Dish CEO: We Plan to Have "Significant Role" in Wireless Industry
Dish Network (NAS: DISH) intends to make a mobile broadband play with its recently acquired S-Band satellite spectrum, the company's CEO said, though it remains unclear what kind of wireless offering the satellite TV provider will bring to the market.
On the company's second-quarter earnings conference call, Dish CEO Joseph Clayton -- who has been on the job since May -- said Dish will use its recent spectrum acquisitions to "have a significant role in the evolving world of wireless communications, and this is the principle reason that I am here" at the company.
According to a Morningstar transcript of the call, Clayton said that Dish will keep its plans "somewhat nebulous," but he did lay out several options for the company. "We will keep our options open, we will not tip our hand and we will continue to pursue the necessary assets to shape our long-term strategy," he said. "This could include additional acquisitions, partnerships, alliances or even parting with assets that might not prove to be strategic going forward."
Clayton also said that Dish could use wireless service to deliver content. He said that delivering video is going to remain the company's primary objective, but that, "we're also very interested in wireless broadband for a lot of our secondary and tertiary customers throughout our market."
Dish received final approval in July from a bankruptcy court judge to purchase TerreStar Networks for $1.375 billion. The purchase nearly matches the $1.4 billion Dish will pay for DBSD North America, a transaction that won bankruptcy court approval in June. Dish Chairman Charlie Ergen pushed for the deals, and Clayton said Ergen "believes that these actions have been the best possible usage for the company's available capital." Together, DBSD and TerreStar each give Dish access to 20 MHz channels of S-Band spectrum.
Tom Cullen, Dish's executive vice president of sales, marketing and programming, said the company will file a request with the FCC within the next two weeks to transfer the spectrum licenses to Dish. He declined to discuss whether Dish will define a business strategy for the spectrum when it makes its filing.
BTIG analyst Walter Piecyk told FierceWireless that he does not think Dish will describe a business model in its license transfer request, noting that Dish likely wants to get the spectrum and avoid any unnecessary complications at the FCC. "I think they want to keep a very low profile," he said, adding that the licenses might be transferred by the end of the year or early next year.
When asked if Dish might reveal part of its wireless strategy in connection with Sprint Nextel's (NYS: S) Oct. 7 investor conference -- Sprint has promised to discuss its 4G strategy during the event -- Cullen said that he "wouldn't expect anything in the near term." He also declined to comment on whether Dish would be interested in buying Qualcomm's (NAS: QCOM) 700 MHz MediaFLO spectrum, should AT&T (NYS: T) not be able to purchase it. The FCC said it will consider AT&T's proposed $1.93 billion purchase of the Qualcomm spectrum spectrum side-by-side with AT&T's planned $39 billion acquisition of T-Mobile USA.
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