Dish Network 2015 Annual Report Download - page 26

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acquired, among other things, certain satellite assets and wireless spectrum licenses held by DBSD North America and
TerreStar. The total consideration to acquire the DBSD North America and TerreStar assets was approximately $2.860
billion.
On February 15, 2013, the FCC issued an order, which became effective on March 7, 2013, modifying our licenses to
expand our terrestrial operating authority with AWS-4 authority (“AWS-4”). That order imposed certain limitations on
the use of a portion of this spectrum, including interference protections for other spectrum users and power and emission
limits that we presently believe could render 5 MHz of our uplink spectrum (2000-2005 MHz) effectively unusable for
terrestrial services and limit our ability to fully utilize the remaining 15 MHz of our uplink spectrum (2005-2020 MHz)
for terrestrial services. These limitations could, among other things, impact the ongoing development of technical
standards associated with our wireless business, and may have a material adverse effect on our ability to commercialize
our AWS-4 licenses. That order also mandated certain interim and final build-out requirements for the licenses. By
March 2017, we must provide terrestrial signal coverage and offer terrestrial service to at least 40% of the aggregate
population represented by all of the areas covered by the licenses (the “AWS-4 Interim Build-Out Requirement”). By
March 2020, we were required to provide terrestrial signal coverage and offer terrestrial service to at least 70% of the
population in each area covered by an individual license (the “AWS-4 Final Build-Out Requirement”).
On December 20, 2013, the FCC issued a further order that, among other things, extended the AWS-4 Final Build-Out
Requirement by one year to March 2021 (the “Modified AWS-4 Final Build-Out Requirement”). If we fail to meet the
AWS-4 Interim Build-Out Requirement, the Modified AWS-4 Final Build-Out Requirement may be accelerated by one
year, from March 2021 to March 2020. If we fail to meet the Modified AWS-4 Final Build-Out Requirement, our
terrestrial authorization for each license area in which we fail to meet the requirement may terminate. The FCC’s
December 20, 2013 order also conditionally waived certain FCC rules for our AWS-4 licenses to allow us to repurpose
all 20 MHz of our uplink spectrum (2000-2020 MHz) for downlink (the “AWS-4 Downlink Waiver”). If we fail to
notify the FCC that we intend to use our uplink spectrum for downlink by June 20, 2016, the AWS-4 Downlink Waiver
will terminate, and the Modified AWS-4 Final Build-Out Requirement will revert back to the AWS-4 Final Build-Out
Requirement.
H Block Licenses. On April 29, 2014, the FCC issued an order granting our application to acquire all 176 wireless
spectrum licenses in the H Block auction. We paid approximately $1.672 billion to acquire these H Block licenses,
including clearance costs associated with the lower H Block spectrum. The H Block licenses are subject to certain
interim and final build-out requirements. By April 2018, we must provide reliable signal coverage and offer service to at
least 40% of the population in each area covered by an individual H Block license (the “H Block Interim Build-Out
Requirement”). By April 2024, we must provide reliable signal coverage and offer service to at least 75% of the
population in each area covered by an individual H Block license (the “H Block Final Build-Out Requirement”). If we
fail to meet the H Block Interim Build-Out Requirement, the H Block license term and the H Block Final Build-Out
Requirement may be accelerated by two years (from April 2024 to April 2022) for each H Block license area in which
we fail to meet the requirement. If we fail to meet the H Block Final Build-Out Requirement, our authorization for each
H Block license area in which we fail to meet the requirement may terminate. The FCC has adopted rules for the
H Block spectrum band that is adjacent to our AWS-4 licenses. Depending on the outcome of the standard-setting
process for the H Block and our ultimate decision regarding the AWS-4 Downlink Waiver, the rules that the FCC
adopted for the H Block could further impact 15 MHz of our AWS-4 uplink spectrum (2005-2020 MHz), which may
have a material adverse effect on our ability to commercialize the AWS-4 licenses.
DISH Network Non-Controlling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless
Spectrum Licenses
Through our wholly-owned subsidiaries American II and American III, we have made over $10.0 billion in certain non-
controlling investments in Northstar Spectrum, the parent company of Northstar Wireless, and in SNR HoldCo, the
parent company of SNR Wireless, respectively. On October 27, 2015, the FCC granted certain AWS-3 Licenses to
Northstar Wireless and to SNR Wireless, respectively, which are recorded in “FCC authorizations” on our Consolidated
Balance Sheets. The AWS-3 Licenses are subject to certain interim and final build-out requirements. By October 2021,
Northstar Wireless and SNR Wireless must provide reliable signal coverage and offer service to at least 40% of the
population in each area covered by an individual AWS-3 License (the “AWS-3 Interim Build-Out Requirement”). By