Dish's Hyped 5G Network (And 'Fix' For T-Mobile/Sprint Merger) Is Looking Rather Skimpy

from the good-luck-with-that dept

Two years ago the Trump DOJ and FCC rubber stamped the Sprint T-Mobile merger without heeding experts warnings that the merger would likely erode competition, raise rates, and kill jobs. Then, working closely with T-Mobile and Dish, the FCC and DOJ unveiled what they claimed was a “fix” for the problematic nature of the deal: they’d try to cobble together a fourth major replacement wireless carrier in Dish Network.

As we noted a few times the proposal was never likely to succeed. One, because Dish had no track record in this space outside of a parade of empty promises. Two, because the remaining three providers (AT&T, Verizon, T-Mobile) want less price competition and would be incentivized at every step to ensure it fails. Three, because the government would likely dole out more than wrist slaps should Dish miss major build out milestones.

So far, things are going just about as well as you’d expect. T-Mobile has already laid off 5,000 employees, and the plan has been mired with endless squabbling between T-Mobile and Dish. And both the beta and commercial launch of Dish’s 5G network, first in Las Vegas, keeps being delayed. There is technically a network operating in Las Vegas, but most folks in wireless continue to eye the company’s plans with justified skepticism. Early analysis of the network that does exist isn’t what you’d call bubbly, as both speeds and coverage are sorely lacking after repeated delays:

“They have some work to do to catch up,” summed Emil Olbrich, VP of networks with Signals Research Group (SRG), in comments to Light Reading. He said Dish’s 5G network in Vegas isn’t as good as T-Mobile’s 5G network in the city, but he said it’s still early days for Dish and the company likely will improve its offering…the firm’s initial findings indicate Dish likely isn’t providing the blazing-fast speeds that other 5G providers are.

“They’re going to have some issues,” Olbrich said of Dish’s efforts to refine its network in Vegas.”

Here’s the problem: to meaningfully build a nationwide 5G network that people actually like and use, Dish is going to need a massive trove of cash and to compete on price. But the company continues to bleed the customers it does have — traditional satellite TV customers — at an alarming rate. Here’s the other problem: motivating T-Mobile to actually meet set FCC benchmarks (its network has to cover at least 70% of the U.S. population with 5G by 2023) requires regulators willing to impose major penalties and stand up to large telecoms, and the U.S. simply… doesn’t have that (regardless of the political party in power).

The Trump folks who pitched this deal knew that. I’m fairly convinced this has always been a performance to justify approval, with the crafters knowing the end result will be a Dish face plant and reduced competition (and fatter revenues) in the wireless space. I also tend to think Dish is inevitably doomed, and this could just be an elaborate exit package for CEO Charlie Ergen, who could eventually sell off the company’s massive spectrum holdings and existing build for tens of billions of dollars, throw a few nickels at any regulatory and legal penalties that result, and still ride off into the sunset with a fat stack of cash.

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Companies: dish, sprint, t-mobile

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Comments on “Dish's Hyped 5G Network (And 'Fix' For T-Mobile/Sprint Merger) Is Looking Rather Skimpy”

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7 Comments
Anonymous Coward says:

Re: Telling them...

I used to work with some of the engineers involved. I am certain that all of the relevant information was made available. It may not have been understood completely/correctly.

The upshot is that two major peer level carriers existed — now three exist. T-Mobile and Sprint individually lacked the assets and size to challenge AT&T and Verizon. Maybe four or five competitors would be preferable, but that probably involves a breakup of the top two.

IMHO, level competition in this market will require similar coverage, similar equipment order size, similar financial access, and similar data backhaul costs. Since AT&T and Verizon grew out of RBOCs, they have large advantages in all of these areas. Higher frequency ranges and increased data requirements of modern mobile equipment exacerbate the inequity. Higher frequencies require more towers to cover the same area. Increased data transmission increases data backhaul requirements from each tower.

sumgai (profile) says:

Re: Missing word?

No, Karl has it correct. The intent of the sentence was to say that the government would come down hard on Dish for missing the milestones, and thus they would continue to falter, ultimately face-planting even sooner than projected. You can be sure that the Big 3 would be right there in everyone’s face, jumping up and down about how Dish needs to be penalized heavily for missing those deadlines…. "because you always keep hitting us hard when we screw up, so Dish needs to be hit hard, too".

The difference will be in the percentage of available cash in the bank that backs the check written to the gov’t – the Big 3 can afford almost anything in the numbers we’ve seen over the past 5 decades, whereas Dish will likely be FUBAR’ed into the trash heap of history. You do recall that investors abhor losers, yes?

ECA (profile) says:

AND still the same question

Why can we see the problems when our Congress CANT?

No one up there has any idea the problems with capitalism or they deny those problems.
Or they are being Bombarded with FAKE data from the corps/lobbyists.
There are very few answers to this, because the contracts the Gov. THINKS they created to get more done, ARNT being enforced.

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