Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

DISH Network Corp. (DISH) Discloses Its Intention To Partner With Sprint Nextel Corporation (S)

DISH Network Corp. (NASDAQ:DISH) reported its Q4 2012 results with a 33% decline in net income and also threw light on its wireless plan as the company looks to strike the Clearwire Corporation (NASDAQ:CLWR) deal. The company Chairman, Charles Ergen, stated that the next strategic move would depend on the regulators decision on the Sprint Nextel Corporation (NYSE:S) – Softbank deal. However, Ergen finally unravels the actual intention behind pursuing Clearwire in a counterbid, saying that satellite provider envisions to partner with Sprint which would assist it to offer mobile wireless service.

DISH Network Corp (NASDAQ:DISH)Clearwire has formed a special committee to assess the offers from both Sprint and Dish. The counterbid made by Dish raised doubts regarding the second largest satellite service provider’s intention on how it plans to use its spectrum.

The story unravels
DISH Network Corp. (NASDAQ:DISH) has plans to diversify from its existing pay-TV business which has been experiencing hard time with intensifying competition from other cable companies, internet and telecom providers. The satellite provider recorded a profit of $209.1 million in the last quarter, down 33% from last year’s comparable quarter as cost of acquiring new customers increased. The Colorado-based company’s revenue fell 1.1% to $3.59 billion. It saw a net TV-subscriber addition of 14,000, down 36% from last year and much below the analyst estimate of 48,000.

A part of its diversification strategy, the company has been looking to partner with an existing telecom operator which can help it in achieving its dream to enter the telecom arena and build a 4G network to provide mobile broadband service. So Dish made a counter proposal of $3.30 a share to Clearwire against Sprint Nextel Corporation (NYSE:S)’s offer of $2.97 a share. The company’s intension is to acquire Clearwire’s 2.5GHz-band spectrum to complement its own spectrum in 2GHz and 700MHz range and then ultimately partner with Sprint.

‘Sprint and Dish match up pretty well’
Ergen argues that if Dish’s bid is accepted, it would be best for all the three parties. The money losing regional carrier, which is in deep need of capital infusion, would get financial assistance. Sprint would also benefit from the additional fund to construct the required infrastructure and deploy the LTE network. On the other hand, Dish would get into partnership talks with the Kansas carrier to construct its own network, while Sprint could be benefited from Dish’s spectrum which can be best used to offer mobile service. Ergen seems very keen on joining forces with Sprint and says ‘Sprint and Dish match up pretty well with where our spectrum is’.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.