EchoStar Skips Interest Payments Amid FCC Probe

EchoStar is currently facing significant financial challenges as it has opted to skip interest payments while simultaneously commissioning a new satellite for Dish TV. The company cites “uncertainty” stemming from an ongoing investigation by the Federal Communications Commission (FCC) as a primary reason for this decision.

Recently, EchoStar missed a crucial $183 million interest payment, as reported by the Wall Street Journal reported on Monday. This financial maneuver raises concerns about the company’s stability and could potentially lead to bankruptcy protection missed another $326 million interest payment, Bloomberg reported on Friday.

It’s potentially setting itself up for bankruptcy protection

Despite these financial setbacks, EchoStar continues to invest in its television business. The company has commissioned a new communications satellite, EchoStar XXVI, from Maxar Space Systems announced. This satellite is expected to be completed by 2028 and will enhance Dish TV coverage across all 50 U.S. states and Puerto Rico.

The FCC is currently evaluating whether EchoStar is meeting the necessary requirements to deploy 5G technology, which is essential for maintaining its spectrum licenses investigating. The merger of Dish Network with EchoStar, which also owns Boost Mobile, was aimed at strengthening their competitive position against major players like AT&T, Verizon, and T-Mobile compete in 5G. However, the ongoing FCC probe has reportedly led EchoStar to “freeze its decision-making” regarding Boost Mobile, according to the Wall Street Journal.

In addition to regulatory challenges, EchoStar faces competition from SpaceX, which is also vying for spectrum licenses in the 2 GHz band. Elon Musk’s company has conducted its own analysis of Dish’s cellular signals, describing EchoStar’s use of the gigahertz band as “de minimis at best” in an April submission to the FCC filing. In response, EchoStar accused SpaceX of engaging in a “land grab” for spectrum Wall Street Journal reported last month.

As of now, neither Dish Network nor EchoStar has provided a comment in response to inquiries from The Verge.