Unpacking the DISH/Republic Wireless Deal

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Republic Wireless employees and subscribers woke up to a surprise last Monday, when the MVNO announced that DISH is buying the company’s brand and customers for an undisclosed amount. 

The MVNO doesn’t report financial information, but said two years ago that annual revenue was approaching $100 million. Republic Wireless has just 200,000 subscribers, so clearly a big portion of revenue comes from other sources — probably its Relay push-to-talk device, which will continue as a standalone company after Republic becomes part of DISH. 

Republic joins DISH’s other MVNO properties, Ting Mobile and Boost Mobile, which it was required to buy from T-Mobile as a condition of the T-Mobile/Sprint merger. Boost shed 575,000 subscribers during the second half of 2020; now DISH is replacing roughly 200,000 of those with the Republic Wireless customer base. All DISH’s MVNO customers will use the T-Mobile network for now. (Ting also uses the Verizon network.)

Republic Wireless is a WiFi-first MVNO, like Google Fi. Smartphones with Republic SIM cards default to WiFi when they can, and roll over to the T-Mobile network when they need to. 

The company pioneered WiFi-to-cellular handover in 2013, then cellular-to-WiFi handover in 2015, and then in 2016, it introduced bonded calling technology. This enables cellular to kick in to support WiFi calling when needed, without actually moving the customer off the WiFi network. 

Bonded calling can work with 5G, which could come in handy for DISH as it rolls out its fledgling 5G network. Its deal with Republic does not include the company’s patents, but DISH will be able to use Republic Wireless’s WiFi calling technology. 

Using available WiFi to supplement its network could help DISH keep its early customers happy as it races to offer service to at least 20 percent of Americans by June 2022, in order to meet a deadline set by the FCC. 

WiFi calling came of age during the COVID-19 pandemic, as millions of homebound workers used Voice-over-WiFi to make calls on their mobile phones when signal was spotty or minutes were running out. The major carriers reported huge spikes in WiFi calling last spring, and consumers reported high levels of satisfaction with the technology, if they even knew they were using it. Many didn’t even realize their phones were automatically moving to WiFi when the cellular network became congested.

Republic Wireless subscribers appear to be more tech savvy than most, and also more price conscious. CEO Chris Chuang told customers that DISH and Republic “expect to have exciting new products and services available in the future,” but if those services force customers to pay more each month, many are likely to move to competitors like Verizon’s Visible.

The DISH 5G network

A big question for DISH is how quickly it will transition its Boost, Ting and Republic Wireless MVNO subscribers from the T-Mobile network to its own. Until that happens, the pricing it can offer subscribers will be at least partially dependent on the price DISH has to pay T-Mobile for network access. 

For now, the DISH 5G network remains two-dimensional. Deals are in place for sites and equipment, and executives have been hired to oversee deployment, but no one is climbing towers to install DISH radios yet. 

DISH has said it will cost $10 billion to build its greenfield 5G network, and analysts have predicted that the company will ultimately need to spend much more to create a nationwide network. Unlike other wireless carriers, DISH has not stated publicly what it plans to invest in its network this year. Meanwhile, AT&T has projected $21 billion in capex for 2021, Verizon has estimated $18 billion and T-Mobile predicts up to $12 billion. (For AT&T and Verizon, capex projections include wired as well as wireless.) 

DISH projects a network deployment cost structure that will be radically different from those of its competitors, thanks to ORAN and a lack of legacy network equipment and commitments. But it’s going to take time to build a brand-new network that will integrate technology from multiple vendors. 

During that time, DISH is likely to shed more MVNO subscribers if it doesn’t keep prices low. But given the recent history with Boost, it’s not clear that subscribers have a huge business value to DISH right now. Republic brings only 200,000 subscribers anyway, and it seems likely that this deal may ultimately be about access to the Republic Wireless engineers and technology. 

By Martha DeGrasse, Inside Towers Contributing Analyst

Veteran telecom industry editor and journalist Martha DeGrasse is an Inside Towers Contributing Analyst with features appearing twice per month. DeGrasse owns Network Builder Reports and contributes regularly to several publications. She was formerly a writer and editor with RCR Wireless and a TV business news producer.

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