U.S. direct-to-home satellite company Dish Network has made a $25 billion bid for third place mobile carrier Sprint. Here’s what it might suggest for the future of video…
By Paul Marszalek
BBG Office of Strategy and Development
What would the #2 direct-to-home satellite provider want with the #3 mobile carrier in the U.S.?
Perhaps Dish Network has seen the recent BBC Licensing study that showed increased use of phones and tablets for consuming content from the BBC’s iPlayer. And then there was the related nugget that the number of televisions in U.K. households is actually decreasing – even while video consumption is increasing.
Or maybe Dish Network saw Ooyala’s Global Online Video Index for 2012 that showed increased consumption of live video streams as well as a doubling of tablets’ share of video viewing in the past year.
Or perhaps they combined the increasing body of evidence that consumers are moving to smaller, not larger screens with Ericsson’s prediction that 85% of the globe will be covered by 3G mobile broadband by 2017 (and half of that will be 4G).
Connect the dots here and one quickly sees this move as a matter of survival for Dish Network. Collectively, the data may largely amount to early forecasts, but Dish is betting $25 billion that video on handheld devices is going to be where the money is.
Currently unable to provide high speed internet, Dish risks getting made obsolete by mobile carrier Verizon and its fiber optic IPTV sister FiOS, or AT&T and its U-verse cable partner.
In fact, Dish has been methodically acquiring spectrum for some time – possibly seeing the future where traditional cable companies like Comcast get hurt by mobile broadband carriers that can deliver any media anywhere. Think about a phone or connected tablet package that delivers phone, internet, and a complete cable package. That’s what’s coming if this deal comes through — the potential for the phone companies to rule the media landscape.
With 14 million subscribers currently as a satellite TV provider, Dish would roughly triple in size by adding Sprint’s nearly 56 million customers – and immediately start luring many away from their current cable providers.
For the BBG and other international broadcasters, this may be a hint of things to come in developing markets. We’ve already experienced how much of the globe leapfrogged landline telephones for mobile, and cable TV for satellite.
This could be the next leapfrog. It is extremely likely that many Africans will experience their first “cable TV” package not via satellite, but on a tablet over 3G, 4G, or wifi.