There’s a good reason why the U.S. government doesn’t want wireless spectrum treated like a passive asset to be pumped and dumped by investors. The airwaves are a scarce resource critical to American national security and economic competitiveness.
This is especially true in the context of the global space race. Spectrum is the lifeblood of satellite systems, and the Federal Communications Commission has clear rules to prevent using this spectrum merely as a tool for speculative investment, also known as “warehousing.”
Any megahertz that lies fallow is one that could be supporting a valuable service. Yet, recent developments risk setting a dangerous precedent — sit on your unused spectrum long enough, and you may see a multibillion-dollar payday.
Consider EchoStar, the parent company of Dish Network. The company recently collected $19 billion for largely unused satellite spectrum it obtained at a fraction of that price. Unlike spectrum for terrestrial wireless services such as 5G, the FCC is barred by law from auctioning satellite spectrum due to the international nature of satellite operations. The government’s approach rests on a simple bargain: companies get spectrum for free in exchange for actually using it promptly to provide services.
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But that bargain only works if companies deliver on their promises. After a public debate over EchoStar’s failure to meet buildout obligations, the FCC on May 9, 2025, announced a direct effort to investigate EchoStar’s compliance with 5G deployment requirements and the utilization of its mobile satellite service in the 2 GHz band. The FCC, after initially indicating it could reclaim the spectrum and possibly open it to competitive satellite and/or terrestrial users, opted to allow EchoStar to sell its spectrum licenses to SpaceX for $17 billion.
The FCC’s choice is understandable — at least now the spectrum will get used, and the agency can avoid possibly lengthy litigation. However, the moral hazard is obvious. As the Wall Street Journal editorial board noted, EchoStar “is being rewarded for warehousing spectrum.”
The potential for such a reward has not gone unnoticed. For years, speculators have attempted to flip satellite spectrum for profit — acquire for near-nothing, sell high. Case in point: Ligado Networks, a private equity-backed firm with satellite licenses.
Rather than invest in satellite services, Ligado sought to cash in on the 4G and 5G gold rushes by modifying its license for terrestrial use, then selling to wireless carriers. The problem? Their proposed network would interfere with critical government and commercial services such as GPS and satellite communications. A congressionally mandated study found the network unworkable.
With that exit strategy having failed, the company is now pursuing two new ways to pay off its debtors: sue the U.S. government for a whopping $39 billion and sell its spectrum to satellite operator AST SpaceMobile.
The FCC will be tempted to enable the sale. For nearly two decades, Ligado has largely squatted on its spectrum with a couple of ancient satellites and few customers. The company has used this spectrum to boost its valuation rather than invest in the deployment of actual satellite or terrestrial services. Allowing a sale to AST would, at least in theory, see the spectrum finally put to productive use.
But the ensuing precedent would possibly be even more dangerous than the one set by EchoStar. While EchoStar had a plausible intent to deploy services, Ligado’s strategy from its very inception seems to have been to flip its assets instead of serving customers or addressing the serious interference concerns.
If satellite spectrum were abundant, perhaps the government could afford to turn a blind eye to these long-running schemes. But spectrum-using industries are booming, and innovative startups are hungry for the spectrum licenses needed to power new services. This is particularly true in the MSS market. If the FCC enables Ligado’s payout from AST, the agency sends a message that only firms with the deep pockets to pay the warehouser’s ransom can participate in the space economy.
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Rather than rely on the secondary market alone to reapportion satellite spectrum, the FCC should keep a watchful eye on chronically underused spectrum and consider making it available to competitive users through processing rounds (which is the FCC’s way to allow multiple applicants to access satellite spectrum on a shared basis), as it has in the past. The Commission currently isn’t accepting applications for MSS spectrum, which inflates direct acquisition prices and incentivizes exactly the behavior that EchoStar and Ligado have exhibited. And the problem could spread. Omnispace has a priority S-Band position that is materially underutilized.
By making more spectrum available and clamping down on spectrum squatters, the FCC can ensure a vibrant, competitive space marketplace that avoids single points of failure and support America’s leadership in the space economy. To that end, the FCC should reject Ligado’s attempt at an undeserved windfall and instead allow all satellite operators to apply to use the spectrum.
Matthew Glavy is a retired U.S. Marine Corps Lieutenant General with over 39 years of military service. In addition to commanding US Marine Corps Cyberspace Command, he created and led the Corps’ Space Component Command.
