T-Mobile's honeymoon with DISH over, as the Boost deal is held hostage by 5G network leases - PhoneArena

T-Mobile's honeymoon with DISH over, as the Boost deal is held hostage by 5G network leases

T-Mobile's honeymoon with DISH over, as the Boost deal is held hostage by 5G network leases
Those satellite TV honchos from Dish who have been at the forefront of the T-Mobile and Sprint merger opposition, expressing a number of reservations about reduction in competition and boost of prices in front of the FCC, turned on a dime when they were offered the prepaid carriers that T-Mobile and Sprint had to divest.

Boost, Metro, Virgin - these are household pay-as-you-go names with millions of subscribers and immediate brand recognition, and Dish immediately lined up for the goods. The Federal Communications Commission was placated so that T-Mobile and Sprint had a chance for the merger to pass through, and apparently prepaid was the way. Sprint and T-Mobile collectively held more than 40% of the pay-as-you-go market, followed by the carrier-agnostic TracFone with 32%, and Cricket with 25%, and now a big chunk of the prepaid market has to be activated by Dish as their own customers.

Sprint's prepaid, as well as the Boost and Virgin Mobile brands had to be offloaded, according to the merger agreements, so as to fit into the merger's antitrust requirements. Virgin's customers were already folded into Boost beforehand, so that both can be transferred to Dish, effectively creating a distant fourth carrier again with about 10 million wireless subs already, if you don't count its own 12 million TV subscribers.

After acquiring Sprint’s prepaid businesses and customers, Dish is now given access to the network of the resulting new T-Mobile carrier for no less than seven years, in addition to the the opportunity of building its own independent 5G broadband network. The problem? The network is still under construction, and the Boost deal still isn't done and dusted.

The Boost Mobile deal still hasn't been closed by Dish

The government agreement with Dish was to buy Boost along with its Virgin-derived subs for $1.4 billion. The suggested deadline of June 1 came and went, and mum's the word on the acquisition, as otherwise Dish would've shouted from the rooftops that it is now the swanky 4th carrier in the favorite underdog status.

There is still time until July 1 that marks 90 days since the merger completion was announced but the technical hurdles of integration will be much more pressing to execute in the short amount of time remaining. According to the Dish co-founder and Chairman Charlie Ergen in a quarterly conference call with analysts: "We don't necessarily want to go back and we don't want to necessarily put people on the Sprint network, and then have to go back and switch them later, and the cost of switching later to T-Mobile network... [means] you have excess churn… So that condition hasn't been met yet."

There is more to it, though, and it's not just Dish wanting to do best for their future subscribers without bouncing them back between Sprint, where Boost came from, and the new merged T-Mobile network when it's up and at it. According to LightShed analysts speaking for FierceWirless, the honeymoon period of Dish and T-Mobile is over, and there are grievances now around the 600MHz spectrum leases.

Their opinion is that T-Mobile should strive for leasing all of Dish's 600MHz assets for no more than $350 million a year, and that the lease contract should be for at least three years. Dish is apparently biding its time, and wants to get a more favorable lease agreement before it closes the Boost acquisition and brings the whole process to a close, so that T-Mobile can focus on building out its new 5G network. 

Dish apparently is determined to fuse the two seemingly separate issues together, and may announce both a Boost deal closure, and a lease agreement of its coveted spectrum in one fell swoop. It has reportedly already signed "hundreds of leases" for towers already, according to Wells Fargo analysts, and won't be making the life of its future competition easier.
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