Issues

Dish Network May Lose Its $3 Billion Taxpayer-Funded Subsidy

FCC reviewing spectrum sale

Charlie Ergen, DISH's co-founder and current chairman, is a major Democratic donor. / AP

DISH Network is in jeopardy of losing its over $3 billion subsidy from the federal government that allowed the company to buy up half of the Federal Communications Commission’s (FCC) wireless licenses at its last spectrum auction.

The Wall Street Journal reported Tuesday:

The Federal Communications Commission may reject Dish Network Corp.’s attempt to benefit from billions of dollars in small business discounts during a record auction of wireless licenses, people familiar with the matter said Monday.

The possibility follows weeks of review and raises a new element of uncertainty around Dish’s haul of spectrum from the $45 billion auction that ended in January.

Dish surprised the industry earlier this year when it won $13.3 billion worth of bids in the auction—second only to AT&T Inc. — and when it claimed $3.3 billion in discounts aimed at small businesses. The company didn’t win any licenses or file for the discounts itself. Instead, it bankrolled two tiny companies called SNR Wireless and Northstar Wireless that placed all the winning bids.

In January, DISH Network was able to secure the $3 billion taxpayer-funded discount to purchase nearly half of the wireless licenses sold at the government auction through the FCC’s "designated entity" program, which is intended to help small businesses compete.

DISH’s co-founder Charlie Ergen is a major Democratic donor.

The Wall Street Journal reported that the FCC is in the process of reviewing the sale and is "still weeks away from an official determination."