What's next for Dish after losing out on Sprint?

The satellite provider may try novel approaches to getting into the mobile business

By , IDG News Service |  Mobile & Wireless

As the dust settles after SoftBank's US$21.6 billion acquisition of Sprint, losing bidder Dish Network may be just getting started at stirring up the U.S. mobile industry.

The satellite TV and Internet provider tried to buy Sprint and Clearwire but failed in both efforts when SoftBank closed its own deal to become the third-biggest mobile operator in the U.S. But led by an aggressive chairman and facing a lackluster satellite TV industry, Dish still has incentives to break into mobile and may do it through a new type of partnership or network, analysts say.

Mobile services and apps are growing a lot faster than TV or relatively slow, expensive satellite Internet. That's partly why Dish has amassed two chunks of land-based mobile spectrum and may be trying to scoop up more. Spectrum is the lifeblood of mobile, and Dish seems intent on becoming a player one way or another.

"If they don't have some form of a wireless play, then it's very hard for them to survive longer term," said Chetan Sharma, founder of Chetan Sharma Consulting. That's because consumers are increasingly watching video online rather than over broadcast, cable or satellite TV. In fact, the U.S. consumer satellite industry may soon shrink, with Dish possibly acquiring DirecTV, analysts say.

Dish has two kinds of spectrum that are approved for commercial mobile use: a block of frequencies it bought in the FCC's 700MHz auction in 2008, and the so-called AWS-4 frequencies it acquired by buying two bankrupt satellite companies in 2011. If Dish succeeds in buying another bankrupt satellite company, LightSquared, it would have yet another set of frequencies it might be able to use for cellular services. Dish Chairman Charlie Ergen reportedly has already bought a large part of LightSquared's debt, and Dish is now offering $2.2 billion for the company.

But in the cellular world, Dish isn't likely to build its own network, a project that would cost billions and might take years. Instead, the company will probably keep trying to buy or partner with an existing operator, analysts say. That would be a quicker and cheaper way to put its frequencies to work, which the company will have to do in order to keep its spectrum licenses.

An existing carrier could add equipment for Dish's spectrum to its cell sites and then offer new devices to its customers to take advantage of those bands. Dish's video business could also be a plus, with opportunities to bundle or cross-promote it with mobile services.

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