EchoStar has announced it will not make an approximately $326 million cash interest payment due on May 30, 2025, citing uncertainty over its spectrum rights. The company’s decision comes as the Federal Communications Commission (FCC) launches a review of EchoStar’s compliance with federal obligations to provide 5G service nationwide.
EchoStar’s CEO Charlie Ergen, who oversees both the company and Boost Mobile, expressed concerns about the lack of clarity on the company’s spectrum rights. This uncertainty has hindered its ability to make decisions regarding its Boost business and network buildout plans.
The FCC’s review, led by Chairman Brendan Carr, may have implications for EchoStar’s future. Analysts at New Street Research suggest that the company may be using this situation to pressure the FCC into revising policies on spectrum allocation and development of Open RAN (O-RAN) technology.
EchoStar acquired Boost Mobile as part of its ownership of Dish Network and has since been working to develop a 5G network. The company has positioned its O-RAN technology as a key aspect of its success, but its financial situation remains uncertain.
The FCC’s review is the latest development in a long-standing dispute between EchoStar and the agency. In 2014, Dish Network was involved in a dispute with the FCC over the allocation of AWS-3 spectrum licenses, which has since become relevant again due to the current review.
EchoStar’s decision not to make the interest payment raises questions about its ability to navigate the complex regulatory landscape and may lead to further action, including the possibility of filing for Chapter 11 bankruptcy protection.
Source: https://www.lightreading.com/open-ran/echostar-could-threaten-bankruptcy-over-fcc-inquiry