The US Federal Communications Commission announced payments totaling $6.1 billion to satellite operators Eutelsat and SES for freeing up C-band spectrum.
SES will receive about $5.6 billion, while Eutelsat expects around $504 million in incentives to vacate parts of this valuable spectrum.
This follows a similar payout in 2020 when satellite companies earned $9.7 billion for clearing C-band frequencies, mainly benefiting SES and Intelsat.
The FCC finalized a new auction framework for 160 MHz of upper C-band spectrum just days before this announcement, setting deadlines for spectrum relocation by 2030 and 2031.
Both companies are obligated to maintain uninterrupted satellite services during this transition, with additional reimbursements covering relocation expenses.
Following the news, SES shares jumped roughly 8% in premarket trading, reflecting investor optimism about the capital influx.
C-band is critical for 5G networks in the US because it offers a balance between coverage and data speed, making it highly sought after by mobile operators expanding their infrastructure.
Meanwhile, SES has been growing its medium earth orbit constellation, and Eutelsat gained access to low earth orbit assets through its 2023 merger with OneWeb, signaling a strategic shift in the satellite industry.
The key challenge ahead lies in meeting the FCC's relocation deadlines while preserving service quality, as missing these could threaten parts of the payment.
This material is for informational purposes and does not constitute financial advice.
