Straight Path Communications has agreed to pay more than $100 million to settle an investigation into its failure to deploy wireless service as required by its spectrum license and will sell or surrender all its 5G licenses, according to the FCC.
The company will surrender 196 of its 1,000 39 GHz licenses, sell the rest, and give the FCC 20% of the proceeds from that sale.
"Squatting on spectrum licenses without any meaningful effort to put them to good use in a timely manner is fundamentally inconsistent with the public good,” said Travis LeBlanc, chief of the FCC’s Enforcement Bureau, in announcing the settlement. “Wireless spectrum is a scarce public resource. We expect every person or company that receives a spectrum license to put it to productive use.”
Straight Path will have to pay $15 million up front but won't have to pay the other $85 million if it either sells the balance of the licenses within 12 months or surrenders them. The 20% of the sale price is an additional penalty.
Straight Path called it a "comprehensive settlement" that has "cleared the way for a review of strategic alternatives to maximize shareholder value," said CEO Davidi Jonas, which means selling the licenses. It has retained Evercore to advise it on the sale.
“We are pleased that we were able to achieve a comprehensive settlement with the FCC, which allows us to move forward as the largest holder of 39 GHz spectrum, with about 95 percent of the total licenses commercially available at this time, as well as a significant holder of 28 GHz in major markets, including New York and San Francisco," said Jonas.
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