The growth of new technologies in cable broadband in recent years has greatly expanded the reach and value of its services. Whereas cable itself was once king, broadband now thrives with the emergence of streaming platforms and new social networking tools, all of which we can access on multiple mobile devices. As a result, spectrum demand nearly outpaces supply, and industry stakeholders and Federal Communications Commission (FCC) regulators are scrambling to ensure there is enough spectrum to support the growth of wireless innovation.
Unfortunately, not all participants in the industry have played by the rules. DISH Network recently deceived the FCC and undercut its competitors by circumventing the rules of the agency’s spectrum auction. Now, the company is trying to deceive the FCC again by backing a front group fighting the merger of Charter Communications and Time Warner Cable. Knowing DISH’s reputation and its own previous efforts to merge, it is essential that policymakers and the public cast a wary eye on the company’s actions.
DISH’s collusion in the last spectrum auction reveal a company that is willing to subvert the integrity of an FCC initiative in order to make unlawful gains in the market. Understanding the real threat of a spectrum deficit, the FCC established an auction to allow broadband companies to sell spectrum licenses to wireless providers. The auction should be a win for everyone, especially for consumers who are demanding more wireless platforms.
However, the actions of DISH compromised the success of the auction and perhaps threatened the availability of usable spectrum. After an FCC investigation, it was discovered that DISH had purposefully bought subsidiaries, little more than front groups, in order to secure a 25 percent small business discount on the spectrum licenses. In total, DISH and its subsidiaries bid for $13.3 billion worth of spectrum, which if accepted would have cheated taxpayers out of $3 billion.
DISH has since been ordered to pay $500 million in fines, and some 200 of the licenses it bid for were defaulted on. Despite calls by some FCC Commissioners to report DISH’s collusion to the U.S. Department of Justice, no further action has been taken.
Instead of getting their own house in order, DISH is now focused on fighting against the merger of Charter and Time Warner under the guise of a coalition called Stop Mega Cable. This proposed merger could benefit millions of consumers by expanding access to high-speed broadband and streaming video services, but DISH is once again using front groups in an effort to promote its own agenda. Netflix CEO Reed Hastings has stated, “The key thing about the Charter deal is it’s all Internet companies that benefit — us, Hulu, Amazon, HBO Now — so that we can all compete for consumers’ affection.”
The growth of innovation depends on the continued development of the cable broadband industry. DISH has proven that its Washington game is all about protecting its financial interests while paying lip service to the public interest. The company’s efforts to undermine New Charter are simply another example of its self-promotion at the expense of the industry as a whole. The FCC must consider carefully the intentions of DISH moving forward and not be fooled again.
David Williams is the President of Taxpayers Protection Alliance.