The Federal Communications Commission reportedly plans to reject $3.3 billion worth of discounts Dish Network was set to receive after placing spectrum auction bids through subsidiaries to qualify for “small business” price cuts.
Dish’s strategy allowed it to make winning bids on $13.3 billion worth of wireless spectrum while only committing to spend $10 billion. FCC Commissioner Ajit Pai quickly cried foul after the auction, which ended in January, saying that “two companies in which Dish Network has an 85 percent ownership stake claimed over $3 billion in taxpayer-funded discounts. Those discounts came through the FCC’s designed entity (DE) program, which is intended to make it easier for small businesses to purchase spectrum and compete with large corporations. Dish, however, has annual revenues of almost $14 billion, a market capitalization of over $32 billion, and over 14 million customers.”
It turns out that Pai and FCC Chairman Tom Wheeler, who are often on opposite sides of contentious issues, agree that Dish shouldn’t be able to get these discounts. The Wall Street Journal reported last night that FCC staff has “concluded that the $13.3 billion in winning bids by two companies backed by Dish didn’t qualify for the small-business discounts because their bidding conduct violated the broad spirit of the auction’s rules” and that Wheeler has circulated a draft order to his fellow commissioners to rule on the matter.
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