Regarding DISH’s (NASDAQ: DISH) request to federal court for more time to purchase 800 MHz licenses from T-Mobile (NASDAQ: TMUS), New Street Research Policy (NSR) Advisor Blair Levin offered his thoughts. Originally, DISH was supposed to exercise the option to purchase the licenses by June 30 of this year. DISH sought an extension to August 30, 2023, which the Justice Department granted. Now, DISH is seeking another extension.
NSR believes the DOJ could well grant DISH’s latest extension request. “From a competition perspective, there is no harm in granting the request and there may be harm in rejecting it,” Levin writes in a client note. NSR believes the DoJ will prioritize the potential impact on competition as it evaluates the request.
“Denying the request will result in DISH never being able to obtain an asset the DoJ viewed as essential for it to successfully enter the wireless market,” states Levin. Further, he asserts, forcing T-Mobile to auction the spectrum now would probably result in either AT&T (NYSE: T) or Verizon (NYSE: VZ) controlling the spectrum, which shuts the door on a future new entrant. That’s a result the DoJ is “unlikely” to want, according to NSR.
Also, DISH’s request gives the DoJ a solution to the problem the merger created, notes Levin. “DISH is not trying to get out of a condition it asked for to allow the deal to move forward but rather, it is trying to extend the timing to enable the condition that TMUS agreed to be realized,” he writes. That’s another reason that NSR believes the DoJ is likely to grant DISH flexibility.
However, Levin notes the court is the decision-maker on the extension but the DoJ’s input is key. The court will decide whether to grant the request to modify the final consent decree.
Overall, what happens is a close call. If the DoJ supports the DISH request, the court is likely to grant it. But if the DoJ stays silent or opposes it, the court is likely to reject it, according to NSR. So far, the DoJ has been silent. It could have joined the DISH request, or it could have filed its own request with the judge, notes Levin.
NSR understands that T-Mobile has 14 days from August 17 (the date of the DISH filing) to file a response. NSR believes T-Mobile is likely to oppose the request. DISH then has seven days to respond. Therefore, expect a decision in a month or two.
By Leslie Stimson, Inside Towers Washington Bureau Chief
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