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May 21, 2013

Dish Network Bids for LightSquared Spectrum

By Gary Kim, Contributing Editor

Dish Network has offered to buy LightSquared (News - Alert) spectrum, offering $2 billion for LightSquared's 60 MHz of spectrum. LightSquared has until May 31, 2013 to accept the offer.



Dish already has received Federal Communications Commission permission to use former mobile satellite service spectrum to create a terrestrial Long Term Evolution (LTE) network.  Dish acquired that spectrum for $3 billion from bankrupt satellite companies DBSD North America Inc. and TerreStar (News - Alert) Networks.

The reason for Dish Network’s interest in LightSquared spectrum is simple enough; Spectrum is the fundamental prerequisite for increasing bandwidth provided by any wireless network. Current LTE (News - Alert) networks, for example, generally are built using 10-MHz or 20-MHz blocks of spectrum, and there is a direct correlation between spectrum and the maximum possible access speed.

Where 20-MHz blocks can support downstream speeds of perhaps 300 Mbps, it takes a 40-MHz spectrum block to deliver gigabit access.

So additional spectrum is especially important if Dish Network believes video entertainment will be a core feature of its mobile network, and if Dish Network further expects fixed network headline speeds to creep up toward a 1-Gbps commercial standard.

As with most initiatives undertaken by Charlie Ergen, Dish Network CEO, there typically are a number of ways to monetize an asset. Ergen always has believed spectrum has value, whether to support an ongoing business venture or simply as an asset to be sold.

But most observers might agree that Dish Network is acting as though it has clear intentions of entering the mobile business, and is not simply "bluffing."

Whether he is right or not, Ergen believes the future of the video entertainment business is Internet delivery, and a good chunk of that business will require mobile access. To be sure, more efficient video coding will help.

But video remains the most bandwidth-intensive application any network is called upon to support. In early 2012, video streaming dominated mobile broadband consumption, representing 42 percent of all global bandwidth in the second half of 2011, up from 35 percent in the first half of that year, according to a February 2012 report from Allot (News - Alert) Communications.

Though forecasters might disagree about just how fast video consumption will grow, nobody disagrees that mobile data consumption will be lead by video, just as video drives bandwidth consumption on fixed networks.




Edited by Rachel Ramsey
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