DISH Network is too excited for the next chapter in its history. Now that the $26.5 billion T-Mobile/Sprint merger has received both Federal Communications Commission (FCC) and Department of Justice (DoJ) approval, DISH has taken to its own blog to announce that it has acquired Sprint's prepaid offerings and will become the fourth US carrier, replacing Sprint.
DISH says it will provide a facilities-based 5G broadband network to cover at least 70-percent of the US by June 2023. If for some reason DISH does not fulfill that promise, it will owe the US Treasury as much as $2.2 billion.
As has been said repeatedly in the merger process, DISH's deal with merger means that it acquires Sprint's prepaid brands such as Boost Mobile, Virgin Mobile, and the entire Sprint Prepaid service. Sprint enters into its merger deal with T-Mobile as just "Sprint," no MVNOs or prepaid brands attached. DISH acquires 14MHz of Sprint's 800MHz spectrum employed nationwide and gets seven years of access to the New T-Mobile network for seven years.
The "New T-Mobile network" refers to the combined spectrum of T-Mobile and Sprint and what is left after T-Mobile releases Sprint's prepaid brands. DISH, then, like T-Mobile, will get access to Sprint's 2.5GHz spectrum for its 5G deployment too, meaning that DISH should have a quick rollout of its 5G network in the same way Magenta has said it will quickly deploy its 5G network.
DISH will create a 5G broadband Standalone network. Standalone 5G refers to an end-to-end network that is all 5G, built on newly existing technologies and not the "Non-Standalone" (or NSA networks) that use existing 4G networks for all tasks that don't need 5G to function.
The interesting thing aside from the merger and DISH's prepaid acquisitions is the price of the deal. DISH was estimated to pay about $6 billion for its Sprint prepaid brands, but the final price comes to about $5 billion. This price includes a $1.4 billion price tag for Sprint Prepaid, Boost Mobile, and Virgin Mobile, and a $3.6 billion payout for Sprint's 800MHz wireless spectrum.
The 800MHz wireless spectrum is low-band spectrum designed for better coverage and building penetration, so former Sprint Prepaid customers can expect improved wireless performance in buildings. The new 800MHz spectrum DISH acquires from Sprint will work with DISH's current 600MHz and 700MHz low-band spectrum holdings as well. More low-band spectrum for better building penetration is never a bad thing.
In addition to the 800MHz spectrum DISH pays T-Mobile for in the acquisition, DISH will, in turn, lease its 600MHz spectrum to T-Mobile for a small period of time (the exact timeframe unspecified in DISH's announcement).
DISH makes this announcement just as Deutsche Telekom-owned T-Mobile and Sprint merge to create "the New T-Mobile." T-Mobile was told in the process by the DoJ that it had to offset Sprint's Prepaid brand altogether for the merger to go through. The biggest concern in the merger was that the merger between the nation's third and fourth carriers would create only three carriers, eliminating some competition in the wireless space. The elimination of a wireless provider would then lead to higher prices and fewer jobs, as mergers often require businesses to lay off employees of the acquired company (in this case, Sprint).
Even now, the New T-Mobile must still fight off the State Attorneys Generals and the few US states who have filed a lawsuit to stop the merger. The court case commences this Fall.
In the T-Mobile/Sprint merger, though, all 400 employees and 7,500 retail outlets for Sprint will go to DISH, meaning that these employees will keep their jobs instead of losing them. T-Mobile has committed to creating at least 1,000 new jobs post-merger, as it stated throughout the process, and of keeping 5G prices at the 4G price range for at least three years after the acquisition is finalized.
DISH can acquire tower assets as well as network equipment and retail assets as part of the agreement, giving the satellite company all it needs to start its own wireless network. All in all, DISH acquires 9.3 million customers in all 50 states and Puerto Rico who are Boost, Virgin, and Sprint Prepaid subscribers. Keep in mind that the New T-Mobile will have 132 million subscribers once the merger is complete, a number that leaves DISH in the dust as far as the strength of the new "fourth carrier" is concerned.
Even with all this excitement, though, the merger "dark horse," Google, has yet to show its plans. Though a Google representative denied Google talks with DISH during the merger process, sources say that Google is interested in creating an independent network with DISH and freeing itself from leasing fees to T-Mobile and Sprint. Will Google re-emerge now that the merger has been blessed by the DoJ antitrust gods? That's for Google and DISH to know and for consumers to find out.