Satellite television provider Dish Network today offered $25.5 billion for Sprint Nextel Corp., in an unsolicited bid that surprised the wireless industry.

The bid, announced by CEO Charles Ergen, is $5.5 billion higher than that offered by Japan’s Softbank, which already had a pending deal to take a 70 percent stake in the third largest wireless carrier.

The bidding may not yet be over if Softbank decides to counter with a higher offer or if other bidders emerge in the coming weeks.

Ergen has signaled his interest in entering wireless markets to compensate for slowing earnings in the satellite television business.

“He is trying to transform his own business,” Vijay Jayant, an analyst at International Strategy & Investment Group in New York told Bloomberg News. “He’s trying to reinvent himself, moving from satellite to wireless.”

Ergen’s vision would include a bundled package of satellite television, broadband wireless Internet and cellular telephone service. Providing suitable wireless broadband Internet in rural areas may be the biggest challenge because of Sprint’s more limited network coverage, but a marketing deal combining satellite television from Dish and Sprint cell phone service would be easier to carry out.

Ergen’s offer includes $8.2 billion in stock and $17.3 billion in cash. Ergen’s company has stockpiled at least $10 billion from selling bonds over the last year. He intends to borrow the rest.

Ergen earlier had attempted to disrupt a deal that would have consolidated Clearwire into Sprint. Ergen offered $3.30 a share for Clearwire, 33 cents higher than the $2.97 per share offer from Sprint. Ergen also reportedly approached both MetroPCS and Deutsche Telekom’s T-Mobile USA looking for a deal to no avail.

Some analysts question whether Ergen has enough experience to manage a major wireless company with only his past involvement selling satellite TV subscriptions. But he arrives with more than just cash and stock options. Ergen has acquired mobile spectrum from bankrupt TerreStar Networks and DBSD North America. Ergen says he has no interest in building his own wireless network, but a combined Sprint/Dish could manage the spectrum through Sprint’s existing operations.

Ergen told Bloomberg News combining the spectrum Dish owns with the spectrum owned by Sprint and Clearwire would assure Americans of a robust wireless data platform that will not have capacity constraints or require individual device fees. That is in keeping with Sprint’s existing marketing as a provider of truly unlimited wireless data plans.

Several Wall Street analysts told CNBC and Bloomberg News the deal with Softbank may be more ideal for shareholders and consumers, because it would strengthen Sprint’s leverage with equipment manufacturers to offer cheaper and more robust devices.

Consumer advocates have mixed feelings. Dish has no prior association to the wireless industry so the deal does not represent direct, competitive consolidation. It also would boost Sprint as a more formidable competitor to AT&T and Verizon Wireless. But it could also further orphan T-Mobile USA.

“Right now, we have two giants and two also-rans, and now you’re getting potentially three giants dividing up the American market place, with T-Mobile lagging far behind,” Susan Crawford told the New York Times.

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Bloomberg News explores what Dish sees in Sprint that is worth a bid of $25.5 billion to acquire the country’s third largest mobile company.  (2 minutes)

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Bloomberg says Dish has been stockpiling $10 billion in cash for new acquisitions to transform its business away from a satellite TV-only company.  (2 minutes)

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Christopher Marangi, of Gabelli Asset Fund talks with Bloomberg’s Erik Schatzker about Dish Network’s unsolicited $25.5 billion offer for Sprint and what options are available to Sprint with the offers it has on the table. (2 minutes)

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Jonathan Chaplin, an analyst with New Street Research LLP, thinks Softbank’s original offer is superior to the one from Dish.  (6 minutes)

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Jennifer Fritzsche, Managing Director of Equity Research at Wells Fargo Securities, discusses the likelihood of other players making bids. (2 minutes)

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A Bloomberg News reporter interviewed Charlie Ergen about why he wants to enter the wireless business.  Ergen’s vision includes no nickel and diming customers with monthly device fees and usage charges. (4 minutes)

Canada’s effort to expand mobile competition has likely failed with news that three of the most significant new independent entrants have put themselves up for sale, with one likely to be acquired by Telus, western Canada’s largest phone company.

With Bell Canada, Rogers Communications, and Telus dominating at least 90 percent of Canada’s wireless marketplace, breaking up the triopoly was unlikely to be easy, but three of Canada’s newest players that acquired spectrum just five years ago are already looking for exit strategies.

Bloomberg News reported Friday that Mobilicity is in talks to be imminently acquired by Telus for between $350-400 million. Public Mobile has hired investment bankers to find a buyer. Vimpelcom, Ltd., which owns Wind Mobile, announced it was “exploring its options, including divestment.”

The three companies have competed with the dominant players for about three years with little success. Combined, the three have not managed to achieve even a combined 10 percent market share. Most sell unlimited talk and text plans to customers that would normally buy prepaid service.

Potentially slowing any sale is a requirement that none of the independent companies can transfer their spectrum licenses until 2014, a condition of the 2008 special spectrum auction that reserved prime frequencies for new competitors and put them off-limits to larger mobile companies.

Telus remains the most likely suitor of independent providers because the company lacks the spectrum assets of its larger competitors Bell and Rogers.

Mobilicity operates its HSPA+ “4G” network on Advanced Wireless Services (AWS) frequencies in the 1,700MHz range. Although Telus has considerable spectrum in British Columbia and Alberta — its home territory — the provider has considerably less in eastern Canada, particularly in large metropolitan cities. Mobilicity has a tiny market share in the Greater Toronto Area, yet its AWS spectrum equals that of Telus in the city. Telus could find an acquisition of Mobilicity the easiest way to bolster its available spectrum for future 4G deployment and expansion.

Three small independent wireless providers hold almost as much combined spectrum as Telus holds today.

Any exit of a combination of Canada’s newest wireless players will likely be seen as a failure of the government’s efforts to bolster competition. The dominance among the three largest providers has left Canadians with high-cost plans and a wireless service contract that lasts one year longer than America’s standard two-year service agreement.

Industry Canada, the economic regulator fostering a growing, competitive and knowledge-based Canadian economy, had little to say about the news.

“Any transaction that requires regulatory approval will be considered accordingly,” said Alexandra Fortier, a spokeswoman for Industry Minister Christian Paradis. “We cannot comment on speculation.”

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BNN reports industry consolidation is likely forthcoming in Canada’s wireless marketplace as Telus seeks to acquire independent provider Mobilicity. A financial analyst says the move is designed to curb budget-priced wireless service in Canada. Mobilicity would likely eventually be merged into Telus-owned Koodo Mobile, the company’s prepaid mobile division.  (5 minutes)

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Too little, too late? Industry Minister Christian Paradis says the Harper government wants to open up the wireless market to more players with another wireless spectrum auction. But now several of Canada’s newest independent providers are all up for sale, and the country’s dominant three may end up owning one or more of them.  (2 minutes)

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The Toronto Globe & Mail explores why Canadians hate their cell phone and mobile broadband providers so much.  (2 minutes)

West Virginia’s broadband future is up for hot debate in the state legislature as Internet haves and have nots fight over whether the state should spend money to bring broadband to those lacking it or improve service for those that do.

House Bill 2979, a bill to expand the broadband purview of the West Virginia Infrastructure and Jobs Development Council, has turned into one of the most contentious bills before the legislature this term. An amendment to redefine what speeds represent “broadband” and requiring the council to prioritize efforts on unserved areas has sparked the most debate.

Sen. Robert Plymale (D-Cabell) introduced and won support for an amendment that would discard the current provider-favored standard defining a community as “served” if customers can buy at least 200kbps service. Plymale favors adopting the federal broadband speed standard — 4/1Mbps as the bare minimum. Plymale also wants the state to devote most of its resources to getting broadband to rural areas that do not have the service today.

“If you’re going to compete in this world today, you have to have access,” Plymale told lawmakers. “Access has to be the number one item, and this amendment allows access to be the priority.”

Plymale

But other lawmakers representing constituents in communities that already have broadband, but receive inadequate speed and service, objected to Plymale’s amendment.

Sen. Herb Snyder (D-Jefferson) claims Plymale’s amendment would restrict the council’s ability to manage broadband resources and require it to spend most of its funding on wiring smaller communities at the cost of service upgrades that could reach more people. Approximately 85,000 West Virginians still have no broadband access other than satellite.

“It’s entirely appropriate to use taxpayer dollars to help and assist people to get broadband service and get on the information superhighway rather than upgrading those already on it,” argued Sen. Mitch Carmichael (R-Jackson), who also happens to also be an employee of Frontier Communications.

Much of the state’s broadband infrastructure spending has been devoted to institutional and middle mile networks that consumers and small businesses cannot directly access. Spending on “last mile” infrastructure makes the difference between getting broadband service or being told it is unavailable.

But Sen. Snyder argues satellite broadband already offers access to the entire state, so broadband speed improvements were more important.

“As we speak the entirety of West Virginia is bathed in 5Mbps satellite broadband service,” Snyder said. “So we’re already surpassing that standard in the entire state, unless you’re in a cave where you can’t get the signal.”

Getting the best broadband bang for the buck was a priority for Sen. Clark Barnes (R-Randolph). He wanted to make sure any amendment would not prevent the council from spending money in areas where satellite service was available.

“If we have 10 folks up in Possum Hollow that have no access to broadband, would they receive priority over the thousand people who only have 2Mbps service?” he said.

The answer would seem to be yes under Plymale’s amendment.

The Federal Communications Commission has opened the door for Time Warner Cable to raise basic cable rates in several parts of Ohio and California after ruling the company faces effective competition from Dish Networks and DirecTV.

Under FCC rules cable rates for the broadcast basic tier, which includes local television stations and a handful of basic cable networks, remain regulated by the government until a cable operator can prove at least 50 percent of their service area is covered by a competing provider and 15 percent of its would-be customers are signed up with a competitor.

Cable companies have requested rate deregulation in countless communities as satellite and television service from phone companies penetrates their markets. Once rates are deregulated, cable operators can raise them to whatever price they believe the marketplace will bear.

In several affected communities, Time Warner Cable’s service is so uncompelling, almost half of the households have signed up for satellite service instead.

The communities affected in Ohio:

• City of Bellefontaine
• Howard Township
• Village of Huntsville
• Village of Lakeview
• McArthur Township
• North Bloomfield Township
• Village of Russells Point
• Stokes Township
• Washington Township
• Village of Zanesville

In California:

• Bradford

Shaw Communications has acquired Calgary’s largest fiber optic cable network in a $225 million deal with ENMAX Corp. in a bid to strengthen its ability to serve large corporate customers who need more bandwidth than Shaw is now positioned to offer.

ENMAX sells its Envision fiber service to large corporate clients in and around downtown Calgary and to those businesses that need dedicated connectivity across multiple offices. The acquisition will further enhance Shaw’s dominance in Calgary. Shaw remains western Canada’s largest cable operator with an emphasis on serving Alberta and British Columbia.

Shaw’s business plan, revamped last year, is much closer to American cable operators than Rogers Communications — the dominant cable company in eastern Canada. Shaw abandoned its mobile ambitions and will stay out of the cellular business. In January, Shaw announced its intentions to sell its AWS wireless spectrum holding to Rogers.

Shaw has also ended efforts to expand eastward after announcing it would sell Mountain Cablevision, Ltd., which serves parts of Hamilton and the Niagara Region of Ontario, to Rogers.

In 2013, Shaw subscribers can expect to see a broadening of the company’s growing Wi-Fi network — available free of charge to its broadband customers, a major upgrade to its DreamGallery set-top box software interface, and the completion of plans to switch its cable television lineup to an all-digital format by the end of this year.