Dish affiliates will hand back a few spectrum licenses after controversy

Affiliates of Douglas County-based Dish Network Corp. on Thursday surrendered a few spectrum licenses back to the government, according to people familiar with the matter, after failing to secure a $3.3 billion small-business discount earlier this year. But it looks like that wasn’t the end.

After return of the licenses, Dish Network’s affiliates will have acquired a total of 505 AWS-3 licenses worth about $10 billion.

Dish’s affiliates would also have to pay a penalty on the licenses that they won’t acquire, the report said.

The deadline for the two companies to pay up the $3.3 billion was on Thursday, the official said. Indeed, the two have been “fined” about $413 million for being late and defaulting on around 200 of the regional licences.

DISH and Northstar Wireless and SNR Wireless are expected to have an average of approximately 75 MHz of spectrum nationwide, covering over 23 billion MHz-POPs.

Dish and partners had invested in separate companies with little to no revenue that can receive a 25 percent discount in auction bidding as “very small businesses”.

However, in August 2015, the FCC unanimously voted against DISH’s claim of a $3.3 billion discount. It bid via three smaller subsidiaries, two of which – Northstar Wireless and SNR Wireless – won frequencies.

The order concluded that Dish’s majority financial interest in the companies are controlling interests that should be attributable to Dish, which means the companies are ineligible for the $1.9 billion (Northstar) and $1.4 billion (SNR Wireless) bidding credits they had applied for. The commission then denied them the $3.3 billion discount for their bids in the record-setting auction that ended in January.

“DISH appreciates the diligent efforts of the FCC staff, and particularly the efforts of the Wireless Bureau, in working with DISH, Northstar Wireless and SNR Wireless regarding these arrangements”, that company said in a statement.