Don't Count Out Dish Wireless, T-Mobile CEO Tells Analysts
T-Mobile CEO Mike Sievert shot down a question during the company’s analyst call Thursday (see 2304270079) on whether Dish Network will soon be in a position where it has to sell its spectrum to the highest bidder.
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“It’s becoming more and more openly discussed that Dish may eventually be a liquidation story,” MoffettNathanson’s Craig Moffett said near the end of the call. “If that were to happen and if the FCC were willing, how much appetite do you have for more spectrum?” he asked.
“I don’t count Dish or [Chairman] Charlie [Ergen] out very easily,” Sievert replied: “I have known him for a long time. So I think it’s a premature question.”
Sievert was also asked if Dish seems likely to exercise an option it got as part of a complicated arrangement on T-Mobile’s buy of Sprint to acquire the company’s 800 MHz spectrum. “The way our consent decree works is it’s entirely up to them,” he said: “We are here to support them, and so we will wait to hear what they decide. I am in touch with Charlie.” If not, the spectrum would go to auction and “maybe be in the hands of someone else,” he said.
Moffett told investors Friday T-Mobile is performing well but faces the same struggles as other carriers. “We’ve long been adherents to the idea that industry matters most,” he said: “Right now, the industry is an inhospitable place. Growth is slowing and competitive intensity is rising.” Like AT&T and Verizon, “T-Mobile’s growth metrics are all slowing” and most of its metrics “were just a touch light,” he said.
As the FCC looks at the potential use of 12 GHz spectrum for fixed wireless (see 2304270077), Sievert emphasized the importance of the company’s home internet offering. He projected as many as 8 million customers for the service. T-Mobile is “essentially selling excess capacity on our network” based on mapping,” he said. “We have created a nationwide mapping of every household in this country, map them to every sector on every tower and determined [in] which sectors no normal amount of mobile wireless use will take up our rapidly expanding capacity -- and that is where we approve applicants for high-speed internet on 5G,” he said.
Sievert sees the wireless industry as having a “rational level of competition.” Some of the offers from cable companies and others “have been eyebrow raising, but they pulse in and out,” he said. Sievert acknowledged T-Mobile postpaid phone churn was 0.89%, but it’s not the lowest in the industry. “We have the best network and the best prices -- that means we should have the lowest churn,” he said.
T-Mobile remains confident it will cover 300 million POPs with its Ultra Capacity 5G by the end of the year, but the last 25 million or so are the most difficult because of geography, said Ulf Ewaldsson, president-technology. “As a rule of thumb” coverage is “about three times harder for every 10 million that you add,” he said: “It’s very easy when you start out, and it gets harder and harder.”
Chief Financial Officer Peter Osvaldik said T-Mobile’s sale to Cogent Communications of its long-haul fiber network, announced last year (see 2209070039), “is progressing very smoothly,” led by a team from Cogent.