T-Mobile, Deutsche Telekom Oppose Extension of Dish's Rights to Buy 800 MHz Spectrum
T-Mobile US and parent Deutsche Telekom oppose Dish Network's move to delay until June 30 Dish's purchase of T-Mobile’s 800 MHz spectrum. Earlier this month, Dish asked the U.S. District Court for the District of Columbia to give it until that date to put together financing to buy the spectrum, which was part of a web of agreements around T-Mobile’s buy of Sprint (see 2308170065). Dish would have to pay a $72 million fee for walking away from the deal (see 1907260071).
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Dish cited “macroeconomic conditions” that aren’t its fault in seeking the delay. The current deadline is Wednesday. A 10-month extension would “provide DISH with time it needs to raise additional capital and obtain financing as it continues to expand and monetize its network, necessary precautions to DISH being able to complete the 800 MHz Spectrum License acquisition as anticipated,” Dish said.
“Our position is explained in the filing: DISH’s motion should be denied,” a T-Mobile spokesperson emailed Monday: “They continue to tie up valuable 800 MHz spectrum that they have not yet even committed to buy. Their hardship claim is a stalling tactic that is detrimental to putting this spectrum to use for consumers.” Dish didn’t comment Monday.
“DISH’s Motion boils down to this: interest rates are about 5% higher now than they were three years ago, meaning that the cost of financing a $3.6 billion purchase would be about $180 million more per year than in 2020,” T-Mobile and DT told the court Friday. “This higher interest, according to DISH, prevents it from ‘responsibly’ financing the acquisition of the 800 MHz spectrum licenses at issue right now, but DISH speculates that the situation may get better in ten months,” they said.
Dish fails to mention language in the judgment saying, “Defendants will not later raise any claim of hardship or difficulty as grounds for asking the Court to modify any of the provisions contained,” T-Mobile and DT said. “DISH’s Motion is predicated on exactly that,” they said. Dish also doesn’t mention “numerous public statements by the company’s senior executives that while DISH may like to acquire the 800 MHz spectrum licenses, they are not essential to DISH’s business,” the carriers said: “Contrary to the case law, DISH argues that as a divestiture buyer, it is entitled to special treatment under the law and is excused from the normal legal standard for obtaining a modification of the Final Judgment.”
T-Mobile and DT asked the court to reject Dish’s arguments that it will suffer various harms if the extension isn’t approved. “DISH says it has less low-band spectrum than the three nationwide incumbent carriers and acquisition of the spectrum licenses would enhance its uplink capacity,” but “this is contrary to the statements DISH has made to investors, that it does not need the spectrum and has met its FCC network buildout commitments without it,” they said. Dish also claims it could “lose the more than $1 billion that it has already invested in deploying radios compatible with this 800 MHz spectrum on its towers,” they said: “Even if some of the expense was incremental to make the towers compatible with 800 MHz spectrum, DISH does not say what that amount was or why it incurred that expense without taking adequate steps to ensure that it would be able to acquire the spectrum licenses to go along with” the investments.
Last week, Burns & McDonnell, an engineering and consulting firm, got permission to participate in the court proceeding (see 2308250058). “Contrary to DISH’s contentions, denying DISH’s motion will neither result in one of two incumbent carriers acquiring the Spectrum nor lead to associated competitive harms,” Burns & McDonnell argued: “Indeed, DISH itself has indicated that acquiring the spectrum would be ‘nice to have’ (not a ‘must have’) for the company.”