Dish Network is reportedly in talks to merge with T-Mobile US, a deal that would give T-Mobile what it has been looking for: more spectrum.

Dish, a satellite TV provider, has been buying up spectrum licenses for years but has not yet used its airwaves to offer cellular service. Dish and T-Mobile (owned by Deutsche Telekom) "are in close agreement about what the combined company would look like, with Dish Chief Executive Charlie Ergen becoming the company’s chairman and his T-Mobile counterpart, John Legere, serving as the combined company’s CEO," The Wall Street Journal reported last night , citing people familiar with the matter. "Tougher questions about a purchase price and the mix of cash and stock that would be used to pay for a deal remain unresolved, the people said. One of the people characterized the talks as at 'the formative stage,' and said an agreement might not ultimately be hammered out."

Dish has almost as much spectrum as T-Mobile, and combined, the companies would have more than either AT&T or Verizon, according to a report last month by Recon Analytics. The total amount of spectrum isn't necessarily as important as the type of spectrum, as evidenced by the fact that Sprint has more than market leaders AT&T and Verizon.

But Dish's holdings could fill a gap in T-Mobile's portfolio. While T-Mobile has complained that the top two carriers control the lion's share of low-band spectrum—ideal for covering long distances and penetrating walls—Dish owns low-band licenses in the lower 700MHz range. T-Mobile owns some 700MHz licenses as well but says it needs more low-band airwaves.

Dish controversially boosted its spectrum holdings again this year by using subsidiaries to claim a small business discount at an auction. The Federal Communications Commission is reportedly considering whether to reject Dish's discounts and force the company to pay full price or lose the licenses.

The FCC is planning an auction of 600MHz frequencies held by TV broadcasters and intends to impose restrictions that limit how much the biggest carriers can buy. Sprint, T-Mobile, and Dish are pressuring the FCC to set aside even more spectrum for the smaller carriers, to the chagrin of Verizon, which published this handy chart showing what Dish has done with the spectrum it already has:

Dish and T-Mobile have declined to comment on their possible merger. While regulators forced both AT&T and then Sprint to abandon bids to buy T-Mobile, a Dish/T-Mobile combination might not face as much opposition because it would preserve the current situation of four major nationwide carriers.

While a merger would boost T-Mobile's network capacity, it makes sense for Dish, too. "Dish lacks the robust broadband Internet service that cable companies can lean on to offset a declining TV business," the Journal wrote. "It also has amassed billions of dollars of wireless licenses but hasn’t built the cellular network needed to put them to use. T-Mobile’s wireless service would help address both needs."