Dish Responds to FCC's Move to Deny Spectrum Auction Discounts

By Shalini Ramachandran 

Dish Network Corp. confirmed Wednesday that Federal Communications Commission Chairman Tom Wheeler has circulated a draft order to deny $3.3 billion in small business discounts sought by the satellite provider's affiliated entities in an airwaves auction earlier this year.

In a statement, Dish Executive Vice President Stanton Dodge said "we respectfully disagree with the proposed denial of the bidding credits." He said Dish followed all the legal requirements needed to qualify and noted that the satellite provider's participation in the auction helped make it the "most successful" one in the FCC's history.

Dish said it met with the FCC's wireless bureau Wednesday and was told about the contents of the order, which was first reported by The Wall Street Journal last week. The FCC staff's analysis found that Dish does, in fact, have a "controlling interest" in its affiliated bidding entities, SNR Wireless and Northstar Wireless. Therefore, Dish's revenues were attributed to those entities, making them ineligible for the 25% bidding credit for small businesses under the FCC's rules, Dish said in the statement.

Dish provided 85% of the capital in both Northstar and SNR. But in filings with the FCC, both entities had reported revenue of less than $15 million and said that Dish didn't control them. The two entities won $13.3 billion in wireless licenses in the auction earlier this year.

The FCC found that SNR and Northstar are still eligible to hold those licenses, Dish said in the statement. The agency told Dish representatives in the meeting that it will not designate the matter for a hearing or refer it to the enforcement bureau or Justice Department.

The draft order still requires approval from a majority of the commissioners to go into effect.

An FCC spokeswoman declined to comment.

Write to Shalini Ramachandran at [e-mail]

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