Forrester’s Digest: EchoStar sells spectrum to AT&T for billions

Pay-TV operator EchoStar is selling $23 billions-worth (€19.8 billion) of terrestrial spectrum designed to improve 5G and home Internet access.

AT&T and EchoStar have also agreed to enhance their long-term wholesale network services agreement, enabling EchoStar to operate as a hybrid mobile network operator providing wireless service under EchoStar’s Boost Mobile brand. AT&T will be the primary network services partner to EchoStar as it continues to serve wireless customers.

AT&T says it will acquire approximately 30 MHz of nationwide 3.45 GHz mid-band spectrum and approximately 20 MHz of nationwide 600 MHz low-band spectrum for approximately $23 billion in an all-cash deal, subject to certain conditions.

The agreement will see improved AT&T services in some 400 urban and suburban markets in the U.S.

The deal eases the financial pressures on EchoStar which only a few weeks ago was rumoured to be considering bankruptcy. EchoStar’s share price rocketed 74 percent on the deal’s announcement.

However, despite the wording of co-operation between EchoStar and AT&T, the deal seem to put an end to EchoStar’s hope of becoming the USA’s fourth cellular nationwide network. EchoStar will now become a hybrid mobile network operator, which is a carrier that operates on its own network, in addition to using other companies’ infrastructure.

John Stankey, Chairman and CEO, AT&T, said, “This acquisition bolsters and expands our spectrum portfolio while enhancing customers’ 5G wireless and home internet experience in even more markets. No one brings wireless and fiber internet to more places or does it better than AT&T – and we do it with the industry’s first and only guarantee for both wireless and fibre. We’re adding fuel to our winning strategy of investing in valuable wireless and broadband assets to become America’s best connectivity provider.”