Dish Network needs to aggressively respond with an M&A move in the wake of AT&T’s $85.4 billion bid for Time Warner Inc., Chairman and CEO Charlie Ergen said.
“To be successful, you need wireless spectrum, you need scale with video and you need a network. AT&T has that … That becomes a bit of a threat,” Ergen told investors during Dish’s third-quarter earnings call today.
Ergen said Dish is “uniquely positioned” to challenge AT&T. “We have wireless spectrum, we have scale and video, but we don’t have a network. You can imagine all the interesting things that are going to happen once this current auction is over. If someone is in position to put all the pieces together, it puts people on the sideline in position to do something. You can remain on the sideline, but that would be malpractice.”
Dish notably flirted with T-Mobile US last year. But the type of arrangement Ergen envisions this time around remains unclear.
“We don’t know the answer to that,” he said, alluding to a range of Dish assets, which include everything from a growing live streaming service in Sling TV to a sizable collection of wireless spectrum. Perhaps someone might acquire Dish?
“We’re a midsize communications business,” he added. “We don’t get to make all the decisions. Somebody might do something that opens up an opportunity for us … AT&T-Time Warner right be the change element. It might be a catalyst for change, so we’ll see.
Ergen was asked repeatedly by media members today about the impact of a shocker presidential election, which saw Republicans sweep into the White House and Congress.
In a nutshell, his answer suggested it was too early to draw conclusions, but he said he’s optimistic about what will surely be a less regulatory regime. “It certainly is possible that with new leadership, all net neutrality might go away,” Ergen suggested.
Simultaneously, however, he said that deregulation might not always be a good thing. “We already have concerns with AT&T and potentially DirecTV now about zero rating on AT&T networks,” Ergen said. “I think that’s a violation of net neutrality.”