Dish Network is Surprise Winner in AWS-3 Spectrum Auction

AT&T spent $18.2 billion to acquire AWS-3 spectrum; Dish Network won $13.3 billion; Verizon bought $10.4 billion worth of rights and T-Mobile US committed $1.7 billion in recently-completed auctions of 700-MHz spectrum.

AT&T seems to have won most of the 10 MHz by 10 MHz allocations nationwide, while the other bidders mostly won the 5 MHz by 5 MHz allocations.

Dish Network perhaps was the surprise, committing the second-largest amount of money in the auction. The issue now becomes whether Dish Network will commit to building a new mobile network, or will sell the spectrum rights to another company.

By some estimates, Dish Network’s mobile spectrum is worth perhaps $20 billion.

The huge unanswered question is "what happens next," where it comes to Dish Network and its mobile strategy. Some skeptics have been willing to believe, all along, that Dish Network ultimately would simply try to monetize its spectrum assets by selling them or leasing them to another existing mobile service provider.

The success of that strategy hinges on whether one of the leading providers is willing to pay what Dish Network wants, in terms of price. Most observers looking at that scenario would see Verizon as the likely buyer.

But Verizon has sent some signals it does not need to buy Dish Network's spectrum. Perhaps that is because it always is possible that Sprint might sell some of its excess spectrum to Verizon, instead.

Dish Network's chairman is, quite literally, a gambler, so the gamble is not unusual. Some might prefer that Dish Network create a new network and get into the mobile market. 

Some might argue Dish Network will launch a bid to buy all or at least majority control of T-Mobile US. Others think Dish Network does not have the capital or borrowing power to do that.

Many have suggested Dish Network could lease network facilities from Sprint, for example, rapidly gaining the network infrastructure it requires.

Beyond all that, there is the question of business model. Would Dish Network have much success competing as a traditional mobile service provider? Or must it gamble on creating a whole network primarily to deliver mobile video entertainment? And, if so, does the business model work?

Dish Network's most-recent spectrum winnings do not settle the matter, one way or the other.
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