish will choose to meaningfully participate in the upcoming auction of the H Block," the company stated. A Dish spokesman did not immediately respond to a request to clarify Dish's statement in the filing.

The FCC said in a recent public notice that it could be ready to auction the H Block as soon as January 2014. The H Block is a 10 MHz block of paired airwaves that runs from 1915-1920 MHz (for the uplink) and from 1995-2000 MHz (for the downlink). The H Block is part of 65 MHz of spectrum Congress mandated the FCC to auction by February 2015.

Sprint has repeatedly expressed its interest in bidding for the H Block and using the spectrum to enhance its LTE service. Dish controls spectrum adjacent to a portion of the H Block, called AWS-4; Dish's 40 MHz of AWS-4 spectrum specifically runs from 2000-2020 MHz (for the uplink) and 2180-2200 MHz (for downlink).

The FCC said in a December order Dish Network must cover at least 40 percent of the population in areas covered by its spectrum with a wireless network in the next four years, or face penalties. Further, the FCC said Dish must cover at least 70 percent of that population within seven years.

Dish has said it plans to build an LTE Advanced network with its spectrum, but its wireless plans are up in the air after it failed to acquire Sprint this spring. Dish is also pursuing a plan to take control of LightSquared's L-Band spectrum. Investors will be awaiting word from Dish Chairman Charlie Ergen on the company's second-quarter earnings conference call Tuesday about how it might use its spectrum.

For more:
- see this FCC filing (PDF)
- see this WSJ article (sub. req.)

Related Articles:
LightSquared lenders rally behind plan by Dish's Ergen to buy company
FCC aims to auction H Block spectrum as soon as January
FCC tees up H Block spectrum auction for Sprint, Dish and others
Sprint shareholders approve SoftBank's $21.6B offer
AWS-2/PCS H Block - Spectrum auction guide
Dish must build 40% of its wireless network in 4 years, FCC says

Correction, Aug. 5, 2013: This article incorrectly stated Dish will report second-quarter earnings on Aug. 5; they will be reported on Aug. 6.

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