DISH will pay AT&T at least $5 billion over the next decade to use its network, following a dispute with T‑Mobile.
In an effort to phase out older technology, T‑Mobile stopped activating and selling phones that lack VoLTE support beginning in August 2020, pushing remaining 3G users to upgrade. DISH objected to T‑Mobile accelerating the retirement of its 3G CDMA network earlier than planned and accused the carrier of anti‑competitive conduct.
“T‑Mobile’s decision to shut down its 3G network by January 2022, which threatened to leave many of DISH’s customers without service, created a particularly contentious standoff between the companies and likely helped set the stage for DISH’s new agreement with AT&T,” says Tammy Parker, Senior Analyst at GlobalData.
DISH today announced the signing of a long‑term strategic Network Services Agreement with AT&T, designating AT&T as the primary network services partner for DISH’s MVNO customers.
Parker notes that the deal is very advantageous to AT&T: not only does it secure at least $5 billion in revenue over the ten‑year term from new MVNO subscribers, it also grants AT&T access to DISH’s spectrum holdings to support DISH customers on the AT&T network.
Under the agreement, AT&T’s network will carry service for DISH’s retail wireless brands, including Boost Mobile, Ting Mobile and Republic Wireless. The partnership is also expected to speed expansion of wireless distribution into rural areas where DISH already provides satellite TV services.
DISH is simultaneously building its own 5G network to meet a government commitment to cover 70 percent of Americans by June 2023. Until that network is complete, DISH will rely on capacity leased from existing operators.
“There has been speculation, even before DISH announced plans to build its 5G network using Amazon Web Services, about potential talks between Amazon and DISH for Amazon to use DISH’s future 5G infrastructure to deliver new services,” Parker adds.
The AT&T–DISH agreement also reflects AT&T’s caution about possible changes in DISH’s ownership: the contract allows AT&T to withdraw if there is a qualifying change in control of DISH. For now, however, the deal appears to mark the beginning of a mutually beneficial relationship.
“Both companies are well positioned to capitalize on continued growth in the US wireless market, driven by 5G rollouts that bring faster speeds, lower latency and new use cases—such as Internet of Things services—that may lead many customers to maintain multiple wireless subscriptions,” Parker says.
GlobalData forecasts cited by Parker predict a roughly five percent increase in unique mobile users in the US over the next five years, while total mobile subscriptions are expected to grow by more than 30 percent, reaching nearly 692.6 million US mobile subscriptions by the end of 2026.
(Photo by Isabella and Zsa Fischer on Unsplash)
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