What could Dish + Sprint mean for the future of mobile video on iOS?

What could Dish + Sprint mean for the future of mobile video on iOS?

Satellite TV innovator Dish Network has thrown a monkey wrench into Softbank’s plans to acquire a 70% interest in Sprint by offering a 13% premium over Softbank’s bid, and rather than buy a majority of Sprint they’re proposing a full merger. For those of you who really want to understand the thinking that went into this, watch the AllThingsD video interview with Dish chairman Charlie Ergen . It’s a long video, but damn, you have to admire the straight-up answers Ergen gives to the audience.

My take on the whole thing is pretty simple. Dish Network is part of the old world just like Cable TV, except that they have no easy way to deliver broadband access to customers. Cable companies, at least, have DOCSIS networks. So even if the whole planet starts to cut the cord and adopt an over the top Internet TV model, they can still get paid for the plumbing. Satellite? Not so much. Without adapting their business model these guys are dying a slow death.

Dish has been very clear about its desire to own a wireless network. But they’ve also acknowledged the difficulty in building out such a network without a customer base to help finance it. A partnership has always been something that made more sense to them, based on all the public commentary.

Dish even bid $5.15 billion for Clearwire about 3 months ago. But Sprint had already bid for the 49% of Clearwire that it didn’t own, and being the majority shareholder, it was seen as unlikely that Dish’s bid would matter at the end of the day.

So what’s a satellite guy to do? Go big or go home. Step up the bid and make a play for the entirety of Sprint. Assuming the Clearwire acquisition by Sprint closes, Dish would end up with a monumentally huge spectrum asset as well as a huge customer base on which to justify an incredible LTE build out.

We all know that the future of TV is over the top. And we all know that mobile data is being used more and more to watch video. If Dish owns Sprint it can conceivably get creative in how it charges its customers for access to video. While most wireless providers are charging a hefty premium for high bandwidth plans (to accommodate video), I imagine Dish would be able to offer unlimited streaming of its programming to mobile devices provided that those devices were connected via Wi-Fi or Sprint’s network.

Sprint and Dish, together, have about 70 million customers minus whatever portion of Dish’s existing 14 million subscribers are also shared with Sprint. So the scale they could achieve, together, is significant. By comparison, Netflix has about 27 million US streaming customers.

That said, Netflix has a very different model. There are no channels on Netflix. There is just programming. There is no concept of live TV at all. And the price is right at $7.99 per month. Today’s kids are not growing up as subscribers to Pay TV such as Dish or Cable TV. So the old world video guys need to change their model.

Yet Netflix (and Amazon, and Hulu and others) do not have access to live sports or news. Apple TV only has whatever access their limited quantity of partner apps, like MLB and NHL provide them, blackouts not withstanding. The over the top video model is not complete. Neither the new-world streaming players nor the old-world cable and Satellite guys have a full solution. They’ll both likely fight to migrate towards a complete model.

Unless Softbank raises its bid, or someone else comes into the game, I think the Dish bid for Sprint will succeed. It is a very logical business combination. And it could shake up the TV market in a good way. It could make Sprint far more relevant in the wireless game. It could force other wireless players to reduce bandwidth restrictions to maintain a competitive stance. It will likely spur more partnerships or acquisitions.

Overall, I think this is good news for US consumers - and that includes iOS users. Things are about to get very, very interesting.

Chris Umiastowski

Chris was a sell side financial analyst covering the tech sector for over 10 years. He left the industry to enjoy a change in lifestyle as an entrepreneur, consultant, and technology writer.

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There are 36 comments. Add yours.

ctt1wbw says:

Yes! Video coming in on Sprint's 3G network at 0.04 megs per second!!!

NamelessStar says:

always a pleasure to read your articles Chris no matter the site they go on :D follow your articles across all sites but mainly CB. Nobody seems to have such well placed articles as you do i look forward to each one you write.

R1cki97 says:

Well, if the companies parter up, sprint should think about making their internet more faster and make their signals stronger, because you don't really want be able to stream movies and shows with slow internet, it will just piss you off, by the way nice review

Behshad says:

Satelitte isnt a dying business. Even with the best internet services around, we are at leats 10 years away from replacing conventional TV useage with internet .
Dish has always been one step ahead of the competition and they must have something up their sleeves to create some more solid products for the next 3-5 years.

pappy53 says:

One step ahead of the competition? DirecTV eats their lunch in programming, HD, and customer service. Dish is losing customers every year.

Behshad says:

Thats what you think cause you love your direct TV. First of compare the HD programming and Dish is ahead. Also look back at when HD programming became available , dish was way ahead of Direct TV, Look at the mobile and Dish anywhere, 4 years ago I could watch any of my Dish channels on my phone anywhere in the country, does Direct TV even offer the TV Anywhere ? And the PrimeTimeAnyTime on Hopper is unbeatable.
Its little things like that , that always put Dish one step ahead. Just cause DTv copied it and applied it , doesnt mean they "eat their lunch".

pappy53 says:

First of all, I don't have Directv. But if Dish is so great, then why are they losing customers, and Directv is gaining customers? And why is Directv rated #1 in CSI every year?
Directv has the best HD programming, and much more than Dish. But I will give it to the Hopper, as it is a great piece of equipment.
And, yes, there is Directv Anywhere.

Behshad says:

Can you back it up with some facts that Dish is losing customers?
Can you back it up with some facts that DTV has better HD programming than Dish ?
DirectTV anywhere is less than a year old, so yes they do catch up after a while.
Much like after seeing Dish aquire Sprint, DTv will be looking for a company to purchase.

Last but not least, if you think Direct TV is the best when it comes to HD and CSI and everything else, may I ask why you arent a Dtv customer ? ;)

pappy53 says:

You are the one that first said that Dish was better at HD, so where are your facts? TWC made me an offer that I couldn't refuse on a bundle.

Behshad says:

I said Dish has always been a STEP ahead of its competition.
Facts :
Dish started of with twice as many HD Channels when HD programming became available.
Dish was the first to offer "watch your show anywhere" , with their 922Vip box. With built in Sling
And Dish was founded 1980, vs DTV 1984.

Theyre both solid companies and chosing one over another is a matter of opinion, specially with consumers like you who would give up the BEST , for the "great deal from TWV" ;) but I stand by my statement that Dish has always been one step ahead of DirectTV :)

pappy53 says:

This is an article on dailyfinance.com. Can't post a link on here.

"It's Breaking Badly for Dish: Satellite TV Provider Still Losing Subscribers"

Rob White says:

Can you 2 find something sillier to argue about? I get it you like Dish & the other guy is pointing out the merits of DTV. They both have their merits.

But to bolster Pappy53's claims just a little. Dish has had flat subscriber numbers for years while Directv has added subscribers. And the part-time HD Dish used in their channel feeds for years isn't 'true HD' that is always available. The channel packages offered by Dish have always been heavily packed with music & shopping. In other words cheap programming so they could claim increased numbers of channels available. I'll give you the Hopper. That is pretty innovative tech. But let's see if they can keep all the channels from pulling out because of it.

But like it or not, Directv has won all the customer satisfaction awards as well as added new subscribers every year. That's not hyperbole it's simple fact from major consumer studies that are easily verified.

Behshad says:

So first you say we should something sillier to argue about, yet you choose to join in !? lol
Dish vs DTV is a matter of opinion and taste. Doesnt matter how many trophys either of them has on the shelf, my original and first statement was Dish has always been a step ahead of competition, which they have. The rest is matter of opinion.
With Spring on their side Dish could use sling and mobile streaming and take it to the next level.

Rob White says:

I jumped in to correct your factual errors. Of which you still are making them. Dish has not always been ahead of its competition. That is your opinion. Expert analysis from the television industry & customer adoption rates don't back it up. You sound like a Dish employee truth be told.

Oh & I think you meant 'Sprint' not 'Spring'. That is what you meant isn't it?

Behshad says:

How did you correct me on FACTS.
As I said before, the prefrence of liking one over the other , is a matter of OPINION.
BUT when it comes to TECHNOLOGY, and being first, Dish has always been ahead of Direct TV. Thats not my opinion. That has nothing to do with Expert analysis on who has more users. It is a simple fact that Dish was first with HD packages, Dish was first with mobile and internet live streaming and Dish was first with their very first Satelitte Signal.
Meanwhile , go ahead and make factual correction on my TYPOS ;)

pappy53 says:

FACT: Dish may have been first, but Directv made it better.
FACT: Directv is gaining customers, while Dish is losing customers.
FACT: All HD channels on Directv are full-time, unlike Dish.
PROBABLE: You are a Dish employee.:)

Rob White, you are correct. This is silly!

Rob White says:

Yeah this is getting ridiculous. So I'll leave him to his fantasy. If I need to I could go into my broadcasting experience at WRAL TV in Raleigh, NC that broadcast the 1st ever HDTV signal in 1996. But no matter.

I also didn't mean to imply you were a fool if it came off that way.

Rob White says:

Hello fellow Tarheel! Although I happen to be a lifelong Duke fan ;-)

I'll forgive the Yankees pic lol.

pappy53 says:

Lifetime Dukie here, too! Mickey Mantle made me a Yankees fan growing up.

Rob White says:

*sigh*

Still wrong. Voom was the 1st ever HD satellite service. It was owned by Cablevision & later leased to Dish. It wasn't their creation. Directv actually had its own HD satellite launched & in service BEFORE Dish lost the lease of Voom from Cablevision. Dishes mobile & live streaming also was provided by some partner. It wasn't their creation. Broadband satellite just in case you want to go there? They bought Hughesnet to get in on that action. The Hopper in fact is piggybacking on tech pioneered by TiVo.

But do continue to shout your fantasy. I've got more important things to do.

Behshad says:

Does voom exist today ? Nope.
So fact : Between Dish and DirectTV, Dish was the first to offer HD programming to its customers.
And yes they did the mobile streaming, not as parterns but through a company they bought out.
So they were there before DirectTV,
Yep and you got me, I work for Dish lol, just cause I bring you facts about a company, then I guess I work for Voom, Sling and Apple while youre at it too .

pappy53 says:

They may be first, but they finish last.:(

CORYK333 says:

You want them to stop arguing, yet you leave a long post getting involved in the argument you want stopped?? C'mon b, how does that work? Or is your response the END ALL BE ALL of the discussion??
Clowns on here sometimes........

pappy53 says:

please don't even post if you're going to use profanity like that. Thank you.

Rob White says:

Grow up kid. Your profane tirade doesn't make you look mature or capable of intelligent discussion.

CORYK333 says:

Alright pops, I'll try. Wasn't looking for an intelligent discussion, just pointing out how ridiculous your comment was. No need to acknowledge me as I have no urge to be involved.
-I'll be going now. By all means continue your argument about which satellite/cable provider is the best.......and I'm the immature one, smh

pappy53 says:

Your language shows your immaturity.

Behshad says:

awe, look at them standing up for eachother. lol
Im glad this argument brought you two together Pappy&Rob. Congrats :) ;)

Behshad says:

not one bit, but extremley happy for you ! :P

ericUT says:

I'm surprised that wasn't even a single mention of leveraging Sling.

Imagine on-demand native access to live DISH programming over Sprint's LTE network using SLING technology.

asuperstarr says:

This was good article. So I wonder if the carrier will take the offer. This could change the streaming dynamics. I don't think dish is the right choice. They didn't do anything with blockbuster. So my hopes are to high.

Derrick4Real says:

i have to wonder if not having softbanks deep pockets would be a problem. I also wonder if going with dish rather than a foreign company may mean sprint doesn't bring in many other ideas like no contracts or something.

Derrick4Real says:

reading this it's a lot about how this deal benefits Dish. Honestly, if you're Sprint and your concern is building out LTE, I'm not sure how much they care about the TV part. Especially when tv is largely going hd. i have to wonder how feasible it is to pump 1080i tv over cell networks to all of the masses. But anyways, if i'm sprint i'd have to wonder if it's better to take the deep pockets of Softbank to build out the network. Sure you'd get some of the Dish bandwidth but will they have the cash after the purchase to make the network as good as or better than Verizon? I don't know. That's above my paygrade as they say. But as a sprint user, who isn't gonna switch to Dish, gotta wonder what benefit Dish gives me over a Softbank.