Q4 2022 DISH Network Corp Earnings Call
Good day and welcome to the Dish Network Corporation, Q4, and year end 2022 earnings conference call.
Today's conference is being recorded at this time I would like to turn the conference over to Mr. Tim Messner. Please go ahead Sir.
Alright, Thanks, Shelley and good morning, everyone. Thanks for joining US we are joined on the call today by Charlie Urban our chairman Erik Carlson, our CEO , Paul Orban, our CFO and then a wireless side, you've got Tom Cullen EVP of corporate development, John <unk>, President and CEO of wireless and de Maio, our EVP of network development before we start.
I need to remind you of our safe harbors during the call we might make forward looking statements, which are subject to risks uncertainties and other factors that could cause our actual results to differ materially from historical results or from our forecast we assume no responsibility for updating forward looking statements for more information on factors that may affect future results. Please refer to our SEC filings.
We're going to generally go straight to your questions, but before we do that and then turn it over to Eric for a brief update thanks, Tim before we open it up for questions. Just a quick update this morning, we experienced an internal outage.
Continuing and in fact, our internal servers, and telephony or dish and sling services in our wireless and data networks continue to operate normally are up and running however, some of our internal communications customer care functions Internet sites were affected and are currently down we're analyzing the root causes and any consequences of the outage.
While we work to restore the affected systems as quickly as possible.
With that I'll open it up for questions.
Yeah.
And if anyone would like to ask a question. Please signal by pressing star one on your telephone keypad, if you're using a speaker phone. Please make sure. Your mute function is hard dollar to allow your signal to reach our equipment a boy's popped on the phone line will indicate when your line is open. So please state your name and company name before posing your question and again it is.
I want to ask a question.
Yeah.
Hey.
Hey, Rick Prentiss your line is open.
Yeah, Thanks, Hey, it's Ric Prentiss Raymond James.
Okay.
Turtle outages.
Two questions if I could first as well.
Very detailed question it looks to us like wireless retailer revenue has seen low for the implied fourth quarter given the year to date was there anything unusual there or anything to catch up and the second question is more strategic.
Steven leaving the operations and joining the board T mobile Amazon AWS had an announcement this week talking about private networks and working together with <unk>, how should we think about that.
Enterprise wholesale side what's needed.
Get that business going and when could it become meaningful.
Yes. This is Doug.
Paul I'll take the first question as it relates to retail wireless.
Cogs revenue hardware revenue it was down slightly thats due to units shipped you may notice, though that equipment causes up higher in the fourth quarter, we shipped a lot.
100% of five G units that has our chipset in it that's going to be a good investment for us because in the future we will be able to upgrade customers to our network and obviously get the economics at that point in time.
And this is Charlie on the second part.
Question.
The.
First the T mobile AWS announcement is what we would expect that I think that we are leaders in where that wireless networks undergo unexpected debt.
Everybody is going to have cloud based.
Networks and also.
Have a private cloud or public cloud.
<unk> made everybody a little bit differently, but that's going to be the necessity to get into the <unk>.
Enterprise business businesses, and Theres going to be a lot of business for everybody and enterprise businesses were.
Better positioned there we would expect this.
As a gross generalization with four players with national networks.
95% of the enterprise business wouldn't be unreasonable for us to get as opposed to the retail business, where we're starting decades behind people and maybe getting to the low single low double digits would be a reasonable expectation for us. We're just not going to be a dominant player in the retail wireless business, but our network is designed for enterprise is designed for.
Al.
And so we think we will get.
And we're leaders there from it from an architecture point of view today. So.
And then to further part of your question.
It's a slow sales cycle.
Obviously, because you obviously you have to go through and.
An architect everybody's got a little bit different flavor of what they want and so forth. So we're looking at verticals, where we already have relationships, whether that'd be in rural America.
Smart I think agriculture.
Whether it be in the.
Leisure and entertainment business, we're already doing video for for some of the customers. So that's and then there's all kinds of verticals that.
Our partners, whether it be a cisco or an Amazon or.
Dell that already have sales forces.
And those products. So I think you can see a lot of business for everybody.
Companies start putting new private networks. It will it will force their competitors should do it because they just won't be competitive.
Without their own private networks so.
That's the big picture answer.
And so.
And I think we have six.
We would expect that Youll start seeing real revenue from that next year.
But youll start seeing youll see some movement. This year, obviously, you'll see some announcements from people in the industry it would be great.
Im a fan if T mobile goes that get customers I'm a fan of that.
Whatever they can do we can do better.
And do you think bond or a voice over new radio is that simple.
Enterprise wholesale people wanted to see working or is it more of a nationwide coverage, but workforce.
What are the hurdles to that long sales cycle that they really wanted to see that box checked anything in particular.
I think.
Correct.
Broke up a little bit I think you asked whether what's the hurdle to the sales cycle.
It really is showing where we are.
The company can give productivity increases obviously, if there's investment so they've got to make they can make a return on that investment where do they get predict productivity, how do they make their products cheaper faster safer.
How do they have increased their security as a result of it.
And you've got to go through a lot of these are big companies that are looking at as you go into a lot of layers from the from the CIO to the CFO to the executive branches.
To go through and make that make that investment.
Great. Thanks Charles.
Yes.
Phil Your line is open.
Hey, Charlie Cusick Jpmorgan, Thanks for your time.
Two if I can one can.
Can you talk about the.
This comment in your disclosure today that said you've started sites that will cover over 60% of the population.
Are you able to start and complete the incremental 10% by June or are we getting ready for you to Miss this years, 70% deadline in extent.
25.
What funds would be.
If it comes to that.
Hi.
I'll, let I'll, let Dave Mayo answer that yes, hi, Phil it's Dave.
So we're optimistic about 70%.
We talked about.
<unk> thousand sites started in at the end of the year, yielding greater than 60%.
Ops.
We've now started over 17000 sites.
We're on pace.
With that.
Right.
Number that we've been talking about for a couple of quarters.
Typically takes three maybe maybe four months from the time you start the site you finished the construction get power in telco telco is probably the.
Probably the two risks that we have we are optimistic that we will see the 70%.
So just want to make sure.
Bottomline bottom line, let me be clear.
Not to beat the 70%, we don't expect to be paying clients.
And okay I just wanted to.
To give you the opportunity to.
Let everybody know that does automatically go ahead.
Okay.
I don't see why the disclosures as.
Disclosure is confusing but but.
Bottom line is we are on track for 70%, we're not spiking the football, but we're on track and we don't expect funds.
Thank you and can I ask as well what does it take to do a wider launch a boost incident at this point.
I answered briefly maybe turn that over to John but.
Well, we have two paths one is the FCC requirements for data right so to build that network.
We're that's where recovery is going to cover 70% of the pops in debt.
From that we've run into is as we are for commercial launch of <unk>, we need voice and we're doing <unk> voice our banner.
We made the strategic call not to <unk> voice and have all that legacy carry that round for the rest of our lives right. So we're thinking long term about that and saying look let's have the best voice in the industry, Let's go with <unk> voice.
That was their many companies are working on that obviously to T. Mobile has launched a couple of markets. The Chinese are working on that but but we're now.
The largest as far as we know the largest.
Company that has real time enter the United voice of <unk> in the United States.
And I.
And John will give you a little more detail on that that we've got it. So now we've got it up and work and that was that was probably one of our biggest technical challenges and we're very thankful to the <unk> of the world and our vendors that kind of helped us.
Get there we wouldn't have got there with Adam and so now we're starting to roll that out as fast as we can but we kind of get over those hurdles, but thats, what we need for commercial launch. So what happens is you're going to see you're going to see.
A six month lag I'm going to say six months it could be a little less than that but a six month lag from the time, we get data to the time that we optimize that network.
Fully to be able to do voice <unk> voice, because it's very tricky and you get to a very dense network to do it John .
Yeah, Thanks, Hi, everybody it's John .
Charlie hit number of the key points, there's really three major things, we need to accomplish we need to get to 70% as Dave talked about.
Exit our TSA with T mobile.
Which we expect to complete by the end of the second quarter.
And then we need to get our postpaid business up and running and expanding.
We did launch boost incident early access programs.
It's right in closely alongside progress with the network.
We do have.
12, Big markets, and 30 million Pops, where we're loading up with small customers onto our <unk> network today.
With <unk>, we're happy with how the performance of the network is going.
And we're starting to get devices onto that network. So we're we're now loading a motorola and most recently Samsung devices onto <unk> networks boost and.
That's sort of cleans away for starting to work with Apple and get Apple certified apples, obviously very important from a postpaid market share perspective, so we're working hard on that.
And within that you'll see us get moving as <unk> to build momentum, but then we can really hit the gas when we get devices onto our network in our markets. We do expect to increase our <unk>.
Full commercial bond our coverage, which is 30 million Pops today includes markets like Dallas, Houston, Las Vegas, Cleveland to name a few we do expect to be able to increase that by about 50% per quarter.
We certainly hope to beat that we're getting tremendous support.
From our teams and many of our key partners and.
In making that happen, but we like postpaid, we'd like get better with our own owners' economics, and we're full steam to go make that happen and youll start to see a boost and put in the market here in the first half of the year.
With with more great marketing and advertising support.
By the way.
Since you guys are offering many of your finance guys.
Postpaid customers materially more profitable they're frequent customer.
I've said this many times that the marketplaces to me as a former financial lines, there has been upside down with prepaid <unk>.
The most competitive in the world everywhere else in the World Prepay is actually.
Less competitive than postpaid are more expensive than postpaid and postpaid probably not as competitive as it should be.
So it's a little bit upside down. So so we're excited to be able to enter the.
They're really lucrative part of the wireless business the consumer side, that's not to say I believe personally the enterprise business will be will be equally or more lucrative for us, but the postpaid side has been a longtime coming for us even though we started.
King.
Small scale, but that now we're able to do it.
$30 million you start to it starts to be something you can market and.
At the end of this year, we'll have scale.
70% of the United States.
That's that's about the size of our sprint was.
That that start to be interesting for us.
Thank you again.
Your next question comes from Doug Mitchelson.
Your next question comes from Doug Mitchelson with credit Suisse.
Okay.
Operator, we will move on.
Okay.
I am sorry, I am here can you hear me.
Yeah, Hey, Doug.
Sorry about that interesting system. So.
I guess first question Charlie I, just think about your broader strategy and financing needs. The next few years as the 11, 75% pricing for dishes latest bond issue have you rethinking anything I kind of I guess I would think about.
They need a rollover existing bonds, we do invest in wireless and then potentially buying out that T. Mobile spectrum is kind of three buckets of financing needs and any clarity as to how you're thinking about those three things in there anything I'm missing here.
Latest thoughts would be helpful and I've got a follow up.
Yes sure Doug.
Big picture is obviously, we we.
Look at the marketplace.
Where are we.
Probably.
And then in hindsight went a little too early for the bond deal before the first of the year, but.
We wanted certain data to make sure that we better our build out and took that took that overhang off the table and get into and so.
Paul can answer this maybe a little bit better, but we obviously DBS to having bought a bond payment due on March 15th we intend to pay that with our DBS.
From DBS with cash on hand there.
They continue to generate.
Good cash flow in.
No.
We'll look at their maturities in the future with their cash flow and then obviously we are.
Looking at retail wireless in the network go to finance.
So some of that business and.
I think the first hurdle when we look at there is a convert next year.
In March I think it is the next year and we will look to refinance that with hopefully an equity component.
<unk>.
The I think you talked about the 800 megahertz.
We've said publicly that it's a nice to have it's not a must have but there are positive developments there.
It's.
It's obviously, we like we built that frequency app. So there's not a buildup costs the incremental build out cost for that so there is there is some opportunity there.
But we're not we're not suicidal we're not going to sacrifice our balance sheet for for some short term gain so.
We will have capital needs in the future, but we're going to start.
Our network is going to start generating a lot of cash and we just got to make those to marry up in a timely manner.
And relate that to the street in a way that you guys can understand it.
So deja Vu for me back in the in the DBS business.
Exactly the same position.
Once we launched or satellite we had a period of time, where we had to make it work.
And work out the Kinks, but once we're able to do that.
It started generates a lot of long term cash in.
The interesting that the best metric for US early on there was pre marketing cash flow, but it all turned.
I used to always say it was like a slot machine you put a dollar in and get $2 back every time you get a customer. So you Couldnt go fast enough.
And you put a dollar in but you've got the $2 back over a period of years. So we're in a very similar situation as our network goes up to scale.
I think it is right now before you.
And that's before you add the enterprise business in which we have to prove to the street, obviously, but internally we know that that's a place we know thats a place people are going to go.
And that leads right into my follow up which is on the retail side since you've already addressed enterprise.
When should we expect kind of a material ramp in.
Subscribers when does that kick in does that does that later this year post the broad launch is that really a 2024 event when does that start.
Yes.
Youll start seeing some some numbers, but you won't see youre going to see material ramp when you have scale, which I define as 70%.
With voice coverage, so again, given our build out.
Six months from build out to optimize so that gets you to 70% by the end of this year.
Optimized and then then you can do things like National market, and then things because you have scale to do it. It doesn't mean that we're not going to put people that we're not going to add subscribers prior to that on our network, we will but.
In terms of the hockey stick it starts it starts where you have scale.
We are a good steward of capital and.
Great.
Just gave an example, but the prepaid business if we invest a dollar in the prepaid business we.
Get a small return on it and if we if we invest a dollar in the postpaid business, we get big return so.
We're obviously.
Saving capital for the for the postpaid business, that's a pivot that the market probably doesn't fully understand yet it's not your fault, we haven't gone out and explained it to you, but that's a pivot that youre going to see this year and you're going to see that that makes a world of difference.
And the long term financial stuff and Thats before you add enterprise if you can give us no credit for enterprise.
Gave us zero credit for enterprise, you'll see you'll ultimately be able to see it in the postpaid business that you can.
You can generate a return on capital from just the consumer assuming that we can get our.
Fair share of postpaid customers.
Thank you for the time and continue to.
On the prepaid path obviously just.
Not as a priority over postpaid.
Got it thank you Charlie.
Okay.
Your next question comes from James Ratcliffe.
Hi.
If I could on come.
Coming back to the T mobile 800 megahertz.
It's a nice to have I noticed you wrote up the value of the option.
<unk> and attributed to both with increasing.
Option values and also an increased probability.
Can you talk about what drove the increase in assessment of probability to exercise the option.
I can only say that there have been that there is positive.
This positive things around that frequency and that's about all I can say so.
That's why the profitability went up.
And so forth.
So it's essentially that became more appealing spectrum down.
I'd say, there's positive developments in terms of return.
Return on that spectrum.
Got it and then this is Paul I'll just jump in there.
What happened is the probability that we would exercise has increased which obviously leads to charlie's comment that there's positive. Thanks.
Going onto herself.
Great. Thank you.
Your next question comes from John Hodulik.
Great. Thanks.
Couple of follow up questions. If I could so first of all Charlie does the pivot to the postpaid market come with substantially higher EBITDA losses.
Go after that market I mean, I've seen the EBITDA, the wireless EBITDA losses sort of ramp a bit does it does it ramp further from here.
Go after that market and then in terms of the timing is the timing of the postpaid launch.
Sort of more tied to the iPhone certification or or is it the 70% coverage or both.
I didn't hear did you I didn't get as part of that but.
Maybe you have to ask the question in a little bit broader terms and you can ask a follow up.
The focus that we have is.
Because we have today is management is let's get it to 70%.
For the FCC milestone right that takes that takes any chance of taking our spectrum backed off the table. It takes.
A lot of times people focus on.
Out of the conversation.
And it's.
Unbelievable effort.
Code and supply chain shortages to even do that from a standing start so it's a real I'd be real fast I can't we'd be really proud to do that so that's a focus.
Yes.
Second focus is has been to get up as John mentioned this is something that that's important that the street, probably then focus on but.
We're on two operating systems Oss BSS services in the TSA that we have from T mobile and then our own internal.
We've got to get everything to our own internal.
System, and we've got to migrate all of those customers over.
Not as difficult a CDMA migration, but nonetheless.
Big focus for us to do and it takes a lot of time and effort to do it so.
That we got to get done so those are the two big things to get done before the end of the next quarter and then to your point.
<unk> and postpaid world, obviously apples.
A trusted partner and are important for us, but we haven't been able to do the kind of things that maybe they'd like us to do our we'd like doing the prepaid business. You just it's hard to to sell 1000 are found to customer has no credit but on the postpaid world. That's obviously a different issue. So so we're excited to get to get to get started with them in it yes I think.
I think it is a.
I think it is a.
When the <unk> comes out and you can put it on your network and a postpaid environment and you got you.
Pretty close to scale at that point, I think thats a game changer for us.
And that that we get certified and have a business arrangement with Apple that's productive for both of US. So we have to focus on that because that's not done yet.
But it gives you a feel for some of the big things that we work on.
No.
Last quarter.
We were able to get.
A couple of things, we now have Samsung and May have an error in our network. So we have two vendors that prove out ran works, we have two vendors or radios, a third vendor in test.
That should be completed pretty soon.
The world that we've got phones now both on Motorola.
I'm sorry.
Working on arent that have are all our bands for the network. So we.
We're making a lot of progress.
Every day, it's not showing up in the numbers, yet probably not going to show up in our numbers next quarter, but then youre going to start seeing it youll start you'll start seeing the beginnings of that and then as we get to scale Youll see Youll steel.
At that point somebody who will be glad to an investor.
Got it.
Yes.
Jonathan I follow up with <unk>.
Question.
Our postpaid more costly from a sac perspective in prepaid as Charlie alluded to earlier.
Paid we will end up subsidizing less so it should be a cheaper acquisition costs. When we add those subscribers exact sac per se will probably higher.
Yes, but the subsidy will be lower.
The fact that that churn is much lower so you just got to been again.
The real World is today, where we're seeing at least in the industry, 1% churn in postpaid and we're seeing 4% plus in postpaid and prepaid. So that gives you a feel for.
For it.
Look.
I would say I would say a postpaid customers worth five times, what a prepaid customers I could be off by one one turn there could be six could be four but.
<unk>.
Yeah.
Okay.
Anyway, you can see where that goes.
Sure and I guess, just a follow up just to finish that off but as you go after the postpaid opportunity should we expect sort of an uptake in.
In EBITDA losses.
We capture that opportunity from where we are you are exiting the fourth quarter.
I hope so.
Okay.
Yes.
We look at EBITDA, but we obviously look at that we look at long term cash flow. So EBITDA is not our driving force. It's all about cash. So we would it would be a nice problem to have assuming we weren't doing that efficiently efficient efficiently.
Got it thanks guys.
Your next question comes from David Barden.
Hey, guys, Thanks to Steve Martin from from Bofa.
I guess, a couple ones just a housekeeping item and maybe this is getting to the heart of the question of <unk>.
Good things happening around 800 megahertz, but.
The re rating of the value of that option is people are wondering if the opportunity exists to maybe sell that option to someone else or executed on someone's behalf.
And we might look at that as a funding vehicle.
For dish rather than.
Kind of the entry point to spend $3 $6 billion on on spectrum you already have.
The second question, if I could I'll stop you there okay.
I would just comment on that and then you can ask your question.
We're not so we're not going to do anything that doesn't make economic sense.
Alright, but.
It's clear that we value the option.
Right, but we're not going to do anything that doesn't make any did make economic sense. So that you could.
There is no downside in that option there is no downside and doing nothing right.
Alright, there's only upside.
Fair enough. If you if you have your strategy wise, you would only do something if it was.
Accretive.
That's the only way you do anything then than it is a positive.
Obviously, if you're suicidal you do something at all costs that might be a different story.
Fair enough if I could.
Maybe just.
Two follow ups.
So just.
Maybe Charlie I think you kind of made an off hand remark about this earlier, but could you tell us a little bit about the process that maybe you think did or didn't happen that led to the Amazon T mobile relationship.
And then.
Whether you think that maybe there are other relationships like that that could emerge in the private <unk> network development space with with the hyper scaler.
And then my last.
Question would just be related.
Two the kind of.
Charlie you keep talking about getting to scale and that being the gate keeper of the threshold through which once you get there you'll you'll create.
Scalable return opportunities.
Yes.
About a year ago in March Verizon, who has more skin in the game than anyone who has put a $100 billion of money into this laid out a multiyear game plan for revenue growth.
In May you did kind of the same thing.
Over the course of the last year, Verizon again skilled player presumably has the keys to most of the doors out there in the market decided that that opportunity wasn't nearly as large as they thought and had to really scale back people's expectations.
And you guys have not kind of revisited that that thought process I'm interested to kind of understand why you.
Think nothing's changed from kind of the view you had in may when it seems like all the other players have.
Change their view thanks.
Yes again.
It boils down to we have a modern <unk> smart network based in the cloud on open ran principles.
That's again I'll say, it again, thats Netflix versus blockbuster seafarer blockbuster youre not going to say Oh, we think OTT streaming we thought it was a big thing, but we're scaling it back because you just can't do it you can't do it with stores right, but if you're Netflix you say well we have the modern network. We have the modern technology. It took Netflix some time wall Street.
Very skeptical them early on and took some time to prove the concept, but it was better faster cheaper and it's pretty hard to fail on business, if youre better faster cheaper and our network is going to be better faster cheaper and it's architected different so it's.
I don't want to spend a lot of time on it because it's not.
That's something that that's going to be readily understandable on this on this call, but you're starting to see that.
<unk> of open ran and the kinds of things. We're doing you just saw white paper from all the big players in Europe yesterday.
They almost verbatim.
Articulated dishes.
And Mark Lyons architecture, they almost verbatim articulate everything we said and they have legacy so theyre starting to more rural areas to start right. So.
Legacy <unk> legacy as a negative for us it's nice that you have scale, they all do but legacy as an anchor around their neck.
And so we have an opportunity there to the extent that we execute.
Obviously, you have to execute and Thats, what we have to prove.
And then obviously that the T mobile.
T mobile Amazon again, we're not exclusive to Amazon, they're not exclusive to us Amazon got into and helped us they've been a great partner. They have helped us a lot and theyre, putting an investment in so that they can go sell sell this architecture to people around the world and we would expect that that.
Many more telcos will sign up with Amazon or perhaps the other cloud providers because.
Everybody now.
I think almost everybody believes the core should run in the cloud and I think that they're going to get kind of everybody is going to look at edge compute and some of those things and that leads to that leads.
A precursor to <unk>.
Pivot networks.
So.
Yes, maybe the street looks at that as a negative.
At least as far I don't know the exact deal, but I think the more of the marriage or when it comes to private networks, because I think that's something that the competition between companies.
To make sure it scales.
Fair enough. Thank you.
Okay.
Your next question comes from Collyn.
Hi.
<unk> from Barclays Charley from a funding perspective.
Obviously, you mentioned the 800 megahertz is an option you can choose or choose to exercise and then from a scaling perspective it sounds like.
The retail business.
In terms of scaling happened more towards the end of the yet or.
Next year.
Does that mean for this year, you don't need to raise any more capital and modernize them with.
With this or.
Should we expect more by Monday.
Monday.
And secondly, I mean.
In some ways funding as a discretionary choice for you it depends on how fast you really want to go.
In order to build retail.
And so would love to get your thoughts on.
The scaling there isn't a function of the funding you can lease that is it.
Independent of that and.
Linked to essentially kill 270% of the country once the network is up and running.
The short answer is we don't need to raise capital this year.
Our business objectives.
Right.
The second part is a little more complicated because everything's intertwined everything's interrelated so.
Thank you.
I'd say it this way.
Investors are smart and they will invest in good business plans and good management and to the extent they understand it.
So to extent that we have good plans and good execution and to the extent that we need to go faster because it makes sense, then I think that.
And to the extent you would need to raise capital to do that I think it would be available.
Thanks, Dan do you have a bad plan and bad management, you're probably not.
So.
Yeah.
I don't know.
We're not arrogant.
But I think we're confident.
But we know we have a lot to learn we know we're making lots of mistakes.
But.
Where do the hard part.
The hardest part.
Okay.
Got it.
And anything on the Keeling component I mean to what extent Q2.
Might choose to maybe.
Extended service all throughout the country to the this year versus maybe doing it more gradually.
For the next couple of years.
It's a good question.
We will extend the postpaid throughout the whole country.
This year.
Obviously.
So there is some country that will be that will be on that will ride on it on T Mobile's, our At&t's network.
So.
That's not as economical for us.
But we will but it will give us nationwide scale, which is important so.
Our customer we put on T mobile or AT&T is more profitable than a prepaid customer.
By far but.
But it's not as profitable as putting them on our own network. So you can imagine.
We'll play that.
So it will move.
Answering question.
We will be nationwide on postpaid.
Okay.
Thank you Tony.
Okay.
Your next question comes from Jonathan Chaplin.
Okay.
Hi, Charlie a couple of questions. If I may I'm wondering if you can give us an update on the DBS deal.
And the prospect of a wireless spin on DBS.
I'm surprised.
Given comments earlier that we actually have seen an announcement yet so wondering what might be what might be holding that that deal is up at <unk>.
So obviously in everybody's interest.
And then.
You mentioned that you don't need to raise capital this year to meet business objectives.
Do you need to raise capital before March 2025 to meet business objectives, leaving aside.
Refinancing the convert and things like that.
But the second part I would say based on what we see today would have to raise capital before March 2025.
The I think there was a question about DBS deal, obviously, I've said I've always felt that it was inevitable.
Change my opinion on that but we have nothing to report today.
On wireless spend.
I mean, obviously are our board looks at a lot of different.
Opportunities there is certainly the wireless business on the retail side is as you can make the case is separate and apart from the wholesale side of our business. It does track a lot with Eric and his team do daily with DBS in slang.
Potential customers and those kinds of things so they're potentially our strategic things that may make sense there.
But nothing to announce today.
Okay. Thanks, Tony.
Your next question comes from Bryan Kraft.
Hi, It's Bryan Kraft from Deutsche Bank Good morning.
As Dave Barden alluded to in his question earlier, there has been a lot of discussion lately about the slower than expected pace of private <unk> adoption. Among enterprises. Many investors are asking the question as to whether there is some connection between that and Steven by leaving his management role of dish as head of enterprise can you just talk about what's going.
On there from a demand perspective.
If you can share anything on maybe why Stephen decided to leave and lastly, how you are managing the enterprise sales effort now who is leading that thank you.
I can't speak for Steven but he did get an opportunity to be CEO of the company and this will qualify for that but I think Steve we would take a call.
Right and obviously remains on our board I don't think.
I don't personally think there was anything in his leaving that would reflect badly with respect reflect any kind of concern.
Private enterprise business isn't a big business I don't think if anything I think that.
If anything I think he.
And we are probably more optimistic than we were a year ago on that so but feel free to call him because I just can't.
No.
Can't speak for him.
And can you just talk thank you for that can you talk about.
Who's leading the business now and how youre managing the sales effort leadership there now that he is no longer in that role.
Okay, well thank you John .
Yes, hi, its John <unk>.
We've been building our team for the last four years Theres a lot of talent inside dish wireless now.
So I don't think its about any one person.
I am personally calling on a number of enterprise customers as our supplement members of our senior management team.
I think the momentum is picking up.
Echo Charlie's comments.
We're really busy having really good discussions with a lot of big companies and Thats, what we expect to be doing and I think we said earlier we'd be.
Seeing some of that business start to pick up next year.
But we're not confused with job one is getting our.
<unk> network up and operating.
At scale.
And.
There's a lot of focus there and I can take the eye off the ball.
<unk>.
Looking at other things that it's really about sequencing, we need to get the network up and running first and then theres lots of opportunities in the pipeline, we can take advantage of.
Operator, we'll take one more question from the analyst day.
Operator, one more from the analyst community before we move to media.
Okay perfect.
And after we make that final call. We will begin the media portion of this call.
And again that would be star one to ask a question from the media.
And our final call from the analysts is coming from Michael Rollins.
Thanks.
A question and a quick follow up.
So.
In terms of the wholesale side of the business. What are you seeing in terms of the potential this time frame.
Large anchor wholesale deals for the <unk> capacity you're building.
And are there certain commercial milestones that you need to reach potentially different than what you outlined on the retail side.
Order to put dish in a prime position for acquiring these wholesale opportunity and then just a quick follow up on your network I was just curious.
As you are on this pace of building, a 1000 or starting a thousand sites per month.
At what point in the future does that pace change either accelerate or decelerate from the current.
Level. Thanks.
Yes. This is Charlie I think we've answered the first part of your question a number of times, but.
The.
So from an enterprise side.
Private network side of the business.
We're already we're already positioned because we've got the architecture that.
We believe is required to do that properly right and Thats before you get into things like AI and Jeff GDP only a positive for what we're doing we properly foresaw as part of what we needed to be able to do.
Scale will matter and reaching 70% of the country will start opening up a lot more opportunities.
Because now some conversations around it on a regional basis today, so that that is probably the one thing that.
Missing, but we're not having to change the.
Architecture, what we're doing so we're already.
Positioned and so forth and I think the thing is ultimately regardless of who signs private network deals is going to be a positive because it.
Your competition does it if over signs a deal then lyft has to sign a deal I was just going to add business. As an example, so so that's that part and then on the second part.
Charlie.
I think more about the wholesale side.
The equation, so like someone using you as their wholesale partner like an MVA no relationship whether it could be a cable.
Sure.
A big Internet company, so someone using you for national wholesale capacity.
To meet whatever any strategy.
Same answer because we'd have to have scale.
The network and we have two things have to happen we have to be up TSA from T mobile.
We again are focused on for the first half of the year.
End of June and then the second one you have to have scale, which again, we're focused on by the end of this year than I think we haven't really neat platform for people who might be interested from a wholesale perspective, but that's that's very similar to what the enterprise opportunity as well and then on the.
Okay, Thanks, and the second tower.
Yes, and I think I think they want I think that once we get once we hit 70% that that does that.
1000, a multiple will decline.
In other words, what at that point there is.
I think Dave's focus I shouldn't talk for him, but since I'm talking.
His focus will be to optimize the network within the markets that we are there'll be some small cell there'll be some fill and stuff as we get traffic on the network and finally, we have a dead spot and we will focus on.
That will still be new towers.
But it probably will be.
A lot less than the 1000 run rate.
Thank you.
Your next question comes from Mike Bufano.
Yes. Thanks for taking my question hopefully you can hear me okay.
Two separate questions. One is can you just kind of explain how the network launch is going to work throughout the rest of this year. I mean do you have the voice of owner service up and running now and how is that going to be expanded business and how does that how does the rest of that like commercial launch of the <unk>.
Each network work throughout the rest of this year and then my second question is if you could just talk about that the satellite opportunity. There's a lot of companies that are offering.
Satellite services and I Wonder what your thoughts about that are particularly given the ownership of echostar. Thank you.
This is John I'll take the first part and then pass it to Charlie for the second.
So made a few comments on this earlier in the call.
First of all all of our on our sites are providing fiber broadband.
And now as a subset of those we're going market by market.
To two in the market for our commercial water.
As I said earlier, we now have handsets.
That are available to boost mobile that run on our <unk> network with commercial water and we view that it's going pretty well.
So as we are.
Look at really the 20% Mark is from last year, we're going through each of those markets and doing the optimization and the fill in so that we can achieve commercial bonner kpis.
When that happens.
Mark It up with handsets at work on our network and we start marketing services.
Those devices and we are basically going to be launching new markets every sometimes every week, but as said earlier, we expect to increase that $30 million.
<unk> footprint by about 50% every quarter.
And we hope to beat that and you'd see us certainly.
Marketing services digitally in those areas.
Starting with boost mobile and that adding boost infinite.
And we're.
Doing.
Quite a bit of work to prepare our indirect distribution.
Market and provide those devices to our customers and Youll see us really picking up speed there as we do that.
Throughout the year and really by this time next year, we would expect to have commercial bond are available throughout the 70% footprint as we've said earlier and then this is Charlie on the on satellite.
Handset or device.
Obviously.
It might be a really good question to ask Echostar on their conference call.
But we're unique we're unique in that the obviously the the common ownership between the two companies.
Where when you look at the two companies together, we understand satellites.
Well, we understand video really well and now we understand the future of telco really well all within it.
Jim.
Sure.
Company so were.
We are well positioned for.
Hey.
We believe that there's going to be a big market for satellite handset Theres a number of there's a half a dozen companies that are.
That our plane or announced that they want to play in that in that category. The FCC is going to do a rulemaking with some with some rules around it.
That are interesting.
To see they'll pick winners and losers when they do that.
But we're well we're well positioned we are doing some satellite handset today, both in Europe , and the United States, we own spectrum.
A fair amount of spectrum in both North America and Europe .
And.
As a result of that we have a very clear.
Understanding of the technical challenges.
To make that happen in a way that.
You might know satellites, but if you don't know telco those two things you have to make those those things merit each other.
The big positive development there.
Is that the three GPP standard now has a has a MTN our non travel network standard there relates to satellite that.
That's never been there before so that and released 17 that is there now so chipset manufacturers.
Can make.
Something to our standards, so that that handsets and devices can can operate with satellite. So I think there'll be a number of players that will play there there'll be a number of players that will fail.
And there is certainly room for one really really good system.
Okay. Thank you.
Your next question comes from Amy Maclean.
Hi, there.
I feel like the odd man out asking a video question, but.
The Cox media Blackout said should we probably not expect any resolution before the FCC weighs in on standard General and technology.
Yes.
This is Eric obviously, you know the situation with with.
With Cox.
We are open for discussions with Cox, but as we've talked about on the call before.
No.
For Retrans is one of those things that from a rate perspective.
Really going up higher than any cost of programming and like we're.
As we talked about it.
On the wireless side. So you don't feel like such an outlier I mean, we are economic.
Economic focused and so we look at the.
The cost.
The content and the benefits.
To our customers all things being considered I mean, we'd rather have the cox stations up the knot.
At some point it doesn't make economic sense for us.
So we're we're unfortunately caught in that particular piece of negotiation and Cox has decided to put our customers in the middle of it.
So.
I can't tell you when.
Yeah.
We will reach a resolution with Cox, but we've had a decent.
Decent relationship.
And we certainly hope that we would but at this time I cant announce any resolution.
And this chart I would just add a couple of things one is obviously accurate <unk> acquisition and trying to really get.
Born monopoly power they already have as something for the FCC to look at but.
And obviously.
That may have played into this particular dispute.
Air side, but the fact is that local local broadcasters I feel for them because they are we have real statistics, we know what our customers watch both on OTT and linear TV satellite, we absolutely know what they watch we've seen the trends for 25 years.
The fact that the.
The local networks now or go on the path of regional sports, where the costs get so high that its mark.
Any rational company, we'll make more money by not having the service and customers are.
Continuing to show that they might they might have watched it.
The broadcasters themselves are cutting back on the content.
And so they're not producing the highest value drama shows and stuff are going somewhere else to OTT customers are following them there and so.
Former president of NBC.
I mean years ago. He said people go and watch the lease Subjectional programming.
And that is true and so our customers are going to find alternatives.
So the networks and even the mainstay of professional football, which is probably the one main stay. They have is is readily available to a number of sources.
Today so.
The next step in Retrans is down not up.
And.
And the broadcasters have a budget and they have debt to pay and they haven't got the memo yet so I think you're just going to see more people I. Just think you get and every time they lose the customer as they used to come back to them.
Those cocks channels, they are not coming back to their local news they are not coming back to those drama shows because now they are watching the vehicles. They are watching something on HBO or Netflix and they've got hooked on some other show and Theyre, just not coming back and the fact the matter is that any customer that wanted Cox and molasses left dish. So now its a tax if we put them back up so.
That's the way I said, it about regional sports I'm, saying it now.
That's where that's going and it's a shame it's a shame because this is a shame because the local broadcasters are caught in a bias between the.
The network and the distributor so.
We have some empathy for our there applied but we cannot be their bank.
Unless we get a return and right now.
If I can just throw in one more I know that swing just launched this free stream service I mean, do you see fast channels as a way.
For some leverage when it comes to Retrans or affiliate fees for channels.
Amy I don't I.
I don't see fast fast necessarily being leveraged for Retrans that obviously there is.
Certain things around that yet.
That you are likely aware of but I mean on slag, it's as easy as you know.
Customers the customers that we have on slang Love's leg, but as you know OTT is a bit seasonal.
It's not much different from regional sports related so folks can come in and out very easy and free stream is.
It's great for us to launch because it keeps folks kind of in our selling ecosystem right and so we're trying to make it easy for customers to watch TV and have it be a seamless experience folks still love television.
Unfortunately, it's just gotten hard to watch television.
And so free stream helps too.
Have customers without our sling ecosystem that.
You may want to pay for college football over the course of four months and then pick up some general entertainment on a fast channel.
Come back for basketball and so it's very easy for us and it was just it makes sense for our sling customers.
To have kind of a fast.
Offering along with our direct to consumer offerings, where you can buy an AMC plus discovery plus et cetera. So.
I don't see that necessarily where I see it impacting retrans and it's obviously, there's more there's more content to watch.
The content cost less.
So as Charlie said when Cox goes down.
And you don't really Miss your local news and you find it elsewhere.
You don't go back.
And so it makes it makes linear TV that much harder.
This is John we have no leverage against we have no leverage against Scott or any local broadcasters their absolute monopolies in their markets have no leverage, but the consumer has leverage and the consumers are saying to us we do not want you to raise our price and there is so much content out there. There are so many places we can go debt.
Absent.
The Super Bowl.
Right.
There's just not many and NFL football, which are now widely available other places.
There is no there is no network programming that that generates.
Much excitement anymore or that type of stickiness.
Or is that kind of sticky so it's rare so.
There's a new there's a new <unk>.
The newspaper of the.
Of this decade, which is you raise your price your newspapers and there's a few people continue to read the newspaper I am one of them.
But the fact of matter is that I don't read the newspaper I get my news elsewhere now and if I lost my newspaper Tomorrow are probably okay.
We're a little tight on time, we'll take the last media question.
Thank you.
And our last question is coming from John for that.
Hi, it's Jonathan Montana from inside towers, Thanks for taking my question.
No questions at this time.
I just wanted a clarification that you will be breaking out your subscriber numbers.
<unk> versus <unk>.
Prepaid or MBA numbers going forward and when how soon that might happen.
Yes.
I guess I'll look at.
Thank you all for that well, we have no intention to do that right now, it's probably a little premature as things progress, we'll take a look at that and consider it.
Right now we have no plans to do so.
Okay, well it would help.
We look forward, we look forward to that thank you.
Alright, Thank you everyone for joining appreciate it operator.
Youre welcome.
This concludes today's call. Thank you for your participation you may now disconnect.
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