One of the biggest concerns about the proposedT-Mobileand Sprint merger was the competition among wireless carriers. If the merger was approved, there would only be three brands instead of four, which would mean that the wireless providers would raise prices. To avoid this from happening, the two companies struck a deal with the Department of Justice (DOJ) that Dish Network would acquire one of Sprint's prepaid brands and become the"fourth nationwide facilities-based network competitor."
Since then, the agreement was set that Dish will be acquiring Boost Mobile as part of a $5 billion deal, including the 9.3 million customers, 7,500 retail stores, and 400 employees. The agreement also included 14MHz of Sprint's 800MHz spectrum and a 7-year MVNO agreement with T-Mobile.
In April, T-Mobile and Sprint announced that they were already working as one brand and that they were just finalizing the deal with Dish Network. A few months later and it looks like the deal has not yet been completed. There were even reports last week that T-Mobile was looking for another buyer in case Dish would back out. Meanwhile, they are anticipating the deal will close by July 1st, which is the expiration of the original Asset Purchase Agreement (APA) that Dish filed with the SEC.
Now, it looks like Dish needs to look for a willing partner with enough resources to help it establish a standalone 5G network. There are rumors that Apple will be stepping in, especially since the late founder, Steve Jobs, considered offering an iPhone with cellular service when it was unboxed. According to the rumors, the current CEO, Tim Cook, is interested in a plan that will allow data to be sent to iPhone devices via satellite. This can be possible with Dish when they agree to a 5G network ownership. Other rumored partners include Google and Amazon.
With Apple's deep pockets, it would definitely be a big help for Dish. It is estimated that Dish will need $10 billion to build the standalone 5G network. And with the clock ticking on the deal with the DOJ, Dish really needs to make this happen and cover 70% of the country with the promised 5G signal before June 14, 2023. In the event that Dish is unable to meet this goal, it will need to make a"voluntary contribution" to the U.S. Treasury in the amount of $2.3 billion.
For its part in the deal, T-Mobile made a promise to the FCC that it will cover 97% of the country in low-band 5G signals within 3 years after the closure of the merger. In rural areas, the promise is 85%. T-Mobile also committed to deliver mid-band 5G to 75% of the country during the same time span. After six years, it promised to offer 99% nationwide low-band and 88% for mid-band spectrum.
As the deadline is nearing, we're curious to know how it all plays out in the end. Hopefully, both parties get satisfied with the result of the deal.