DISH Network (NASDAQ: DISH) and EchoStar (NASDAQ: SATS) yesterday announced a definitive agreement to combine the two companies in an all-stock merger. When the merger completes, existing DISH shareholders will own approximately 69 percent, with existing EchoStar shareholders holding the 31 percent balance, of the common stock of the combined company. The transaction amalgamates DISH’s satellite technology, streaming services and nationwide 5G network with EchoStar’s satellite communications solutions. The combined company will provide terrestrial and non-terrestrial wireless connectivity. Such a deal could have important implications for the U.S. wireless business.
DISH is making progress as the fourth national 5G mobile network operator, having met the 70 percent U.S. population coverage requirement in June, Inside Towers reported. The company offers prepaid and postpaid retail wireless services through the Boost Mobile, Boost Infinite, and Gen Mobile brands, as well as 5G network deployment services. DISH operates as a MVNO on the T-Mobile and AT&T networks, while building its 5G network. But DISH’s Wireless business is struggling to gain traction. At the end of 2Q23, DISH reported 7.7 million Wireless subscribers, representing a net loss of 188,000 subscribers in the quarter, and down from a total of 7.9 million in 2Q22. Continue Reading
In its Pay-TV business, DISH offers satellite and over-the-top video services. But that business also is floundering as subscriber viewing preferences shift to less expensive and flexible streaming video and away from pay-TV. As of June 30, DISH had 8.9 million U.S. Pay-TV subscribers, a net loss of 294,000 subscribers in the quarter.
EchoStar, through its Hughes subsidiary, offers satellite broadband services to consumers, businesses, governments, and military customers around the world. It also provides satellite services to other satellite operators, broadcasters, pay-TV providers, and telecom companies through its EchoStar Satellite Services segment. But Echostar too has financial challenges. Its consolidated 2Q23 revenue declined by over nine percent YoY to $453 million, having lost 106,000 broadband customers since year-end 2022.
Still, both companies claim they have strong momentum. DISH is extending its 5G wireless network reach and full commercialization is underway. At the same time, Echostar successfully launched its JUPITER 3 satellite with significant available capacity for converged terrestrial and non-terrestrial services. With the merger, the company believes it is operationally well-positioned to deliver a broad set of communication and content distribution capabilities, while accelerating the delivery of satellite and wireless connectivity solutions desired by customers.
By John Celentano, Inside Towers Business Editor