EchoStar Seeks More Time For 5G Network Buildout Milestones
Citing "unanticipated intervening global events beyond [its] control," EchoStar is seeking additional time to meet construction milestones attached to some of its wireless licenses. An advantage EchoStar has is that the FCC wants to see increased national wireless network competition, analysts told us.
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In a docket 22-212 filing this week, EchoStar said that while it met every milestone deadline in the FCC's 2020 order, it won't hit 2025 deadlines because of the "upended global economy and workforce and ... supply-chain disruptions" from the COVID-19 pandemic and "skyrocketing interest rates."
Against that backdrop, it also had to transition millions of Boost mobile customers from the legacy Sprint CDMA network to the T-Mobile network much more quickly than the three-year timeline T-Mobile provided to regulators during the T-Mobile/Sprint merger review, EchoStar said. "This premature migration required EchoStar to incur hundreds of millions of dollars in additional, unanticipated expenses and expend substantial operational resources to ensure its customer base retained service," it said.
An extension "will help EchoStar provide a competitive facilities-based service to more consumers nationwide, enabling them to benefit from the lower prices, higher quality service, and wireless innovations that result from EchoStar’s unique deployment and continued presence in the market." It's asking that final construction milestones for the AWS-4, AWS H block, lower 700 MHz E block, and 600 MHz licenses move from June 14, 2025, to Dec.14, 2026, and that final construction milestones for the AWS-3 Licenses be extended from Oct. 27, 2025, to Dec. 14, 2026.
In exchange for new deadlines, EchoStar is promising a series of commitments, including that its open radio access network will cover more than 80% of the U.S. population by year's end -- 30 million more points of presence than its 2023 70% commitment, it said. In addition, it would offer a nationwide affordable 5G plan and device to consumers and deploy 24,000 towers by June 14 -- 9,000 more than its 2023 tower obligation. It committed to be 3rd Generation Partnership Project Release 17 compliant by June 14 rather than its previous Release 15 commitment. Moreover, it said small carriers and tribes could lease EchoStar spectrum in the licensee areas subject to an extension. Some of its commitments are not nationwide but cover particular geographies.
"It's not a strong argument," Summit Ridge Group's Armand Musey emailed. But, he said, "I don’t think the current FCC wants to give up on a potential fourth [national wireless network] player until they really need to. That might change under a Trump administration." MoffettNathanson's Craig Moffett emailed that it's difficult to say what kind of reception the application will receive at the FCC. "The commitments to accelerate deployment are mostly in markets where the build has already been completed, so Dish is offering the sleeves from their vest," he said. "But the FCC presumably does want to see Dish succeed, improbable though that might be."