AT&T’s agreement to buy about 50 MHz of nationwide spectrum from EchoStar sets off a chain reaction that will likely reshape the communications industry, specifically an expansion into fixed wireless access (FWA) that will pressure competitors across broadband and satellite.
Under the $23 billion deal, AT&T will acquire about 30 MHz of nationwide 3.45 GHz mid-band spectrum and about 20 MHz of nationwide 600 MHz low-band spectrum.
The deal will put AT&T into a stronger position in cellular and broadband but will also have fallout effects for broadband, satellite communications (SATCOM) and cellular.
Stronger position
For AT&T, the fallout is obvious. The company will gain a significant amount of low- and mid-band spectrum that will allow it to expand its 5G and home broadband offerings.
AT&T CEO and chairman, John Stankey, said the assets will allow for the expansion of wireless and fiber internet as well as enhance coverage of 5G cellular infrastructure.
AT&T said the licenses cover 400 markets in total in the U.S. The company will deploy the mid-band licenses — which are compatible with its 5G network — as soon as regulatory approvals are met.
The deployment of the licenses will be undertaken in a multi-year capital investment starting in 2025.
FWA expansion
One of the major fallouts for AT&T is bolstering its fixed wireless access (FWA) broadband — also known as cellular home internet — options to more Americans. The mid-band spectrum will be used likely for FWA from AT&T, which it calls AT&T Internet Air (AIA), to reach more consumers.
This technology has been growing rapidly and response from consumers is incredibly popular, according to a recent survey from J.D. Power.
AT&T Internet Air currently serves about one million users and is seeing strong growth from consumers already. The company offers it up as a complement to its fiber broadband technology using 4G and 5G cellular instead of wired connections.
According to an AT&T spokesperson, part of its growth in AIA has been AT&T’s wireless network modernization efforts including the expansion of its mid-band spectrum. With the added spectrum from the EchoStar deal, the expansion of FWA services will be offered into even more regions.
“Our mission remains to connect as many Americans as possible to what matters most, utilizing a range of technologies including our industry-leading fiber network as well as AT&T Internet Air to deliver home internet,” the spokesperson said.
More broadband competition
As a result, AT&T’s spectrum buy will likely heat up the broadband race in America as it expands its FWA access to more users.
Rival telecoms Verizon and T-Mobile are already significantly invested in FWA. They, too, are also seeing a significant uptick in not just consumer satisfaction, according to the J.D. Power survey, but also seeing substantial growth in the technology.
All of this means that more competition is coming. For those doing fiber. For those doing cable. For those doing FWA.
That’s good news for consumers but potentially means revenue fallout for those who aren’t willing to compete or can’t compete against larger corporations.
Some analysts are already forecasting that AT&T will converge its wireless and home internet services in the form of bundles, especially where fiber isn’t yet deployed. This will no doubt put pressure on competitors Comcast and Cox as well as rival telecoms.
No fourth 5G telecom
EchoStar, which acquired DISH Network in late 2024, held spectrum licenses in the 2 GHz band and other frequencies. This came from its acquisition of Boost Mobile, which was offered as a stipulation of the T-Mobile/Sprint merger.
The company, which was seeing reduced users for its satellite TV technology due to streaming services/cord cutting, spent billions to acquire the spectrum with the long-term vision of deploying 5G networks and becoming America’s fourth cellular telecom.
However, costs to build such a network became overwhelming and the FCC put pressure on EchoStar to use the spectrum due to build-out obligations and under-utilization.
With EchoStar pinned between an expensive expansion into 5G and using the spectrum while getting additional pressures from satellite competitors SpaceX and VTel Wireless in the SATCOM space, EchoStar exited the cellular market.
With AT&T already planning to use the spectrum as part of its FWA strategy, it should appease the FCC.
For EchoStar, the company now can focus on its other businesses that include DISH Network, Sling, which has the popular SlingBox for streaming, and Hughes, a broadband internet service platform using SATCOM.
