Dish Network makes bid for Sprint
Satellite TV company touts greater synergy
NEW YORK – Dish Network Corp. is trying to snag U.S. wireless carrier Sprint Nextel away from a Japanese suitor, the latest sign that satellite dishes are losing their relevance in the age of cellphones that play everything from YouTube videos to live TV.
Dish offered $25.5 billion in cash and stock on Monday for Sprint, which Dish says beats an offer from Japan’s Softbank Corp.
If the Dish deal goes through, it would create a unique combination of pay-TV and wireless operator. Dish’s hope is that it would lure customers with the promise of a TV service that they can take with them out of the house, on their phones. It has already broken ranks with the pay-TV industry by providing a set-top box that can send recorded shows to iPads.
“You want to be in your home with video, broadband, and data, and voice, and you want to be outside your home with those same things,” said Charlie Ergen, Dish’s executive chairman. “And while the cable industry does a really good job in your home, and the current wireless industry does a really good job outside your home, there’s really no one company on a national scale that puts it all together. The new Dish-Sprint will do that.”
Sprint Nextel Corp.’s stock jumped on the news, as investors anticipated a bidding war between Dish and Softbank. Sprint had accepted the Softbank offer and was expecting to close on it this summer. Sprint, the country’s third-largest cellphone carrier, said it would evaluate Dish’s offer.
For years, Dish has been able to grow rapidly by luring cable TV subscribers with better deals. But its subscriber numbers have been flat for the past three years. Unlike TV cables, satellite dishes aren’t good conduits for Internet access. That means that Dish and larger rival DirecTV have been left behind in the rush to connect homes to broadband, while cable has been able to retain customers by offering TV, Internet and phone bundles.
Dish has 14.1 million TV subscribers, making it the No. 2 satellite-TV company after DirecTV. Sprint, based in Overland Park, Kan., has 55.6 million wireless devices on its network.