The Federal Communications Commission announced on Monday that it will publicly auction off a valuable telecommunications asset, in a move investors viewed as a blow to U.S. satellite communications provider Intelsat. fcc 5g

Shares of Intelsat dropped 40% in heavy trading volume after FCC Chairman Ajit Pai said in a tweet that his agency “must free up significant spectrum” for 5G telecommunications. The FCC told CNBC that it expects an auction to happen “before the end of 2020.”

C-band spectrum is a key telecommunications wavelength the FCC regulates. Four satellite operators, including Intelsat, provide C-band services in the U.S. to about 120 million households. The FCC wants to repurpose the C-band spectrum for 5G and an auction is expected to raise tens of billions of dollars. But a public auction would see the proceeds go to the government, an option the satellite operators – organized as the C-Band Alliance – have opposed.

“The fundamental issue here is that there’s the ideal and there’s the practical. Everyone recognizes the best use of this spectrum is for 5G services – but what is the most economical and timely way to do that?” Chris Quilty, president of satellite financial services firm Quilty Analytics, told CNBC. Quilty formerly led Raymond James’ coverage of satellite communications and the broader space industry for 20 years.

Intelsat had a market value of about $1.8 billion before trading began on Monday. Even before the latest drop, Intelsat’s stock had declined more than 10% on three consecutive trading days as the tide shifted against the C-Band Alliance. The FCC’s announcement of a public auction means the satellite companies may not recoup the value of their C-Band investments, such as the expensive satellites.

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