Q2 2021 DISH Network Corp Earnings Call
Okay.
Good day of welcome to the Dish Network Corporation quarter..2 2021 earnings Conference call. Today's conference is being recorded and at this time I'd like to turn the conference of 2 Tim Messner. Please go ahead Sir.
Good morning, everyone. Thanks for joining US we're joined on the call today by Charlie Oregon, Our chairman.
Erik Carlson, our CEO, Tom Cullen EVP of corporate development, Paul Orban, our CFO and on the wireless side, we've got Jeff Blom, our EVP of regulatory affairs, Steven by our Chief Commercial Officer.
Dave Mayo, our EVP of network development.
We're not going to be making any opening remarks today, but we will start with this the interest safe harbors.
Statements that we make during this call that are not statements of historical fact constitute forward looking statements that are subject to risks uncertainties and other factors.
Could cause our actual results to differ materially from historical results of indoor from our forecast we see no responsibility for updating forward looking statements for more information. Please refer to the risks uncertainties and other factors discussed in our SEC filings, that's it and with that operator, we'll open it up to questions and let's start with the analysts.
Thank you if you'd like to ask a question. Please signal by pressing star 1 on your telephone keypad, if youre using the speaker phone. Please make sure. Your mute function is turned off to allow the signal to reach our equipment.
Again I just wanted to ask a question Paul Paul just for amendment to a lot of it from the change to signal for a question. Thank you.
Now we will take the first question from David Barden of Bank of America. Please go ahead.
Hey, guys.
Good morning.
Afternoon, Thanks for doing the call yet I get the couple of questions if I could.
Congratulations on the on the AT&T network services agreement.
Obviously theres the verdict.
Talk about it I would love if maybe it's probably you could give us a little background on how that deal came together why it came together and I think specifically.
Is this a vehicle for dish to achieve it.
It's the FCC coverage requirements.
Specifically, the 70% coverage by June 2023.
I think the second question I would have is.
Obviously, we're we're obviously waiting for the Las Vegas.
Network launch.
I was wondering if you could kind of give us a little bit of a roadmap.
Between now and say you know maybe first half 2022, what the network build.
It's gonna look like and what should we what we should expect I guess some of your partners in the in the infrastructure side of that suggested that you've been.
Kind of putting a broad geographic build in and it'll be great to get some more color on that thank you guys.
Sure, David David I'm going to I'm going to have.
David maybe I'll talk about your second question on deployment and how that looks in.
And then maybe just an opening comment.
Comment and throw it over to Steven by on the.
AT&T question, but the but.
Obviously, the we're always looking for ways to.
The improve.
Thanks of our customers and it's no secret that the CDMA shut off a freedom of shared the framework premature shut off.
From T. Mobile was was not helpful to the relationship. So there was an opportunity for you know 1 of their competitors.
The to work with us.
And.
And so that led to discussions that probably otherwise might not or might not have happened but that.
But make no mistake T mobile soup sales super important to us.
And we're happy to have 2 really good companies that we could that we can work with the.
The the.
Jeff.
It doesn't help us.
The AT&T or T mobile in the 1 of those agreements do not help us without did not help us in the CDMA shut off.
Timeline and they don't the AT&T doesn't help us in terms of meeting.
The FCC milestones, so, but what it does but I do think the.
The agreement with AT&T is.
From a big picture of certainly moderately I, let AT&T speak for themselves, but I view it as certainly moderately positive for both companies and potentially extremely positive from both companies and with that maybe I'll turn it over to Steven and maybe give you little more color on it.
Yes, so just to add some more color out of Charlie's comments.
This is a as you've seen our long term strategic partnership that we have with AT&T.
Really we went into it with sort of a win win approach for both companies. It suddenly creates value for both of us.
Which we feel is very important as companies, but also for our customers and so 1 of the things that is very important in this relationship is the quality of the AT&T network.
As it relates to supporting our customers in particular of dish customers. The SKU 10 tend to skew more rural so they have a much better network and the quality of network and reliable network in that in those markets.
It allows us to go beyond our existing footprint that we serve with boost today too.
To broaden our distribution and address a different part of the market given the quality of the network and the coverage I think the other part of the relationship as you know beyond being strategic because it is of long term partnership and we've been working with them on how we manage the customer migration as well as the support for those customers both on our <unk>.
Network as well as the AT&T network, but in addition to that also with the T Mo network.
And so it is a good relationship and in 1 of the where are we.
Working towards operationalize them as we go forward and the other thing to add in the relationship with AT&T is it is a broad writing agreement. So it does give us in market roaming in addition to out of market range for a long time.
As you've seen at the 10 year agreement. So that's very important as it helps to support our build but it doesn't remove any of our obligations on the build and so with that I'll hand, it today great.
Steven David with respect to our build program you might be of where we've implemented a very decentralized approach we have 4 regions.
The 36 markets and the early markets that we'll be building or substantially all of co locations. Hence the you know the.
The activity that you saw in some of the tower company.
Calls this last couple of weeks.
You know in that regard we've signed substantially all of the leases that are required to meet our 20% mandate for ex the next June and have received notices to proceed on close to a third of the sites.
As you know we've commenced construction on.
<unk>.
Close to 30 markets.
The 30 geographies within those 36 markets. So in some cases, there may be multiple geographies within a market that we all of the will the we've commenced construction on and then.
The as to your Vegas question will be substantially complete with the construction activities.
This next ex.
The 60 days.
By the end of the third quarter, and we will as we've talked about will be beta testing customers of the fourth quarter.
Great. Thank you guys sort of so much for the color.
Well now take the next question from John Hodulik UBS. Please go ahead.
How quickly will we will you guys be able to migrate the traffic from the the T mobile network to the AT&T network.
I guess, the all new gross adds go up right on to the AT&T.
You know network and then.
Part of the the announcement you talked a little bit about.
Cooperation on the infrastructure side could you talk about the weather AT&T will be helping you guys light up spectrum I know they they would.
The 700 in particular fits well with what they're doing with their their blocks of 700, and then lastly on the on the Las Vegas launch just anything you could tell us about what that will look like once the network is the lit up all of you guys have sort of retail pricing plans in the market or.
Now when you sort of the.
Establishing a sales force to talk about distribution and the wholesale side and the business side or just sort of what should we expect when the once that network gets turned off thanks.
Yeah. This is Charlie.
Tried to take some of those maybe somebody else will want to jump in.
In terms of the transition from AT&T I mean, obviously you know.
The AT&T will be our primary.
Partner.
On the M D&O.
<unk> going forward.
But that doesn't mean that we're transitioning all of our customers off of.
The T mobile they again remain an important.
Part of what we're doing the to the extent that they want to be an important part of of what we're doing so 1 of the things that we'll do that relate to Las Vegas, There's obviously, we have to the to.
To be able to to the provision on AT&T. So that's going to take us a bit of time.
That would hope maybe somebody else from Scott, maybe 1 of our guys can talk about that and.
Obviously, the the some.
<unk>.
Well want to want to move the AT&T gets the better network.
Some people they are.
T mobile network will be better and I want to stay where they are and then from new customers.
Big picture kind of thing is.
Our.
<unk> today.
And for the most part I think most customers across the United States that we talk to they really want consistency.
And coverage as the.
The priority.
And thus the speeds of <unk> LTE are normally fast enough for them and they don't really see a difference of <unk> when <unk> pops up on the phone so they're a little confused nobody can charge more for 5 G in United States today.
And so.
Obviously for a new set of customers for US we think the ATT network.
It is a tremendous coverage advantage that we don't have today, although the T mobile is going to be of basketball over there as they build out rural America per their FCC milestones. The other part of it is the but the T. Mobile today, probably arguably has the advantage of certainly in perception of 5 G and probably in <unk> build out of our 600 Meg.
The Hertz and while it doesn't really show up.
Is it particular feature on you know the customers can can point to it's still from a marketing perspective I think they are considered the the leader in <unk>, That's where 5 day is important for our customers that's going to be important the cave is going to be the <unk> development both of our own development, which we think we're doing a little bit differently, but also as you get as you get.
The the big 100, megahertz blocks and C band or $2.5 of the team all of those of building out that is going to be a real race for those guys in and we'll see who does the best job of building something that can differentiate differentiate <unk> to the consumer that that'll be the key but we're well positioned with both T mobile and AT&T dependant on the hook.
Kind of wins that raised plus what we think that we're going to do different it within <unk> and our architecture that might be different than either 1 of those too so.
You know, we're just well positioned when you get the customer of the the the the network that they think is the best coverage and quality and value for them.
But AT&T is going to get the the.
Hum.
The the primary going forward the.
The other.
With AT&T in terms of.
Steven touched on it but there's other things beyond that.
It's probably moderately positive from both companies, but it could be extremely positive of you mentioned 1 spectrum, we have we have spectrum.
Both have 7 mirror images of 700 megahertz or might be some interesting things you could do there.
And save some some of them and get scale and save cost.
These are so inclined we share an interest in the 12 gigahertz spectrum, we have some spectrum debt as we build out will lay fallow.
We're a bit until we build it out.
And it probably could be put to use the sooner rather than later by AT&T.
So I think Theres, a theres technology, where things are going are the that our teams of committed to working together on and where we were buying other services from AT&T like backhaul debt, we have to buy it from somebody in the sense of our partner now they they get the benefit of the doubt on the a lot of those deals.
So and where both of the video business and and we have common interest. There. So you can see this could this potentially could be of.
A much better deals of the $5 billion of that we're committed to it may not the company that may not get along but.
I think both parties I realize that there are things that we can share of that are beneficial to both companies and when we can do that.
Well, what I'm sure will remain frenemies will well, we obviously, we compete with each other.
As well and then as far as I forget the question about Las Vegas, it's more of distributor distribution of distributions yeah, just 1 of them.
What the what the surface of it looks like when you guys turned that network on or is it is it gonna be of beta for the rest of the year or do you actually start adding customers do it no I think will be in beta for a minimum of 90 days.
You got to realize the kind of the things that have changed maybe in the last 6 months, but we.
We're gonna put our network in the cloud or core and the cloud and start that way.
Even though we have a core of working today it does not in the cloud.
We decided we don't want to change and we will.
We want to put the net start with the core and the cloud which hasn't been done by anybody.
Here the 4 we obviously are a day.
Doing O ran so are the baseband and radio vendors have to make sure those things work together and so and the M and now we're adding the AT&T.
AT&T, our integration to the network that we hadn't planned on doing in addition to the integration of of T. Mobile. So we got a lot of them. So we think that's going to be a at least the 90 day kind of beta.
The integration of things work in the lab today, but when you take them out of the lab and we get them on Dave's network that'll be deployed by the end of September.
We can light up the Vegas and total debt.
Debt is that goes from the from the.
The lab to reality in my experiences.
Things don't work exactly right the first the.
First of month or 2 and you've got a great day, but and then we'll go from there. We will have retail you know obviously in Vegas. It is in other cities of the light up very quickly after the Las Vegas.
Well have a retail presence and will have offers for consumers that we think will be competitive.
Yeah. Thanks Charles.
Well now take the next question from Jonathan Chaplin, New Street Research. Please go ahead.
Hey, guys, it's actually still Barnett for Jonathan.
Quick 1 will the end market roaming element of the AT&T deal lead to a more efficient and quicker network builds of you guys I understand that it will change the FCC requirements, but it does it change the way you think about the delta.
Thank you.
Yeah, So I'll start and then I'll, let Dave wrap it up at the end market roaming is important in terms of the customer experience and the ability to manage our customers, but it really doesn't impact our the bill plan that Dave and his team of working on and all the day, Yeah. We want we're not doing anything differently.
As a consequence of the AT&T deal with respect to the.
Many of our FCC milestones.
Yeah.
Got it.
Yes.
Yes.
From now take the next question from Phil Cusick Jpmorgan. Please go ahead.
Hi, guys. Thanks, Charlie you alluded to this with the AT&T comments, but any updated thoughts on the D. B S merger of out of the Directv separated does that separation change anything and and what's lost as time passes and then just quickly as well what's the exposure on the CDMA shutdown still thank you.
Yeah, you know in terms of Directv and dish I mean honestly I've I've said at the last year I think that debt.
Those 2 companies go together that's inevitable.
Hum.
Really you know if there's another party involved in terms of TPG, so whether that's positive or negative items I don't know.
But from a regulatory point of view.
Obviously, there's less and less reality to objections to it because obviously that the the the.
You know of hundreds of billions of dollars of broadband deployment and continued competition from the programmers themselves are in the marketplace. So am I I think I think that's just well just have to wait and see what the whether there's.
The desire on everybody's part to do that but I think it's the timing issue more than the than anything else.
In terms of I think the other question was CDMA shut off yeah.
Like I said early this year that that wasn't the that's the that's kind of of false.
T mobile it head the Undrawn talked to regulators in California that they would be a minimum of 3 years.
I think theres kind of of I think it's of false artificial deadline to turn it off in January of this year.
We view that as the very anti competitive move because that's the situation where the.
The people that we wrote the we pay that.
The debt our partners from many of them, but you know, we're actually obviously challenging oh outwardly challenging to get our customers and that was of a convenient way to do it you may notice that they they've got them and I think the kind of smoothed out now right. They are extraordinary offer in the marketplace for a free upgrade to a <unk> phone and.
50% off per service.
For 2 years of extraordinary offer so that's obviously aimed at at at customers to upgrade to the their network and you know I think the the you know that's not you know it's.
It's.
The bottom line is that you know the.
They're really sort of what I call sort of winters you know it's it's.
It's hard to be of good winter sometime in <unk>.
And they've got $70 million of synergy the government.
$70 billion of synergy of the government allowed them to have an and and now the 171 billion right by getting some customers that we already paid them for so.
You know and you know you've all met that Guy in grade school.
Wanted to brag about himself of Brad how good he was in spike the ball in front of you and you know that the.
Sometimes it takes a bit from maturity to be of good winter and and in there kind of is there sort of winter and so it's it's it's it's but it's good on the other hand it. The fact that the consumer get upgrade debt that they may not be good for for for boost but at least the customer of our main objective of the dish and boost just to make sure.
The customers don't lose their service and to the extent that the customer upgrades. So that's.
And doesn't lose their service I'd much rather have that the then the customer lose the service. So you know I think there I think the you know we expect that they'll continue that promotion through January 1st I think the they probably but they've been in the business day. They went on television. There's the went on TV instead that nobody would be impacted that everybody was going to be upgraded by January 1st and.
I expect that they're going to continue that promotions are going to upgrade everybody by January 1st of and if they do that the then there's probably no controversy oven.
The other competition.
But you'll have to wait and see how things go.
How many customers do you still have it would be exposed to the CDMA shutdown Charles.
Well I think our last disclosure was was the majority of our customers of Florida was that a quarter ago, but majority of haircut of customers at debt debt that we are making.
We are taking all reasonable efforts to migrate.
The migrate customers and we made good progress on that so the so that people.
You know don't suffer from a pre merger of shut down and I think the the number is now a smaller but I would say this debt that our projections show a material amount of customers on January 1st of all still.
Hum CDMA phones.
And we will lose their service and again this is the most economically.
The Challenge group in America boost is not the these aren't the the customers that have bank accounts and and.
And the high paying jobs in and the these are people that that are challenged and so economically challenged so I think it's even more important to these people don't lose the service.
Thanks Charles.
Well now take the next question from Doug Mitchelson Credit Suisse. Please go ahead.
Thanks, So much of a couple of short ones and then 1 for Charlie in terms of the NSA and AT&T requesting to use portions of the dish spectrum.
With the 18th T be able to use that dish spectrum to serve their own customers. In addition to the Serbian dish customers. The reason I ask of the language in the 10-Q wasn't quite clear sense of noted a T T would be able to deploy the spectrum to support the dish customers. So that's the first quick 1.
I'm Gonna, let Steven answer that yeah, so Doug the the basically ATT can deploy that spectrum for not just our customers, but for all customers on the network and part of the reason we looked at that was you know as we load up capacity on their network is just making sure that our customer experience and the customer experience.
<unk> continued to be a market leading.
Okay. That's clear and then given the Las Vegas Wireless network coverage. You are building would you anticipate what would you anticipate with the customer usage in the Las Vegas area on the dish network versus needing to roam on AT&T or T mobile.
Yeah. So the majority of the usage will be on our network and the complemented by the coverage and the and the network that we have access to with AT&T.
Okay. Thanks, and then Charlie I was just hoping to get you on longer term capital needs. Maybe this won't go anywhere, but you've talked in the past about achieving the Oran and and now I guess cloud core proof of concept as a driver of cheaper access the capital for dish.
At this point are you contemplating the wireless strategy. That's aggressive enough that you think you will need I'll take capital I know you've talked about self funding the most or all of of the sort of phase 1 initial build but I imagine you've got multiple scenarios, where you could be a lot more aggressive with spectrum of customer acquisition pace of build and other things.
To go out for wireless you know quickly where you could go after of wireless that are at a pace that you can afford with just internal capital of any thoughts on accessing the capital in the future post the post of Las Vegas.
Well I mean, I think I think historically, we've accessed the capital markets or you know are 40 year history. So I don't and obviously, we have obligations we need to pay back. So you know we continue to well as always we're opportunistic in the capital markets.
If the if there's a reasonable ways to raise capital and and we plan our business.
Accordingly, the you know and you know.
We've been pretty innovative and obviously, we've never we've never had the kind of capital that some of our competitors do and so we've had to be more innovative and I think that we're comfortable net in that space and.
Debt.
But you know we have the capital to the I think Dave sleep at night, knowing that he has the capital available to the Mi his deployment guidelines.
You know for now and obviously, Eric is running the business in a positive cash flow manner. So.
But the but if there's opportunity out there.
Or what was the other with partners or with with the the markets themselves.
Let's take advantage of those things.
Maybe maybe I could try it this way Charlie is there sort of a line of sight on you know you know this network will take you know 4 to 5 years to build and it'll be in a pretty good place. It's going to take 10 years 15 years is there sort of a sense of time to get you know stand this business stuff and get it running in the way that you like.
Well I mean, I think I think where we're less than 2 years away from critical of what I would tell of critical mass where kind of you know we're going to cover 70% of of the country.
Next 2 years.
The population and that's critical mass where we're.
Where that's that's that's that's enough critical mass that that's on par with where sprint was and I think they had 50 or 60 million customers. So.
And we're going to have a better network the.
Then they had and we're gonna of a differentiated network, so and better roaming.
The brand had so.
This isn't a 5 year project. This is I think the.
You know obviously, the first milestone of 20% I think you'll have a pretty good feel and you'll be able to we'll be able to start helping you develop models of where this goes but clearly the 70 per cent milestone well will.
It will be enough to compete.
The high level.
And the marketplace both for consumers, but it may be for you in our case more importantly for enterprise business.
Alright, Thank you I'm looking for that Las Vegas pricing that'll that'll certainly help with the model. Thank you.
Okay.
Yeah.
Well now take the next question from Brett Feldman. Please go ahead.
Thanks, It's actually a follow up to exactly what you were talking about for a while you have flagged the enterprise space as the key opportunity for the advanced capabilities of the network of your building you've talked about network slicing and even private networks you know typically in the enterprise market, particularly when youre deploying infrastructure in.
Lance 2 of customer win it's not uncommon for those enterprise customers to help fund the deployment of that infrastructure. If the large upfront payments are you contemplating the dad is a part of how you're going to fund the business going forward meeting as you think about that $10 billion budget. You outlined is it plausible that some of that could be financed by enterprise.
Customers and any of the flip side of the question would be if that's not the case how are you thinking about pricing your services in the enterprise space, particularly when you're deploying network in response to contract wins. Thank you.
I'm at those other Steven other than say that the debt I think theres a lot of models in the enterprise business.
And <unk>.
You can imagine are enterprise customers, who want a slice of the network and they want a certain level of quality in and they wanted to have happen and the geographic region that debt. We haven't built out they want built out of that you can you can you can certainly your scenario you know certainly plausible Oh are you can imagine.
Just straight business deals where people pay by the pay by the drink or paid by the gig and and Hum, but all of that I think the broader answer is all of that Steven answers really.
So why the architectures that we're building is so enticing for enterprise customers and why of differentiation maybe from what they can get with the incumbents.
So adding to Charlie's comments, you know, we're seeing significant traction in the interest today in private networks and private <unk> networks and the architecture of that we're deploying really enables the level of control and a much deeper level of security that allows the enterprise to utilize that network for their own business operations.
So are we seeing significant interest there are we've been responding to multiple rfps RFID. We're working on proof of concepts right now and are you know we're partnering with the number of different size as we bring the services the market and so there are different business models, depending on the customer depending on the geography.
The and the good thing about these private network. So we're working on is they're not constrained by the geography of building of macro network. So we're able to serve customers in different geographies are within that environment and then the other thing which is also important to highlight its across all verticals. There isn't a specific vertical that has an interest in this we're seeing interest across.
Every vertical and every industrial segment them and we're very well positioned to take the architecture the way deploying being cloud native but also the open architecture of the ability to do slicing. It is distinctive the unique compared to the what the other operators are having the market today.
It's not to say that they can't get there in the future, but we clearly have an advantage today that we're taking advantage of them I think it's also important debt to add day, even in the dish business. Today, you know, we do a great business instead of being hospitality.
And so we're able to partner with them the systems integrators, we have within that business to augment what we're doing all of the video side and so that's really a terrific model, where we can integrate kind of the capabilities of the assets that we have across the whole company.
To serve other verticals as well that some people may not have on our radar screen today.
Thank you.
We'll now take the next question from Craig Moffett. Please go ahead.
Yeah, Hi, thank you.
Let's stay with the same topic, if we could Charlie the the enterprise market today is mostly national sales of 4.4 devices that really arent.
The similar from the the consumer market, but I think what youre describing is quite different can you talk about some of the the particular opportunities if not by vertical and by applications.
That you see in the enterprise market that you can uniquely serve and and how large do you think they are of businesses and and which ones in particular, you envision being regional rather the national sales because I think a lot depends I guess on on whether companies are interested in buying.
Services that are really on a much more localized or regional basis wirelessly than they are today.
Yeah.
Yeah.
And Steven May jump in here, but let's take the colors. There clearly are national enterprise the.
Areas, where we wouldn't be.
The components of that today, but there's but there's but even with the national companies theres much there's very much of it that's the localized so you can imagine the.
Net.
The hospitality industry, where that your hospitality of localized.
But in the hospitality industry Youre going to differentiate yourself from your customer service because that's the hospitality industry and you wanted to you can do that in the market by market.
Basis, you can imagine things like Miami right that arent.
And then the private networks and they probably have to get built those are probably not in anybody's foot footprint today on the on the other extreme so there's just a lot of different areas, there and I I would contend dragged it.
But the profitability on a per bit on a per dollar.
Dollar of Capex and the per per gig basis is going to be kind of be much higher.
And the enterprise business Center, where all of the consumer business the.
The consumer business it is quite competitive.
And with 3 big players in the us entering the marketplace.
So it's quite competitive enterprise business day.
Each company as you kind of have different needs and in some cases, we won't be able to fulfill those needs..1 of the other 3 carriers will be able to debt, but in many cases, we're the only guys that can really in the foreseeable future fit their needs are and that's going to be a good business for us and those are long term contracts.
They are long term sales process. So you know from a revenue perspective, youre not looking for that to be big revenue out of next year.
But.
You know peripherally, we just know by the interest at the Theres never a conversation with the company at high levels, where they don't want what we're building I guess, that's the way I'd say it we may not be the right company for them.
It may be 1 of our competitors that is better suited but they want where the where things are going in and you just can't get there with what the legacy networks, because you have to automate.
And the automate you have to be in the cloud.
And we're gonna be there and then O ran nobody wants to build.
You know last last centuries.
Network, they want to build the <unk>.
21st century network in and that's what we're building and so that's where people are going to spend their money from an enterprise perspective or kind of want to go.
And it adds up to that.
Uh huh.
Sorry, I would say if I can ask a quick follow up.
Do you envision, bringing the same capabilities to wholesale markets and a 4.4.
Being in network provider for other MB of nose, and and are there any limitations under the AT&T agreement and Youre doing that.
There's no limitation in the in the AT&T agreement to I mean, you you could imagine debt if another another network provider of let's take AT&T since the since obviously, we have of long term relationship now.
And they wanted the wholesale from our network because they had an enterprise customer.
And we had maybe some architectures that helped him get there that's an interesting conversation to have because we both of them win and again I've said that for that side of it for 2 years now we're interested in working with those companies.
What we how we define a partner working with companies who want to help our company to get better.
And we're gonna in return they should expect that we're gonna help their company to get better.
And that's not always the way business works right. So you know some some companies at the zero sum game.
Where Iran, and the only if I win and you lose am I willing to do a deal and.
No no I understand that I brought up 30 years ago that probably sounded like me.
Hum.
But you know I'm kind of a gentler now as people ramping up.
At least that more and more experienced some arbitrary list of it that way and I think I, just think debt, particularly capital intensive industries.
That.
Where people can where people decide that they can take the take the approach where a more of a partnership approach that I think that's the competitive potentially competitive advantage.
And I'm you know I'm, sorry, we're sort of conceptual Craig you know at this point, but that's all of those concepts.
Turning into real business models.
That ultimate you can you can you can you can see the cash flow generation in the future.
You know strategically where kind of my job strategically is to make sure that the concepts can then turn into that.
Okay.
That's really helpful. Thanks Charles.
Yes.
Well now take the next question from Ric Prentiss of Raymond James. Please go ahead.
So a couple of follow up questions. Obviously, the lot of discussion on the envy of no agreement.
To provide the best network to your customers could it make sense to do other network sharing agreements with people that have that are networks of the Liberal America, the maybe AT&T or T. Mobile have you maybe of U S cellular relationship that makes sense maybe.
The answer is yes.
The debt that we're not maybe 1 day.
Would we be prevented from doing something on the U S editor for of the AT&T agree no no. We're not prevented and in fact, we've talked to a number of regional and rural operators about how do we do things.
To Charlie's point earlier about partnership how do you do it in a capital efficient way the both parties benefit. So we've had a number of those conversations.
It certainly makes sense yeah. So you can imagine that part of our rural strategy would be worked with those people that are already in rural America.
Now AT&T.
As much of geographies as they cover which is a lot. They still don't cover they're still rural carriers and including U S. Editor the cover areas that AT&T does not our T mobile does not.
Makes sense second question mentioned on Vegas stays busy at work there are the.
Consumer beta trial.
How should we think about why not of wholesale enterprise phase of trial or is that something that would also the occurring in the in the fall with the timeframe.
Yeah, we're in active discussions on enterprise and wholesale you know not all wholesale is national.
And a lot of business services, all local and so we are actively pursuing a number of opportunities not necessarily just in Las Vegas, either for that matter.
But I would say at the being the bars, a little bit higher of the bars, a little bit of hiring enterprise business in terms of quality.
And we're going to we're going to walk before we run so I wouldn't expect that enterprise happens and it just so you know of enterprises of 2022 kind of thing because we gotta get Vegas right first.
The first.
It might make sense of a show of enterprise, what you're doing in Vegas. So they can really see what the no of POG if he looks like.
So well definitely do that as well everybody in this call will probably be of consumer electronics show you, you'll get the you'll get a phone in.
You know I know, you'll do 2 things youll measure speed and you'll see if you drop what he calls.
Exactly right.
Check average and you'll check your speed right.
So lots of moving lots of them from me as you guys have done a bunch of tuck in acquisitions are there other opportunities out there. That's the kind of adds scale into your business and related Shuman Dallas wireless the other T mobile close.
All of US boost must do those boost customers come onto the the play for you guys. If you want.
We always look for we'll always look for any kind of acquisition that makes our company better or any sale, but that we can sell the more beneficial to somebody else than us. So we always look at that.
And then the shot Shannon you want to take that 1 to 1 of them because you know more about the and I do yeah. The Shenandoah of customers were purchased by T mobile.
Okay very good thanks Colin.
We own the brand right yeah, they're operating under a reverse TSA similar to the transition services agreement that we operate with a T mobile 1.
So they're supporting the bousquet, we're supporting the boost customers on behalf of the T mobile in that region.
But the we shouldn't expect maybe of a sale of that to you guys.
Nothing to report there.
Okay, Thanks, guys stay well.
Well now take the next question from Walter Piecyk <unk>. Please go ahead.
Thanks, Charlie the your 10-K of the letter.
Does the Doj sent you guys in early July.
July just curious if theres been any follow up dialogue with the Doj of the FCC and and similarly with Verizon I think also may have interest in and setting up an M. B now with you guys.
Okay.
Well.
Again.
The conversations that we have with regulators absent named publicly disclose like we did purchase material type of business.
You know, we're gonna stay confidential so but.
But I think it's a you know.
We take we take.
We take what regulatory Rentech regulators and regulations seriously right. So you can read the letter from the Doj and obviously you know we're going to continue to take all reasonable steps to mitigate the expected harm.
Now from the city may shut down, but we're not able to do everything and we do think it's an issue and and obviously the regulators are paying attention to it so.
I think thats, probably what they should be doing and I think you know we we all knew we all knew.
When we did the T mobile T mobile sprint, we all knew the conditions that we're gonna be part of the part of all of that agreement, which is all have to live up to them and I forget the other part of your question was the other.
Part of it is basically a variety of use.
Because the you.
And by the way of T mobile on their call claim that you're only paying them are less than 2 billion. So.
Whether it's Verizon or AT&T, just kind of a are you talking to Verizon and then be like how much of the 2 billion do you think remains after 2 years.
Yeah, well I won't get into debt.
Those details Paul.
Paul.
But you know what were large where a lot of Jamie no and if if if Verizon is successful in tracfone.
The acquisition of Trackman the law.
Largest guys out there and you know it's it's disappoint you know this is personal but.
We've been T mobile's largest customer for the last year not named T mobile right and.
Yeah.
I don't know they have been treated like the largest customer let's put it that way.
Richard Chomping at the bid to ask about Sinclair, but let me just get 1 more spectrum 1 in.
The the.
The any agreement you have with AT&T is this going to be in the form of a of a lease or you're just going to basically give them. The spectrum in the make their network work better because I think that band 66 stuff they've.
Of Verizon at least as shown in the past can be flipped on within a matter of days. So how do we how do we.
Conceptualize AT&T using that spectrum into the lease agreement is it for free and how does that work.
Well I think I think first of all of any I think they'd be interested in the they'd only be interested in the spectrum that they could utilize pretty quickly.
In other words, they have the equipment ready to do ex U.
And then like any partnership it would have to be mutually beneficial.
So the companies and.
So far the relationship with AT&T, we've been able to work through those issues.
Got it alright, rich you want to hop on.
Yeah. Thanks Walt.
Charlie Tom I guess.
When you dropped the Sinclair as ours and you you basically said that just sort of given how long they've been gone it sort of felt permanent from.
The press release the sink.
Just put out a press release, saying that they expect their television stations to get dropped.
Due to of Retrans impasse in a week I guess it feels like they're trying to tie our S. N carriage to retransmission consent, which I don't think has allowed I'd I'd be curious like don't they have to treat these separately it seems sort of crazy for your customers, who don't even have the are of since this isn't an artist and renewal it.
Like to be forced as part of of Retrans renewals take on channels that cost of an extra 4 to $6 a month seems pretty crazy for dish without a lot of upside could you just give us some sense of like.
How does the whether this is being tied whether it can be tied in what youre recourses.
Well that's the last the that's a loaded question, but first of all I'm disappointed that they put a press release out the debt that they expect that the the networks to come down since I think we after the August 16th so.
And obviously, many many negotiations come down to the to the wire. So so we're still kind of bargain in good faith and hope that you know disappointed of Dave.
Seem to come to the conclusions channels or coming down.
At this point.
But the good news of our customers or they have other ways to get their channels first of all they watch them less the the networks less and they have other other ways to get to.
To get those networks.
They didn't they haven't had all of those all of those ways in the past and that's it but we're empathetic to the to Sinclair because they are having to compete against their own from their.
Your own content providers.
And we've had to worry about the long term relationship with Sinclair and it's been good net.
And we've been we would we've been able to work through.
Yeah. She used the at least as tough as this 1.
The years, the the regional sports question that realize the Sinclair didnt own the regional sports networks.
When when those when those networks came up.
For renewal.
At the time.
Sinclair of owned it was able to negotiate on their part we don't.
Our customers.
Wanted regional sports had left and so the there was no way that in fairness to our customers we can tax them.
Yeah, and the basic package and tax customers who.
Oh, almost nobody those lap the wonder of regional sports was left out of network, they've gone to somewhere else to get them. So I think theres innovative ways to reinvigorate the regional sports networks. The Sinclair themselves have talked about it and in the direct to consumer product.
So I think there's other ways to do that and <unk> and will.
We will continue to work with Sinclair it to the extent that the wanted to try to work with us and a win win situation but.
But if not they'll.
I don't I'm, not going to speak to all of the legalities regulations.
The Sinclair.
Pretty savvy about those things and so they'll they'll work their way through that but my expectation and hope would be that ultimately.
The company is find a way to resolve.
All of the issues of concern to both parties and if not then we go our separate ways.
We'll work to mitigate debt for our customers.
And just to be clear Charlie when you say work to mitigate those issues or get to a mutually satisfactory you were talking about a deal for the TV stations not to carry our of sentence is that just to be clear.
Well I mean, our folks there's the we don't have any customers, calling us on RSA ends today.
It's the extent the local channels were to go down we would have more than 1 customer call us. The next day and say Where's my local local channel. There's particular market. So our focus is on making sure that.
That our customers arent disenfranchised for the local channels, if there's some opportunity on original sports it makes sense for us.
And.
Sinclair.
Yeah, we're not we're happy to talk about anything that is creative and it doesn't harm of customers, but we're not interest and tax and our customers for when when when when they when they don't watch the channel.
But that doesn't make any sense.
And our customers will understand that and.
And you know it.
If if we would lose got some customers of if the networks go down and some customer just watch the networks.
Hum.
You may want to jump in on the Zurich, but we've been through this before that the.
The impact of the.
Of local channels is used.
It used to be devastating it it's still pretty bad, but not the same and theres other alternatives like rich as you know I mean, this is erik but as you know I mean, obviously viewership on the broadcasters with the.
I mean, we just ended the the Olympics and I think you've done decent reporting on on the viewership on Olympics and you know I think Charlie's point and you know us.
The sympathetic to some of these folks is true I mean, you know other they're also of the competition with the big owners.
I think the.
The.
N B C announced that they're moving you know Notre Dame football game to the Peacock the home opener right. So I mean, you know whether its award shows or whether it's a you know of sports or whether it's you know big Tuna defense like the Olympics, I mean, youre seeing viewership decline.
And so the the the local broadcast networks do become less important for our customers.
And you know and as you know rich I mean, there's other ways to get to get to get the networks right, whether I mean, we've we've obviously helped our customers with the either offer of incentives or new technologies like you know a low cast or you know technologies like you know the CBS all access which is now the paramount or or Peacock right. So.
The kind of depends on the on the customers the viewership habits and some of those are changing.
And thanks, very much I missed it.
You know the customers figure it out the if they get disenfranchise the they'll leave the networks that the that's why Netflix viewership and prime has viewership and Disney as viewership because they get taken down and customers get frustrated and and then as things get online they learned how to they know what the steel at the piracy is a huge problem.
With the online there there's there's not a network you can't get on line. If you. If you savi. So young people already are you know how to get it if they want to watch it so.
But the.
[laughter] is not always the most rational thing to do.
To take the network down from a net no matter. The forget you know going down is not good for anybody.
Let's put it that way, but we'll see what happens.
Okay.
Well now take the next question from Canon of protest at Barclays. Please go ahead.
Thank you.
So Tony on the on the wireless current I mean, 1 part of it is the network that would deadlines.
Which obviously are.
Got some store and in some ways, but the.
The rest of it is the organization build out with respect the scaling of the service and the telecom organizations that are obviously significantly better than where you are in the number of people and so on so.
Could you help us think through how the scaling of the rest of the wireless organization is going and if you basically plan to.
They look at some of the resources away from the DBS business of the wireless business and how you know how long does it take the scale that whole thing up.
In terms of people and the secondly.
Secondly on the specs on the would be great. If you could give us some kind of an update on the thought process. There. It's been awhile since we heard from you on that thanks.
Okay.
Okay.
It won't take US back question on here about the the you know.
Netflix add.
Fraction of blockbuster employees.
Bad debt workout.
I mean, where we built the the.
Now we will.
We had a good base of engineering.
Already of at dish and obviously we.
There's a lot of talented individuals some of which 1 of this golf some of which are not on this call. So.
So we feel and the set of the of.
Of the executives who are working of where things are going not where it's been in the past. So I think and I think theres plenty of resources out there.
And for what we need to do in wireless and I think we can walk and chew gum at the same time in an error.
Yeah.
<unk> is able to.
Ron dish and playing in a highly efficient manner as well as our work on the retail wireless and I don't I don't see of conflict. There I mean, I mean don't get me wrong. It's it's always hard to find good people and it's probably a little tougher in this environment today with the unemployment being low, but when you're building the future.
People with ambition and people who are curious that's where they want to go in and.
We're finding that this is a great place to come work and help them to do something and we're finding the good flow of people.
So operator, we have time for 1 more analyst call before we take a few press calls.
Yeah.
Thank you we'll now take the next question from Michael Rollins of Citi. Please go ahead.
Thanks, and the after again.
2 questions if I could the first curious how you see the opportunities to leverage your 5 G network for fixed wireless broadband services over time.
And how your views of the potential funding for broadband in the proposed infrastructure Bill as an opportunity in which the dish may want to participate and then just separately of question on sling. It returned to positive growth in the quarter. What are your learnings on the customer interest to migrate from legacy video platforms to la.
Live streaming platforms and just curious for your latest views on the opportunities to move a larger portion of your historic dish video base to your streaming Sling service.
Okay, I'll, let Eric take the the slang question I think I think you.
You know the fixed wireless I think as a as a place where the wireless industry. It can go.
And Verizon and T mobile have already gone there, maybe AT&T, some as well, but certainly T mobile and.
Verizon of gone there are and so I think that the U S.
As as they line up more of their spectrum.
There's certainly.
The places that we can go there and obviously.
The.
I do think you bring up a good point I think that all all of us in the in the connectivity business or how you're going to have to look and see.
Oh, what the subsidy.
Oh of the government infrastructure, where the government wants to go and whether your particular company or whether you know strategically fit into that and whether that's a good business for you. So obviously, we continue to look at that but I think that's I think the the infrastructure of the amount of infrastructure of the government is talking about is probably a positive for <unk>.
All connectivity companies and certainly potentially for Americans that day.
Don't have service today.
That'll give to you, but it's only kind of Michael maybe just a few a few points on the on your questions. There I mean, what is you know the traditional dish TV satellite business as you know for for some time, we've really been pointing our of our efforts towards both acquiring and retaining those profitable customers that are in a a more rural.
Geography.
The strategy has been a bit of working well for us and so as the opportunity presents itself as broadband continues the densify, obviously sleek can be a and an opportunity for those customers that want to cut the cord there and maybe you have a couple of asphalt services along with the.
Service like sling, which can be very complementary to obviously of Netflix or peacock et cetera.
You know on the Sling side, you know there's a couple of things we've been talking about over the past few quarters of what is a there is a touch of seasonality obviously to you know the the OTT business as it is the low barrier of entry of its easy to cancel.
But with that said, we also put the oldest son herself to create a better customer experiences in Q2, you've seen us deploy now kind of day of some new technology in our new App to our you know most of the the Amazon base.
And of about half of the Roku based now so you're seeing us provide a better customer experience. We're seeing you know obviously better.
Yeah of the key metrics that you would follow associated with kind of a customer engagement, we're seeing those all improve and so we're optimistic.
The football.
Now about our ability to deliver a better customer experience and then obviously you know you got a couple of tuna events like the either Euro 2020 of your NVA, which obviously helps us it helps some of the sling numbers.
In Q2 so.
Alright on greater.
Now, we'll take questions from the press I'm not sure how many are in queue.
Thank you well now take questions from the media.
Again as a member of the media and you would like to ask the question. Please press star.
So wanted to know to answer the key to ask a question and our first question from the media will be from Scott Tomorrow.
Please go ahead.
Great.
Thanks.
Charlie on the.
The <unk> launch in Vegas.
I'm, just trying to get understanding of how that.
He's going to work you're calling it the 90 day, maybe the I believe.
What's the.
Who's coming onto it is it is it gonna be boost customers are these new customers.
And if it's the new customer or is this a new consumer plan.
Yeah. So the the beta test will be we haven't we have something called project Genesis, where people are signing up today.
To be.
On line to be beta customers. So it will come from it maybe some of our employees, but it will be random in terms of its basically set for people to give us feedback.
We.
I expect that the network is not going to be perfectly. So we're looking for people that they give us feedback and had improving will find areas, where we have to tune. The network for example, part of the so.
We need to know the location and service and so we'll just have people that.
The our regular customers are using it that are.
We are willing to give us feedback and so.
That's kind of that's how it'll start and we've been through that was when we rolled out high definition television or D V ours or any kind of new service that that's the approach.
Debt, we've taken and it works quite well and it allows us to move pretty quickly to improve our network because it's not going to be perfect. The first day.
So it's.
The 90 day beta launching in.
September I believe you said and after the 90 days it becomes a full fledged product, which is probably early next year.
Well I mean, I think of the way I'd say it is if if if if if our normal expectation would be the yes, we can turn into a full fledged product early next year right and it's true commercialized, but the.
We'll have to see how our beta goes right. So.
I'm in a beta test now for servers that are of different sort than I think all of that 9 months into beta. So you know it depends on you know we don't think that that's where we are but but we have to get more and more data on the beta to know when when we rolled out we want of rote we get from you know we get the first impression.
We want it to be a good first impression obviously, we have we do you know.
As soon as we.
Everything we learned in Vegas rose directly into the other network. So we can line up at the same time so.
The bottom line is.
That it's going to be a minimum of 90 days and if we do our jobs correctly and our vendors do our jobs correctly, then we're gonna be ready for primetime at the first of the year.
Great. Thanks.
Okay.
Well now take the next question from Mike Farrell Multichannel News. Please go ahead.
Hi, guys just a couple of quick things about Sinclair.
Just wondering if theres any way you can kind of.
A comment on what you might think is the kind of sticking point and this whole thing I mean is it bill.
Just the you know theyre asking for too much.
The money is.
Yeah regarding CS and there had been a lot of talk before me because you haven't had the Ars and for.
The 3 or 4 years that you were out of competitive advantage here in that maybe you guys would of been looking here at 2 of those channels and maybe they are pushing back on that and I.
I mean, you probably won't be able to talk too much directly about that for this contract what he's hearing something that youre looking at when you do artisan negotiations going forward.
Yeah, I mean, it's at the end of day.
It's about money, it's about the economics, but that hasn't changed that hasn't changed in any programming negotiation.
That I've ever been involved in right.
Alright.
You know 1 thing that we do differently is we we have fewer metrics and we know.
We know what the cost.
To the viewer is and how and we have a.
We have knowledge of how the customer values of channel.
And if you get real time viewing.
Data as we have from the last 7 or 8 years.
Can be pretty pretty precise on what the channel is worth then and.
That's that's the metric we use.
If you're on the other side of it most of most programmers just have a budget.
And there of a number of the game of Wall Street or whatever it is and they just say here's the number 1.
And sometimes those are pretty far apart.
But obviously the specific commercial terms of any negotiation of aren't something we're going to talk about publicly.
Operator, we have time for 1 more from the media.
Yeah.
Thank you, we'll take our final question from John.
And for towers. Please go ahead.
Thanks for taking my call. This is the first time I've been on on your call.
Charles if you're familiar with the daily newsletter the covers the wireless infrastructure business.
And the up to now we really haven't covered dish, but once you decided to build your own network and the and we took an interest but.
Let me ask the broad question that doesn't necessarily apply to dish, but I think he has implications across the industry for all of the planning and studying you've done in building the network.
Do you think its feasible that of carrier.
It does not have to 1 of its own infrastructure aside from say spectrum in software.
I mean, I mean, Tracfone proved you didn't have to own anything.
The very successful business they bought for.
Tens of dollars of billions of dollars market. They were very successful no infrastructure. So.
And what you know when you start looking at that I think the world will change I think the the kind of architecture. We're using the fact that technologies and in terms of cloud and O ran and virtualization mhm are going to change things and Hum.
We're where we have we're open minded about it I don't think I don't think I think we're open minded about the fact that things could change maybe in the way that we can't predict today or maybe in the way it is not even beneficial to us, but or our bet in our gut and of everything we know that it is changing it's very we're helping change it and when you help.
Change it when you when you are part of the future then.
And usually when.
It's the people who fight the future of that debt.
You usually have a problem in and we're embracing the future and we think that gives us the competitive advantage.
Great.
Thanks very much.
Alright, Thank you operator, and thanks, everyone talk to you again next quarter.
[noise].
That concludes today's call. Thank you for your participation you may now disconnect.