EchoStar Says SpaceX’s 2 GHz FCC Filings Represent ‘Anticompetitive’ Attempts to ‘Crush’ EchoStar’s ‘Nascent’ Hybrid Terrestrial/Satellite Service, Labels SpaceX Methodology ‘Completely Nonsensical’

Credit Research: Adam Rhodes, CFA
Regulatory Analyst: Mitchell McVeigh
Relevant Document:
EchoStar Letter

In this article, we’ll provide detail about these key questions:

1. Why is this FCC spectrum dispute critical for SpaceX’s long-term goals in satellite communications? 
2. How does EchoStar’s hybrid terrestrial-satellite service position it as a competitive player in this market? 
3. What does this regulatory battle between SpaceX and EchoStar reveal about the value and scarcity of spectrum rights for emerging technologies? 
4. Why should financial professionals and investors closely monitor the outcome of this debate? 
5. What broader implications does this dispute have on innovation in 5G and direct-to-device connectivity?

EchoStar in a statement to Octus, formerly known as Reorg, rebutted SpaceX’s April 14 letter to the Federal Communications Commission that claimed that new data shows EchoStar “barely uses the AWS-4 band” and that called on the agency to grant SpaceX’s long-standing request to allow new entrants into the 2 GHz band.

Yesterday, April 15, EchoStar also filed a letter with the FCC arguing that SpaceX’s March 20 letter to the agencyis a repeated attempt by SpaceX “to crush nascent competition from EchoStar’s own hybrid terrestrial/satellite service, which is progressing with the recent launch of the first satellite in EchoStar’s non-geostationary system, Lyra” (emphasis added).

As Octus previously discussed, EchoStar has engaged in a yearslong process to more fully utilize its global 2 GHz, or S-band, authorizations and expects that it is close to announcing a more robust direct-to-device non-geostationary orbit, or D2D NGSO, satellite constellation utilizing these rights. On the company’s fourth-quarter 2024 earnings call on Feb. 27, CEO Hamid Akhavan stated that EchoStar is “hard at work” developing “the most capable offering” in D2D satellite service. He noted that it “is far beyond a messaging connectivity” and expected it to have “broadband connectivity … voice, video, just everything the same as you would have on your standard mobile phone.”

In its statement to Octus, EchoStar states that SpaceX’s April 14 letter to the FCC “distorts the truth” with “supposed geographic measurements.” EchoStar labels the methodology as “completely nonsensical, given that EchoStar is subject to – and has demonstrated – its terrestrial deployment based on population-based milestones.”

SpaceX’s April 14 letter argued that “new measurements show that [EchoStar’s] DISH uses less than 5% of what would be expected from an actual wireless network operator.” SpaceX also suggested that DISH had failed to satisfy its 70% population coverage nationwide buildout requirement of its AWS-4 licenses by June 2023.

Under the company’s FCC commitments, EchoStar pledged that by June 14, 2023, it would deploy a nationwide 5G network using DISH’s spectrum with “[a]t least 70% of the U.S. population having access to download speeds equal to or greater than 35 Mbps, as verified by drive test.”

The FCC confirmed in September 2023 that DISH met all of its June 2023 band-specific 5G deployment commitments, including its population coverage deployment metrics, required for the contingent extension of its AWS-4, H-block, 700 MHz and 600 MHz spectrum licenses. In the same letter, the FCC accepted DISH’s proposed drive test methodology for verifying compliance with its single remaining nationwide 5G commitment. In March 2024, EchoStar certified to the FCC that it completed the drive test commitment and, with the review of a third-party monitor, complied with the FCC’s agreed-upon methodology.

EchoStar’s complete statement to Octus responding to the assertions in SpaceX’s April 14 filing is below:

“SpaceX’s latest filing distorts the truth while missing the point. SpaceX presents supposed geographic measurements made by satellites to show terrestrial ‘underutilization’ of the 2 GHz band. But, such methodology is completely nonsensical, given that EchoStar is subject to – and has demonstrated – its terrestrial deployment based on population-based milestones. Perhaps SpaceX is confused because it has never publicly filed a detailed deployment report for the 15,000 MHz of spectrum it received free of charge from the FCC.

“In contrast, EchoStar has purchased more than $35 billion of wireless spectrum licenses, and it has spent billions more actually deploying it to serve U.S. consumers. If SpaceX had done even a basic search of public filings, it would know that EchoStar extensively utilizes the 2 GHz band and that the FCC itself has confirmed the coverage, utilization and quality of EchoStar’s 5G network based on independent drive-tests. EchoStar’s deployment already reaches over 80 percent of the United States population with over 23,000 5G sites deployed.

“SpaceX is once again trying to change long-standing FCC precedent based on faulty methodology in a desperate land grab for even more spectrum. The FCC should immediately reject this transparent attempt to hijack competition, hinder innovation, and impair national security.”

In addition to the purchase price of its spectrum licenses, EchoStar had spent over $7.3 billion in cumulative wireless network buildout capital expenditures through Dec. 31, 2024, according to Octus’ analysis.

EchoStar Says SpaceX Seeks to Hinder ‘Nascent Competition’

EchoStar also on April 15 filed with the FCC a response to SpaceX’s March 20 letter. EchoStar says that SpaceX’s recent actions are a repeated attempt “to crush nascent competition” from EchoStar’s own hybrid terrestrial/satellite service, which recently launched the first satellite in its Lyra NGSO system.

The company adds that SpaceX’s attacks on EchoStar’s 2 GHz mobile-satellite service, or MSS, authorizations appear “to be about harming EchoStar’s nascent hybrid terrestrial-satellite service in an attempt to thwart competition.”

EchoStar says that SpaceX’s March 20 letter “is simply a sequel to its anticompetitive, chronically (four times)-rejected attempts to invade the 2 GHz band.” SpaceX’s “fifth attempted bite at the apple should meet the same fate as SpaceX’s previous four attempts,” EchoStar adds.

As Octus previously discussed, EchoStar has engaged in a yearslong process to more fully utilize its global S-band authorizations, and we expect that in the near term a number of factors are aligning for the company to advance these efforts with a robust D2D low earth orbit constellation and potential partnership. Industry participants speculate that MDA Space, the prime contractor for Globalstar’s planned D2D constellation, is in line to manufacture an EchoStar constellation, with Apple serving as a partner.

In its April 15 letter, EchoStar explains that it has received experimental authorization to operate its new NGSO system Lyra in the 2 GHz band in the United States and that it “will eventually apply for a full authorization” (emphasis added). EchoStar adds that “SpaceX’s outrageous demand would have the effect of dismantling EchoStar’s capabilities for dual MSS and 5G wireless services in the 2 GHz band.”

The FCC has “repeatedly found that EchoStar has valid and active 2 GHz authorizations contrary to SpaceX’s claims,” EchoStar continues. The FCC’s repeated confirmation and renewal of EchoStar’s 2 GHz MSS authorizations prove that SpaceX’s claim that EchoStar’s market access to the 2 GHz band expired years ago is “demonstrably false,” EchoStar adds.

Additionally, EchoStar insists that it has complied with its latest 5G terrestrial buildout deadline, and earlier this year confirmed that its Open RAN network covers 80.09% of the U.S. population, which EchoStar achieved “by using its AWS-4/2 GHz licenses.”

EchoStar adds that its AWS-4 licenses have been deployed for 5G services on over 23,000 towers in the United States and it is the largest 5G Open RAN network in the world. “As we try as a country to compete in the telecom space against China, SpaceX’s demand would impair American national security,” EchoStar concludes (emphasis added).

EchoStar also rebuts SpaceX’s assertion that EchoStar’s offer to lease AWS-4 spectrum to certain entities shows that EchoStar has not built out its 5G network in the 2 GHz band, claiming there is “no evidence at all” for the claim.

Moreover, EchoStar contends that SpaceX “defies logic” by asserting that EchoStar must acknowledge that its 2 GHz rights are secondary “to any current or future MSS operations” given that EchoStar is the only operator authorized to use the band for MSS operations. When the FCC in 2024 dismissed SpaceX’s application to use spectrum in the 2 GHz band, EchoStar says the commission “reaffirmed” that the band is limited to EchoStar due to “the impracticality of avoiding harmful interference if separate operators for MSS and terrestrial systems were authorized in the same band” (emphasis added).

Although the FCC dismissed SpaceX’s application to use the 2 GHz band in 2024, the commission sought public comment on SpaceX’s parallel rulemaking petition to revisit the MSS licensing and spectrum-sharing framework for the 2 GHz band. SpaceX’s rulemaking petition for the spectrum sharing in the 2 GHz band remains pending. A similar petition from SpaceX with respect to the 1.6/2.4 GHz, or Big LEO band, which is occupied by Globalstar, also remains pending.

In its April 15 letter, EchoStar reiterates its prior argument that granting SpaceX’s request to allow additional operations in the 2 GHz band would “render EchoStar’s AWS-4 licenses inoperable from the harmful interference” and would “upset billions of dollars of investment by EchoStar in reliance on the AWS-4 Order.”