Dish Network rejoins EchoStar as it tries to compete in 5G

EchoStar Corporation announced today that it finalized its purchase of Dish Network on the last day of December. Following the merger, which the companies announced in August, Dish is now a “wholly owned subsidiary of EchoStar,” and why? 5G, dear reader.

Dish Network was known as EchoStar until 2008 when it renamed itself to Dish and spun its satellite internet business off under the EchoStar name. In recent years, Dish has been pivoting to 5G after buying Boost Mobile and starting Project Genesis, which, in concept, would offer a fourth large network to compete in the US with AT&T, Verizon, and T-Mobile. As of late 2022, when we last tested it out, it wasn’t quite impressive yet.

EchoStar’s COO, John Swieringa, said in the release that combining technology, operational, and engineering resources would “uniquely position EchoStar to provide a compelling global offering that connects consumers” to internet, wireless phone service, and streaming, on top of the companies’ enterprise and government services. EchoStar board chair Charlie Ergen similarly said that, together, the companies will “offer an enhanced consumer connectivity business.”

The FCC noted when it approved the “unusual” deal on December 6th that because of Ergen’s stake in both companies — he has more than 90 percent of the voting stock of both, and more than 50 percent of the equity — their combination would represent “no substantial change of ownership or control.” Basically, it’s more akin to Ergen combining bank accounts than an ordinary merger, and the FCC believes letting the deal go forward would “serve the public interest, convenience, and necessity” under the Communications Act of 1934.

Dish announced in June last year that it had met an FCC deadline to cover 70 percent of the US population. The company will have to hit 75 percent coverage by June 2025 to meet its next regulator-set deadline. The merger gives Dish, which hasn’t been doing well financially, access to EchoStar’s coffers and a better chance at hitting the next deadline.