FCC Move Lets Satellite TV Players Offer Mobile Service

The U.S. Federal Communications Commission allocated new spectrum for wireless transmissions, which should immediately benefit satellite TV companies but could benefit most mobile carriers over time.

The move came after years of complaints by the top mobile carriers headed by AT&T Inc. (NYSE:T), which tried to acquire T-Mobile USA in a $39 billion deal that collapsed last year. As a consequence, Dallas-based AT&T had to pay T-Mobile a $3 billion breakup fee and provide another $1 billion worth of spectrum service.

The FCC voted 5-0 late Tuesday.

“These actions will help meet skyrocketing consumer demand and promote private investment, innovation and competition, while unlocking billions of dollars in value,” it announced.

FCC Chairman Julius Genachowski and the other commissioners testified Wednesday before the House Energy and Commerce Committee that a final order will come soon to free up more space in the 40 Mhz band for mobile use, specifically for constructing 4G long-term evolution (LTE) networks, which are most desirable for smartphones and tablets.

The FCC also said it will conduct another auction of wireless spectrum next year.

The news sent shares of most telecommunications companies up sharply Wednesday, with special bumps for Clearwire (NASDAQ:CLWR), the 4G national data carrier now controlled by Sprint Nextel Corp. (NYSE:S), of Overland Park, Kan., as well as Dish Network Corp. (NASDAQ:DISH), the Englewood, Colo., satellite TV provider that wants to offer mobile phone service.

Clearwire and Dish shares jumped more than 3 percent, putting their prices just below their 52-week highs.

Dish, controlled by satellite pioneer Charlie Ergen, will be free to start its own mobile service or partner with a conventional carrier in offering service, much like its cable rivals headed by Comcast Corp. (NASDAQ:CMSA) offer phone and Internet services along with TV.

Ergen has been known as a dealmaker who's also acquired many companies in the past, including the remaining assets of defunct Blockbuster last year.

The FCC said it had removed “barriers that limited this spectrum to satellite use,” which also opens up mobile service to other satellite providers, such as News Corp. (NYSE:NWS).