Dish Scraps Blockbuster Plans

Dish Network once hoped to turn Blockbuster and some new re-purposed satellite spectrum into a mobile video service. The plan, in April 2011, was to retain some of the Blockbuster retail locations to sell mobile devices supporting the new proposed service.

Those plans floundered when the Federal Communications Commission didn’t quickly approve a waiver allowing Dish to use its satellite spectrum for terrestrial data and voice transmission.

Dish indicates it has other plans for the Blockbuster assets, says Bloomberg.

Perhaps the mobile streaming plan was a high stakes gambit, but it was a gamble with small to negligible downside, with big potential upside.

When Dish acquired Blockbuster last year, the company had about $100 million in cash on the balance sheet. Shuttering and selling all 1,700 Blockbuster stores that Dish purchased would make Ergen’s company about $300 million, turning Dish a profit without using the brand for anything, Charlie Ergen, Dish CEO,  said.
The abandoned plan shows the growing importance of spectrum issues in creating, shaping or changing a number of communications and entertainment markets. LightSquared, for example, has so far been unable to launch its new wholesale Long Term Evolution network.
AT&T wanted to buy T-Mobile USA in large part for its spectrum assets. Sprint's board considered, then rejected, an early 2012 bid to buy MetroPCS. 
T-Mobile USA now wants to buy MetroPCS in part for its spectrum assets. 
Verizon has gotten approval to buy mobile frequencies from Comcast, Time Warner Cable, Cox Communications and Bright House Networks. 
AT&T is waiting for clearance of its purchase of more spectrum from NextWave.
The FCC now is trying to entice U.S. broadcasters to part with abandoned TV broadcast spectrum so it can be auctioned off to support U.S. Long Term Evolution networks.
And a new business based on use of "white spaces" spectrum might start in 2013 as commercial radios become available as well.