Dish Network Dishes Out $25.5 Billion Bid for Sprint Nextel

By Chris Preimesberger  |  Posted 2013-04-15 Print this article Print

Survival of the Fittest?

A Dish-Sprint merger could turn out to be a long-term survival mechanism for both companies.

"This is one of the few ways that both companies can survive the shakeout being driven by bundles," Rob Enderle, principal analyst at Enderle Group, told eWEEK.

"Comcast, AT&T and Verizon are all providing bundles which include telephone and cable," Enderle said. "Bundles are how Microsoft drove out the competitors with Microsoft Office, and they tend to force out the companies that can't bundle.

"With this merger, and using technologies like WiMAX, the combined companies should be able to provide compelling alternatives to these competitive programs; without it, both firms have little chance of long-term survival," he said.

Sprint said in a statement that it would "evaluate this (Dish) proposal carefully and [consistently] with its fiduciary and legal duties. The company does not plan to comment further until the appropriate time."

Dish Network provides satellite television, audio programming and interactive television services to commercial and residential customers in the United States. As of March 2013, the company provided services to about 14 million subscribers. It employs about 34,000 employees—with more than 25,000 of them located in the United States.

Sprint Runs Other Wireless Brands

Sprint Nextel, based in Overland Park, Kan., operates multiple wireline and wireless networks serving 56 million consumer, business and government customers in the United States, Puerto Rico and the U.S. Virgin Islands, primarily under the Sprint brand. Sprint Nextel, through its various subsidiaries, also offers wireless services under the Boost Mobile, Virgin Mobile and Assurance Wireless brands.

Sprint Nextel expects to face even more competition in the future because the parent company of T-Mobile USA, Germany's Deutsche Telekom, is inching closer to a multibillion-dollar agreement to buy MetroPCS. That acquisition could be weeks away.

SoftBank has operations in broadband, fixed-line telecommunications, e-commerce, Internet, IT services, finance, media and marketing, and other businesses. SoftBank was established in Tokyo in 1981 and had a market capitalization of about $47 billion.

Chris Preimesberger

Chris Preimesberger is Editor of Features & Analysis at eWEEK. Twitter: @editingwhiz


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