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Dish Says Proposed FCC Order On Wireless Spectrum "significantly Flawed"

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11/20/2012 10:37 PM ET

Dish Network Corp. (DISH: Quote) said Tuesday that a proposed order by the Federal Communications Commission related to rules that would govern wireless spectrum controlled by the satellite television provider was "significantly flawed". However, the company that the proposed order is not final.

Dish has spent more than $3 billion to acquire wireless spectrum in order to build a wireless U.S. cellular network that could compete in a market dominated by Verizon Wireless (VZ: Quote) and AT&T Inc. (T: Quote).

But the Federal Communications Commission or FCC has delayed Dish's application to use the wireless spectrum. According to reports, the FCC is working towards limiting Dish's spectrum to prevent interference with the H-Block, a chunk of spectrum in which Sprint Nextel Corp. (S: Quote) has expressed interest.

Dish, which controls controls about 40 MHz of broadband-ready AWS-4 wireless spectrum, said the proposed FCC order could add years of delay to network build out.

Stanton Dodge, executive vice president and general counsel of Dish said, "While the FCC's proposed order, based on reported accounts, does properly address some of the opportunities with this spectrum, it's significantly flawed by introducing serious limitations that impair its utility. While the FCC would grant full terrestrial rights, its proposal to lower our power and emissions levels could cripple our ability to enter the business."

Dish said that in the draft order, the FCC appeared to back a proposal that was advanced solely by Sprint, calling on Dish to disable 25 percent of its uplink spectrum and impair another 25 percent of its spectrum to accommodate possible future use of the adjacent H Block spectrum by Sprint.

Sprint has repeatedly urged the FCC to shift Dish's AWS-4 spectrum band up 5 MHz from 2000MHz-2020 MHz to 2005MHz-2025 MHz, so that the H Block PCS spectrum can be used to build its 4G LTE network.

Dish noted that the FCC does not currently license H Block spectrum, and that spectrum is currently unused. Sprint, which controls more than 200 MHz of wireless spectrum, has expressed interest in acquiring rights to the 5 MHz H Block.

Dish said the move was a zero-sum approach that would not result in a net spectrum gain for the American consumer, and would hurt competition as well as jobs.

Dish urged the FCC to adopt power and emissions levels that were originally proposed by the agency. The company noted that with appropriate rules, it was ready to invest billions of dollar that would result in the creation of tens of thousands of jobs.

Dodge said, "The H Block should be subject to the same auction and rulemaking processes that have applied to other spectrum bands for decades. This approach will ultimately free up the H Block for its highest-and-best use based upon input from all interested parties, and will lead to more investment, more jobs, more competition and more spectrum for wireless consumers."

DISH closed Tuesday's regular trading at $34.85. down $0.17 or 0.49 percent on a volume of 5.05 million shares. In after-hours, the stock further declined $0.30 or 0.86 percent to $34.55.

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by RTT Staff Writer

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