Dish is the Big Winner at the Auction House Thanks to the Chairman

February 13, 2015 - Written By Phil Bourget

Dish Network has been hard at work trying to get ahold of wireless spectrum during the AWS auction which as been going on for past couple of months.  Dish’s chairman Charlie Ergen had said before the auction that the FCC would be “pleasantly surprised”.  But what could he have meant?

Well, first, it’s important to know that the government (the FCC specifically), when it holds these auctions, is the one profiting from the bidding, obviously, since they are the ones that are selling this bandwidth to carriers and service providers.  It’s also important to note that these auctions don’t happen too often.  The last major, or comparably-sized, auction took place six years ago, and the FCC apparently have another auction planned for next year in 2016.

It’s also important to know how Dish handled the bidding compared to its competitors.  AT&T and Verizon Wireless each went about their bidding using one group or entity, which Dish reportedly went through three different ones.  Each of the three involved entities bid actively up through the latter parts of the auction, which concluded on January 29.  And on the topic of conclusion, the bidders aren’t allowed to disclose that bidding until later on Friday, the 13th.

Dish’s entities had reportedly bid on a wide range of licenses, and often multiple entities bid for the same license, helping to ensure two things: getting the winning bid and driving the price higher for competitors.  But what does price have to do with that?  Well, the U.S. government has apparently set a record with this auction’s outcome and price(s).  The auction had Dish spending enough to get half of the license that were for sale, with the total income of the sale being just about 45 million USD for the FCC.

Dish, in their various victories, didn’t raise the price’s themselves, between the three entities that did their bidding, in both senses of the word,  The victories, in fact, came from outbidding competitors rather than other self-operated entities, so there wasn’t a conflict of artificially raised prices to deal with, just success.

Dish’s chairman is also an avid poker player, so he likely was able to think like a bidder and a bluffer with the extremely high prices.  With dish’s shrinking support from its ever-shrinking group of TV service subscribers, so it should be interesting to see both what the bidding actually was like, when it is legal to discuss later on, as well as what Dish decides to do with its new digital turf.  Regardless, we’ll be eagerly awaiting the numbers from the most expensive auction in a while, and get back to you when we have some fact and figures.  Who would you have preferred to come out on top?  What do you hope Dish utilizes its bandwidth for?  And, as always, what will AT&T and Verizon do next to mess with their customers?  Let us know down below.