Satellite broadcaster Dish Network is in talks to merger with telecommunications provider T-Mobile U.S., according to a Wall Street Journal report, in another potential deal that reflects the increasing need of content producers and content distributors to gain scale and size in order to stay competitive in an industry that has been disrupted by the rise of digital technology.
Under the terms of the deal being proposed, Charlie Ergen, chief executive of Dish, would become chairman of the new company while T-Mobile CEO John Legere would serve as the company’s CEO, according to the report, which cited people familiar with the matter.
A spokesman for Dish declined to comment. Financial details of the agreement were not disclosed in the report and could not be immediately learned.
The proposed merger, which the Journal said was only in its formative stages and was not guaranteed to be completed, is the latest attempt by media and technology concerns to maintain size and scale in an industry that has seen its consumer base splintered by emerging technologies like video streaming and mobile devices. Charter Communications is in the midst of trying to assimilate Time Warner Cable and Bright House Networks to create what would result in being the nation’s second-biggest cable operator. AT&T and DirecTV are believed to be nearing the end of the process for a merger that would engender a massive pay-TV operation. And Verizon Communications recently agreed to purchase AOL to gain access to ad-serving technology that would further its efforts to monetize content distributed via mobile devices.
Dish has long seemed like a company that could use a partner. Under Ergen, Dish has accumulated billions of dollars worth of wireless-spectrum licenses but has yet to put them to full use. What’s more, the company’s broadband subscriber base is small. Yet Ergen has a reputation as a fiercely independent industry maverick, and can be a hard-nosed negotiation. Dish has tangled recently with both Time Warner and 21st Century Fox, letting popular cable networks like CNN and Fox News Channel go dark as Dish and those companies haggled over carriage terms.
If both Dish and T-Mobile and AT&T and DirecTV both merged successfully, the nation’s two biggest distributors of video content via satellite would both be assimilated into broader telecommunications companies.