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PARIS – EchoStar is looking for ways to expand its communications business as an “asset-light growth company,” CEO Hamid Akhavan said Sept. 15, after regulatory pressure prompted a series of spectrum sales in what he called a “forced pivot.”
During a press conference here at World Space Business Week, Akhavan said: “You will see us expand our aperture now that we have additional capital at hand and additional opportunities to deploy our resources.”
Despite abandoning plans to deploy a low Earth orbit direct-to-device (D2D) constellation, EchoStar intends to stay focused on satellite connectivity and communications.
“We won’t give up any of that heritage, but we’ll expand on that,” Akhavan said.
Reshaping EchoStar
The divestments followed Federal Communications Commission investigations into whether EchoStar was underutilizing its spectrum holdings, probes launched after filings from SpaceX and others.
Even if the geostationary operator could prove that it was complying with FCC obligations, it risked “winning the battle but losing the war,” EchoStar cofounder and chairman Charlie Ergen said, since the investigations that have since been dropped would have prevented it from moving forward with the D2D business.
“So how do you build a network?” Ergen asked. “How do you get return to shareholders when you don’t know how long the proceedings will take in court?”
Prior to the recent spectrum sales, EchoStar had about $4.3 billion in cash. Once the transactions close, EchoStar will have about $24 billion in cash and $13 billion in debt, Akhavan said.
SpaceX stake and services
Through the multibillion-dollar deal with SpaceX announced Sept. 8, EchoStar also obtained SpaceX stock and access to Starlink D2D services for its terrestrial wireless service Boost Mobile.
Ergen said: “If I could make one investment other than ourselves, it would be in SpaceX, because they’ve got 90% of the launch capability in the world today and I think that lead will grow with the Starship.
“They have a manufacturing capability that’s highly automated and built from the ground floor up.”
Prior to the SpaceX deal, EchoStar announced the sale of 600-MHz spectrum to AT&T and ordered 100 satellites from Canada’s MDA Space.
EchoStar will continue to offer communications equipment through Hughes Network Services and to provide entertainment and mobile services through brands Dish Network, Boost Mobile and Sling TV.
The company is also still using S-band frequencies sold to SpaceX to provide connectivity to lightweight terminals with a geostationary satellite over Europe.
Speaking on a separate WSBW panel Sept. 15, EchoStar chief operating officer Paul Gaske said “we’re hopeful to maintain service there for the time being with the customers we have,” as the future of that spacecraft remains undetermined following the SpaceX deal.
SpaceNews Head of Business Intelligence and Senior Staff Writer Jason Rainbow contributed to this article from Tampa, Florida
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