Ergen: Sprint’s Drop of T-Mobile Bid Increases Options

Dish Network Chief Says OTT Service On Track for Year-End Launch

Dish Network chairman Charlie Ergen said Sprint Corp.’s decision to abandon its pursuit of wireless carrier T-Mobile presents opportunities for his company, including a bid for T-Mobile itself or a partnership with the larger carrier.

Dish – which tried and failed to buy Sprint itself in 2012 – has a swath of wireless spectrum that it has been trying to develop into its own network, but has said it would not do so without a partner. On a conference call with analysts to discuss second quarter results, Ergen said in light of past events, Sprint could be that partner.

“We remain interested in working to enhance our overall business,” Ergen said. “That could include looking at a number of companies that are out there. Obviously the AT&T-DirecTV deal probably lessened some optionality we had. The Sprint announcement probably increased some optionality we had.”

Sprint, which has been widely expected to make a bid for T-Mobile, reportedly abandoned those plans because of concerns a deal would not pass regulatory muster. The combination would have reduced the number of major nationwide wireless carries in the country from four to three.

Dish has a swath of wireless spectrum it has accumulated through a series of acquisitions over the past several years. That spectrum could be worth even more in light of the upcoming federal AWS-3 wireless spectrum auction.

Ergen added that the auction will set a “baseline value” for Dish’s spectrum, but that it is more valuable that other frequencies because it can be used entirely as downlink spectrum. He argued that as wireless data and video demands increase, downlink spectrum will be the most desired.

While the AWS-3 wireless auction is set for mid-2015, Ergen added that Dish should be able to launch its over-the-top streaming video offering by the end of the year. Already the satellite company has secured streaming video rights with the Walt Disney Co. and A+E Networks. Ergen said the service will likely be a single stream into a home – customers will be able to watch shows on more than one device as long as everyone in the home is watching the same channel.

“Our strategic vision is to try to get incremental customers who aren’t pay TV subscribers today. We’d like to get them at a younger age,” Ergen said. “…My concern is today we’re missing that whole generation.”