Dish buys more customers as mobile push gets serious

Having shelled out massive sums for mobile spectrum over the years, Dish Network is now opening its wallet to pick up customers too.

The US satellite TV provider has announced the acquisition of mobile virtual network operator (MVNO) Republic Wireless for an undisclosed sum. The company – which Dish was keen to point out operates its service using T-Mobile’s network – has 200,000 customers, who will move to Dish on completion of the deal.

Subject to satisfaction of the usual closing conditions and regulatory approvals, Dish expects the transaction to close in the second quarter of this year.

The deal is Dish’s third mobile service provider acquisition in less than a year.

It closed its $1.4 billion acquisition of Boost Mobile, the prepaid brand divested by Sprint as part of its merger with T-Mobile US, in July last year, a move that marked its entry into the retail mobile market in the US. Industry watchers had been waiting for Dish to make a move for more than a decade, a time period over which it built up sizeable spectrum assets but seemed reluctant to put them to use.

By the time of the Boost deal – which also included an agreement to spend $3.6 billion on frequencies, incidentally – Dish had spent around $21 billion on spectrum licences and buying up companies with spectrum assets and was facing the expiry of some of its licences for having failed to meet rollout targets, despite some efforts in the narrowband IoT space. Last September the FCC agreed to extend many of its licences, using the lengthy process leading up to the T-Mobile/Sprint tie-up as justification for its decision. But Dish was left in no doubt: roll out 5G on this spectrum…now.

Also in September Dish spent the best part of $1 billion on 3.5 GHz licences, but picked up just one licence in the $81 billion 3.7 GHz auction that closed earlier this year, spending just $2.5 million. Its total spectrum spend is enormous, and that’s without factoring in the cost of network rollout and the customers it is acquiring.

Dish is building out its own OpenRAN-based 5G network, but also has the use of the T-Mobile network for a seven-year period after the Boost deal closed. The acquisition of Boost gave Dish some 9 million mobile customers.

A month after it took ownership of Boost, Dish announced the acquisition of MVNO Ting Mobile, picking up another quarter of a million or so customers and brokered a deal with its erstwhile parent Tucows to use its mobile services enabler (MSE) platform, which provides network access, provisioning and billing services for MVNOs. (According to Tucows, Ting Mobile had 256,600 mobile subscriptions under management as of mid-2020 and just over 150,000 mobile accounts under management; both figures have been in decline for a couple of years.)

The Republic Wireless deal is similar, in that there is an added facet to it, rather than simply being about the acquisition of customers.

The transaction includes Republic’s Relay division, which essentially offers a walkie-talkie and tracking-type service to certain demographics, including children and seniors, and industries. In its own words, Dish describes the business as providing “communication and productivity solutions for frontline teams in hospitality, facilities management, manufacturing, healthcare and education.” Relay will continue as a standalone business after the deal closes and will become a wholesale customer on Dish’s 5G network.

While Dish is clearly looking more broadly at the mobile market, rather than channelling all its energies into the acquisition of retail customers, it does need to start building up its customer base if it is to fulfil expectations about becoming a credible fourth player in the US mobile market…and recouping some of its financial outlay.

It ended 2020 with 9.06 million retail wireless customers, having lost 363,000 in the fourth quarter, more than the 212,000 net losses it posted in Q3.

Acquiring 200,000 customers from an MVNO – which prides itself on affordable plans, incidentally; those ARPUs are not going to be huge – is a drop in the ocean in a market in which the big three all have customers bases at around the 100 million mark. We need to see more from Dish in the mobile space.