Business Strategy and Outlook| Michael Hodel, CFA |
Dish Network’s massive bet on wireless spectrum overshadows its declining cash-cow satellite television business. The firm has spent about $30 billion (about $55 per share) to acquire a variety of spectrum licenses over the past decade, with most of that spending occurring at competitive FCC auctions where the firm had to beat out wireless carriers far better positioned to put spectrum to use. Dish is now building a wireless network it believes will be technologically superior to the existing carriers. While the firm’s spectrum holdings and network assets will have value, we expect the firm will struggle to carve out a niche with this strategy.