Satellite TV companies shockingly withdrew from the FCC's Auction 66 last week in order to focus their attention on emerging wireless technologies, like WiMAX and ATC. Rival satellite TV operators
EchoStar Communications and DirecTV paid a massive $1 billion deposit in the Auction 66 bid market for radio spectrum, then abruptly withdrew about 10 days ago. Those companies were believed to be in
the hunt for airwaves to help them expand into wireless communications and step up their competition with Comcast and mobile carriers like Verizon. So why did they back out? Turns out that EchoStar
and DirecTV have a better plan: Enter the mobile communications market by using a different technology, WiMAX, which covers large areas with high-speed wireless Internet access. WiMAX is the
brainchild of chipmaker Intel Corp and a startup called Clearwire, which Intel and others recently pumped $900 million into. Thus far, WiMAX penetration is small; Clearwire provides service to some
90,000 subscribers in small cities in Oregon, California, and Texas. Currently, Clearwire is in the late stages of completing a deal with a major mobile virtual network operator. It would provide the
company with a nationwide network that would help build up its Internet services base until the higher-speed WiMAX technology is completed. Access to a state-of-the-art wireless technology would help
EchoStar and DirecTV start competing with cable companies and telecom providers.
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