Dish Talking With Chipset, Tower Interests Before 2020 IoT Network

Dish Network is confident of meeting its March 2020 deadline for rolling out a 5G-centric narrowband (NB) IoT network, and is talking with chipset makers and tower owners with hopes of deals in coming months, executives told an earnings call Thursday. They expect to have radios using its AWS-4 and lower 700 MHz E-block spectrum holdings next year, being deployed shortly thereafter.

CEO Charlie Ergen said it won't be a standard deployment, necessitating development of specialized radio hardware. Ergen said initial IoT network work would be "the test bed" for yet more IoT connectivity the company plans and it's working to line up partners. Ergen said Dish sees NB IoT opportunities in partnering with carriers involved in their own deployments.

Dish said it ended the quarter with 13.2 million pay-TV subscribers, down 440,000 or 3.2 percent year over year. Ergen said the linear TV industry, while plagued with issues because of heavy costs of content and excessive commercial loads, is fixable. He said Dish's core business is relatively stable in large part because of its distribution aimed at rural markets. "We're on firmer foundation than we were a couple years ago," he said. Meanwhile, Sling TV's customer base is more urban and suburban, meaning little cannibalization by the over-the-top service, Ergen said. Asked about the value of keeping Dish's video business and spectrum holdings in one company, Ergen said there are strategic advantages given the heavy amount of video distribution online.

For Q3, Dish had revenue of $3.58 billion, down from $3.76 billion. It said due to Hurricane Maria damage in Puerto Rico and the U.S. Virgin Islands, Dish proactively paused service so customers wouldn't be charged, removing 145,000 customers from its pay-TV rolls. Chief Financial Officer Steve Swain said Dish's goal over the next year is to reconnect the majority, but it can't predict when they get service or how many will return. Ergen said Puerto Rico could be an opportunity because of the devastation that likely hit ISP Liberty Global, and satellite could be online quicker. Dish lost 50,000 net broadband subscribers, ending with 459,000.

The satellite company's spectrum might be attractive for AT&T, but it surely wouldn't be interested in doubling down on the direct broadcast satellite businesses, MoffettNathanson analyst Craig Moffett wrote investors Thursday, pooh-poohing an AT&T/Dish. He said ongoing subscriber losses mean "the wheels are officially coming off" its DBS business, and Sling TV "is economically irrelevant."

Ergen didn't comment on any Dish talks with the DOJ about AT&T's proposed Time Warner buy, though he said his experience with the failed DirecTV/Dish showed the agency is typically party to lots of behind-the-scenes information and does thorough analysis. "I wouldn't probably second guess the process," he said, saying he had concerns about AT&T/TW. The deal is facing antitrust headwinds (see 1711090019).

Dish signaled to the FCC it's ready to discuss its de facto control over designated entities for the AWS-3 spectrum when the agency is ready, Ergen said. The U.S. Court of Appeals for the D.C. Circuit in August remanded the order denying those DEs auction bidding credits to the agency to negotiate a solution (see 1708290012).