Spectrum Deal Helps Dish Shares

Comcast and Time Warner Cable may make a hefty profit in their plan to
sell 122 wireless communications licenses to Verizon Communications, but
the agreement may have another unintended beneficiary -- Dish Network.

shares climbed as much as 7.6% ($1.80 each) to $26.45 per share, in
early trading Friday and were priced at $26.03 each (up $1.45, or 6%) by
the afternoon.
Comcast and Time Warner Cable shares were up about 4% each in afternoon trading Friday, after they announced
their SpectrumCo consortium (which also includes Bright House Networks)
agreed to sell its wireless spectrum licenses  to Verizon for $3.6
billion. The deal represents a 64% premium to the price SpectrumCo originally paid for the licenses in 2006.

Dish Network has been on a spectrum acquisition tear
in the past year, spending nearly $3 billion to acquire 40 Megahertz of
wireless spectrum from two bankrupt providers. In light of SpectrumCo
deal, those assets have substantially increased in value.

Wells Fargo
cable and satellite analyst Marci Ryvicker said in a research note
Friday that the SpectrumCo deal means that Dish's spectrum is worth
about $10 billion, or $22 per share. That, she noted, is clearly not
included in Dish's current trading price.

Dish has also become
increasingly more attractive as an acquisition target, according to some
analysts, especially in the wake of the troubled AT&T/T-Mobile
deal. AT&T announced in March that
it would acquire T-Mobile for $39 billion, a deal that was made mainly
to combine spectrum assets. But that deal has hit several regulatory snags.
In a research report Friday, Sanford Bernstein cable and satellite
analyst Craig Moffett said that although the SpectrumCo deal removes
Verizon from the list of potential suitors for Dish, others could step
to the plate.

"Dish, for example, would now seem a more likely
partner for T-Mobile, which will be even more desperately in need of
spectrum if the AT&T deal crumbles, and Dish could potentially be a
logical partner for AT&T as well," Moffett wrote.

ISI Media Group analyst Vijay Jayant said the deal highlights the value of the Dish assets.

"There's clearly a thirst for spectrum on the part of the wireless carriers," Jayant wrote.