AT&T and DISH’s new agreement a win-win as both companies can ride the 5G wireless wave, says GlobalData

Following today’s news (19 July) that AT&T will become the primary network services partner for DISH MVNO customers;

Tammy Parker, Senior Analyst at GlobalData, a leading data and analytics company, offers her view:

“This deal is highly beneficial to AT&T as the company not only gains at least $5bn in revenue streams over the term of this ten-year agreement from new MVNO subscribers, it will also have access to DISH’s spectrum holdings to support DISH customers on the AT&T network. The NSA is not exclusive for either party, so both can go out and find new dance partners; however, given the depth and breadth of this agreement, that would appear both unlikely and unnecessary.

“Both companies are poised to ride the US wireless industry’s ongoing growth wave. This is increasingly driven by the rollout of 5G, which enables faster network speeds, lower latency and new use cases, including Internet of Things services, that will result in many users having multiple wireless subscriptions. According to GlobalData’s latest forecasts, the number of unique mobile users in the US will increase by 5% over the next five years. Furthermore, total mobile subscriptions in the US will expand by more than 30% during that time and there will be nearly 692.6 million US mobile subscriptions by year-end 2026.

“A fascinating part of this new arrangement is that it provides a glimpse into AT&T’s concerns regarding the possibility that DISH could sell out to another entity, perhaps even Amazon or Google. Rumors have abounded, even before DISH agreed to build its 5G network on Amazon Web Services’ (AWS) cloud platform, about possible negotiations between Amazon and DISH regarding the former’s potential use of DISH’s forthcoming 5G network to offer new services. Though there is nothing new to report there, this NSA stipulates that AT&T will be allowed to terminate the NSA in the event of a qualifying change of control of DISH. This could include a rival wireless provider, US cable company or ‘certain large technology companies’ taking over 50% more of the voting power or economic value of DISH. AT&T would still have to support DISH’s MVNO customers for up to two years after such a termination.

“T-Mobile, and its Sprint network, is currently the primary MVNO partner for Boost and Republic. Ting operates on every nationwide network except AT&T. However, although DISH’s involvement saved T-Mobile’s acquisition of Sprint, the relationship between DISH and T-Mobile appears to have been fraught from the start. T-Mobile’s plans to shutter its 3G network by January 2022, leaving many of DISH’s customers without network service, has created an especially contentious standoff between the two companies, which likely helped pave the way for DISH’s new agreement with AT&T.”

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