-
Dish parent EchoStar filed a letter with the FCC saying it fulfilled the drive test component of its 5G buildout requirements
-
The letter certifies that its 5G network provides speeds of 35 Mbps or greater to over 70% of the U.S. population
-
It's a positive development amid a sea of dire financial forecasts for the company
Dish Network might be floundering when it comes to the number of customers actually using its network, but it’s winning accolades for building the world’s first commercial-grade open RAN 5G network in record time.
The latest development in Dish’s 5G journey is a letter its parent EchoStar (NASDAQ: SATS) filed with the FCC this week certifying that its nationwide 5G network provides download speeds of 35 Mbps or greater to over 70% of the U.S. population.
A recap for those who don’t walk around with encyclopedic brains: In June, Dish announced that it was offering 5G broadband service to over 70% of the U.S. population, meeting one of its 5G FCC buildout requirements as part of the deal that enabled T-Mobile to acquire Sprint. Remember: Dish was supposed to take Sprint’s place as the nation’s fourth facilities-based wireless carrier.
As Dish’s financial troubles mounted last year, the FCC provided a vote of confidence for Dish in the fall when it formally issued a statement saying Dish had met its band-specific 5G commitments thus far. The FCC gave Dish six months to conduct drive testing and submit those results.
This being roughly six months later, Dish delivered the goods, but guess what? The results are under wraps because Dish considers the information to be proprietary and could result in “substantial competitive harm” if disclosed.
The drive test results contain the details of, among other things, Dish’s 5G wireless network performance throughout the United States, so, yeah, they probably want to keep that under wraps. The last thing they need is some rival using it to gain an advantage. These days, Dish needs all the help it can get.
VoNR progress
Last month, Dish announced that the Boost wireless network is now available with 5G voices services – or Voice over New Radio (VoNR) in industry parlance – to more than 200 million people nationwide.
In a recent note for investors, analysts at TD Cowen said the VoNR announcement is a good sign on the progress made toward the shot-clock deadline and a bullish sign to attract suitors (like Amazon or Vodafone) for a potential partnership. “We note a potential partnership would be highly bullish” for EchoStar and “highly disruptive for the wireless industry,” they said.
Tough year
During EchoStar’s March 1 quarterly conference call, EchoStar Chairman Charlie Ergen was noticeably absent, although EchoStar CEO Hamid Akhavan said they wanted to “give him a day off” for his birthday. It just so happened that the day before, EchoStar revealed in a 10K SEC filing there’s “substantial doubt” about its ability to continue as a going concern.
Akhavan stressed the awesomeness of Dish’s 5G network and called 2024 a “transition year.” He essentially asked for a year to figure it all out. The company expects to meet its immediate debt repayment obligations this month and then needs to find additional financing to pay off a $2 billion debt maturity due in November.
But analysts at MoffettNathanson aren’t too hopeful. In a March 1 note for investors, analyst Craig Moffett noted that Dish has lost 2.6 million subscribers since entering the wireless business in 2020 through the Boost Mobile acquisition, posting a subscriber gain only once in 14 quarters, and that was a paltry 1,000 net additions in Q3 2022.
“To state the obvious, neither the Boost prepaid business nor the nascent 5G business looks like a meaningful operating asset in the likely event of a bankruptcy,” Moffett wrote. “Spectrum salvage is all there is here.”
However, whether spectrum sales of any size would be allowed isn’t entirely clear, he said. And for the past decade, spectrum auction results have been inflated by the consistent presence of a wildcard bidder – Dish Network itself.
“With Dish as the seller rather than a buyer and with the balance sheets of the Big Three badly overburdened by years of spending on spectrum, can anyone be confident about what auctions would bring?” In addition, “there will inevitably be questions about whether EchoStar and/or its creditors actually own the AWS-4 spectrum or whether that spectrum is actually owned by U.S. taxpayers.”