The last few months of new coverage surrounding the Sprint and T-Mobile merger have talked about how DISH will become the fourth-largest wireless carrier in the United States virtually overnight, but will the satellite company actually be able to compete in that landscape? Let’s take a closer look at what looks to be an uphill battle for DISH Network.
At this point it looks like the Sprint and T-Mobile merger will be finalized in the near future. As a result of that deal, DISH Network will acquire Boost Mobile, Virgin Mobile, the Sprint-branded prepaid service and access to T-Mobile’s network for the next seven years. During those seven years, DISH is expected to get their own wireless network up and running.
According to the requirements put in place by the U.S. Department of Justice (DOJ), DISH is required to build out their own wireless network that will cover 70% of the U.S. population by 2023. If DISH fails to meet that benchmark they will face fines in the billions of dollars. So far, DISH co-founder and chairman Charlie Ergen has maintained that the company is on track to meet that deadline with ease.
If this merger does go through as expected, and DISH is able to meet the DOJ deadlines the company is still going to face the difficult challenge of convincing consumers to use their services over other brands like T-Mobile, Verizon and AT&T who have been building their reputation in the wireless space for years.
Many experts believe that the key to success for DISH will be a robust retail strategy, but again they’re facing competition that has spent millions building out retail strategies of their own. Sprint has nearly 4,000 stores in the U.S. at the moment with another 1,800 being operated by Sprint dealers. Every Walmart, Best Buy, Sam’s Club and even some Costco’s also promote Sprint’s products.
Now, it is true that Boost Mobile has a lot of retail spaces in the United States already, and DISH network will inherit those stores. Which means that Boost is going to have to be a critical component of any retail strategy that DISH brings to market.
DISH has a lot of work to do before we will see large amounts of consumers switching from more established brands to their wireless network. Aside from retail, a massive marketing campaign is going to be essential to their success. Unfortunately, marketing campaigns at the scale they are going to need cost tens of millions of dollars. Couple that with the millions DISH needs to build out a 5G network of their own and it becomes more difficult to see a path to success for the company.
Naturally, DISH remains confident that they will be able to pull this off. To their credit, there is still a lot of information that they have yet to make public. One thing is for sure, once the Sprint and T-Mobile merger is finalized, U.S. consumers are going to start seeing DISH Network’s name a lot more frequently.