Charlie Ergen’s Spectacular Triple Play

Terrestar Networks is nearing a minimum bid agreement of $1.2 billion to $1.4 billion, likely with billionaire Charlie Ergen, chairman of Dish Networks, reports Reuters.

Ergen, who also controls EchoStar, has been competing against other interested bidders, including a group of senior noteholders and wireless communications company MetroPCS, sources said.

Charlie Ergen’s Dish Network is the apparent winner to buy TerreStar Networks, with a $1.375 billion cash bid. This March, Dish also agreed to pay $1.4 billion for satellite provider ICO/DBSD, a similar bankrupt satphone company sharing the same 2 GHz MSS band as TerreStar.

Ergen now seems positioned to combine Terrestar and ICO/DBSD. That would give Ergen control of 40 MHz of spectrum and two huge space platforms for satellite phone service. Echostar also recently purchased assets from Hughes to provide satellite internet access.

It appears to be a spectacular triple play for Charlie Ergen!

Terrestar, the still-born, spot-beam satellite phone network, planned to use the 2 GHz band in conjunction with terrestrial repeaters. On July 20, 2009 TerreStar completed the first end-to-end satellite-terrestrial phone call over TerreStar-1. In October, 2010, it declared bankruptcy. ICO G1 was successfully launched on April 14, 2008. G1 is now station keeping at 92.85 degrees West. Waiting for customers.

Terrestar controls 20 Mhz in the 2 GHz band. The TerreStar-1 satellite, constructed by Space Systems/Loral, was the world’s largest and most powerful commercial satellite when it launched on July 14, 2009 and successfully deployed its 18 meter 2GHz S Band reflector.

ICO was the first to launch a spot-beam satellite in the 2 GHz MSS band in 2008. It declared bankrupcy even before offering services. Echostar has apparently grabbed up both, wrestling ownership away from Harbinger.

The FCC approved the creation of Mobile Satellite Service (MSS) networks in the 2.0 and 2.2 GHz band, in connection with Ancillary Terrestrial Components (ATC). The thinking behind ATC was that satphone companies needed help in penetrating cars and buildings. Terrestrial repeaters were authorized by the FCC in order to promote competition and improve service. The concept of ATC is similar to satellite radio providers that use terrestrial repeaters. It provides a signal boost.

LightSquared will be using part of the L-band downlink frequencies in the 1525-1559 MHz band, but GPS (and GLONASS) operates in the adjacent 1559-1610 MHz band. Most GPS devices don’t have strict filtering at the bottom of the GPS band and therefore could be overwhelmed by the high-power transmissions coming from LightSquared’s terrestrial transmissions, say skeptics.

A final report that LightSquared and a GPS industry group will deliver today to the FCC will show that LightSquared’s proposed terrestrial network for wholesale LTE will cause interference with GPS receivers, reports Bloomberg.

Harbinger, which is financing Lightsquared and also owns a minority share in TerreStar, may have planned a 2GHz first strategy, in an attempt to head off the findings of today’s GPS Working Group report to the FCC. However, once again Harbinger may now have been thwarted by DISH, says TMF Associates.

Dish has been an active bidder in bankruptcies, winning an auction for Blockbuster’s assets in April and ICO (now known as DBSD North America), in March. Dish reached an agreement to acquire the equity of DBSD North America for $1.4 billion, once DBSD emerges from bankruptcy protection. EchoStar also closed a $2B Hughes Deal for broadband satellite access.

Harbinger may now need a Sprint connection more than ever. A 2.6 GHz LTE system wouldn’t pose a GPS interference problem. But without terrestrial use of 1.6 GHz LTE, Lightsquared’s $300 million satellite platform doesn’t seem as valuable as it once did.

The satellite was always something of a Trojan Horse for Harbinger. The FCC, in hindsight, should have anticipated the interference issue.

Related DailyWireless Space and Satellite News includes; EchoStar Closes $2B Hughes Deal, Lightsquared Interference: No Immediate Fix?, LightSquared: GPS Interference Found, Lightsquared: Plan B from Outer Space?, Harbinger: 59MHz or What?. Time Warner Cable + Lightstream?, Lightsquared Signs Cricket Wireless, Another Rumor: Lightsquared + Sprint?, Lightsquared + Sprint?, Charlie’s Big Play, LTE Spectrum: It’s War, Lightsquared: What GPS Interference?, Harbinger Sells Inmarsat Shares, FCC Green Lights Lightsquared, T-Mobile: No Spectrum Deal…Yet, LightSquared: In Trouble?, Lightsquared Unfurled, MetroPCS Eyes TerreStar, SkyTerra 1 Launched, ICO Deploys 40 Foot Antenna, ICO G-1 In Space, ICO Wants Its Mobile TV – via DVB-SH, Broadband Satellites: Black Hole?, MSS: Stuck in Space, Satellite with 328 ft Antenna to Launch, Broadband Satellites: Black Hole?, LightSquared: Phase 1, LightSquared: 5K Basestations by 2011, LightSquared Announces LTE Network, FCC Okays Terrestrial LTE for SkyTerra, TerreStar Successfully Launched, AT&T/TerreStar Ready Satphone Service, TerreStar Phones Home, Godzilla SatPhones WiMAXed

Posted by Sam Churchill on .

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