Dish Names CEO as Ergen Turns Focus to Wireless -- WSJ
December 06 2017 - 3:02AM
Dow Jones News
By Drew FitzGerald and Imani Moise
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (December 6, 2017).
Dish Network Corp. said Tuesday that Charlie Ergen has
relinquished his role as chief executive to focus on the company's
fledgling wireless business.
The company promoted its operating chief, Erik Carlson, to the
CEO post and made other executive appointments, including a head
for its traditional satellite-television business and one for a new
division holding Sling TV, its online-only pay-TV package.
The reorganization comes as Dish's satellite business bleeds
customers, pressuring its earnings. Also, investors have waited for
years for the company to find a profitable use for its trove of
wireless-spectrum licenses. The Englewood, Colo., company has spent
more than $21 billion over the past decade to assemble airwaves it
could use for its own wireless network or to sell to another
carrier.
Mr. Ergen, who will remain chairman of the company he co-founded
in 1980, previously sought deals with major telecommunications
businesses to pair their networks with its spectrum but hasn't
found success. Earlier this year, he said it could be a good time
to strike a deal, in light of what he called a "more friendly"
administration when it came to mergers and acquisitions.
That outlook was complicated by months of negotiations between
wireless companies Sprint Corp. and T-Mobile US Inc., talks that
came to an end last month after both sides reached an impasse over
ownership terms. The telecom industry got another shock a few weeks
later, when the U.S. Justice Department sued to block AT&T
Inc.'s $85 billion purchase of Time Warner Inc., arguing the
combined company would have too much power over video distribution
and innovation.
The department's lawsuit, which AT&T and Time Warner have
vowed to fight, tweaked some assumptions about which potential
combinations might raise antitrust concerns. Some analysts said the
department's arguments, which lump satellite service in with other
video-distribution methods, could make it easier for AT&T,
which owns DirecTV, to buy Dish's satellite-TV unit. Including
streaming-only accounts, DirecTV has about 21 million subscribers,
topping Dish and Sling TV's 13 million.
On the wireless side, Dish could still dig in for the long haul.
Executives have been laying the groundwork for an "internet of
things" network that could serve internet-capable cars, home
devices and other gadgets, but they say it would take years to
build. The company will need to run a wireless business covering a
significant amount of the U.S. by 2020 to meet federal obligations,
or risk losing its spectrum licenses.
This is the second time Mr. Ergen has stepped down as Dish CEO.
He left the CEO post in 2011 then reclaimed the position in
2015.
During his most recent stint as CEO, Mr. Ergen launched Sling
TV, the first online live-TV service created by a traditional
pay-TV provider to attract cord-cutters.
AT&T said Tuesday its rival to Sling TV, DirecTV Now, has
more than 1 million subscribers after a little more than a year.
Sling TV doesn't disclose how many paying customers it has, though
several analysts estimate the service has well over 1 million.
Dish Network shares rose 0.8% to $52.03 on Tuesday. The stock is
down nearly 10% so far this year.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com and Imani
Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
December 06, 2017 02:47 ET (07:47 GMT)
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