If there is any question people are asking about Dish Network, it is ‘Is Dish Network going out of business?’ In the first quarter of 2023, Dish Network’s core satellite TV business experienced significant losses that further dampened the future of the company.
Over the past few years, Dish Network has lost millions of satellite subscribers. This has led the company’s founder, Ergen, to take a big step – investing heavily in a grand plan. His vision was to create a powerful 5G wireless network that could serve 70 percent of the United States by summer.
However, the 5G plan has not been going as smoothly as hoped. In fact, it has hit a roadblock, causing concerns about the future of Dish Network. To make matters more complex, there’s a possibility that the FCC, which oversees communication regulations, might even push Ergen to give up the valuable 5G spectrum he had spent billions to acquire in government auctions.
All these come together to make people start asking: Is Dish Network going out of business? Of course, that’s a subject worth exploring. So, in this post, we will be showing you important things you need to know about this company and what the future might hold for them.
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Is Dish Network Going Out of Business?
Well, to make the answer short, Dish Network might be going out of business soon if nothing changes about its financial status.
In recent years, the company has been confronted with a significant drop in its satellite subscriber numbers. This loss of millions of satellite subscribers has raised concerns about the future of the company’s core business. Even with the company’s founder, Ergen’s plan to make things better for the company through his 5G plans, it seems it has further dampened the future of the company.
The progress of the plan has been slower than anticipated, which is making the company spend more on the project than initially thought. At the same time, the delay may make Federal Communications Commission (FCC) soon force Dish Network to relinquish the project in action, making them lose billions of dollars.
During a recent earnings call in the first quarter of the year, Ergen openly acknowledged Dish Network’s substantial debt. But he also said despite all of these, Dish Network will bounce back to its feet just like it has always done when faced with such a situation – right from the time it was launched.
Yet, some voices in the industry raise a different perspective. An anonymous industry official pointed out that this situation might be completely different from the past. This individual emphasized that Dish Network might need a “white knight” – a savior to rescue them from their current financial predicament.
Without such intervention, the company might be left with no choice but to explore all possibilities, including the option of bankruptcy. So, if no tangible development happens soon, Dish Network might be going out of business!
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Some Reasons Dish Network Might Be Going Out of Business Soon
Perhaps you have also wondered why people are asking, ‘Is Dish Network going out of business?’ You will be surprised that the issue transcends more than just their subscriber count drop and 5G adventure. Let’s take the section to look at some issues happening behind the scene of Dish Network.
#1: Steady Customer Losses
Dish Network is facing a steady decline in customers across its core businesses: DISH TV, Sling TV, and wireless services. The DISH TV segment lost 595,000 net subscribers in 2021, totaling 2.81 million since 2017. Consumers are choosing to “cut the cord,” leaving traditional satellite TV behind. Efforts to raise prices to improve profits have backfired, resulting in even more subscriber departures.
Sling TV, designed as an Internet-based solution for cord-cutting, struggled too. Over four of the last eight quarters, it lost subscribers, with only 175,000 out of 2.48 million remaining.
#2: Faltering 5G Bet
This is another major concern that is making people ask, ‘Is Dish Network going out of business?’ Dish Network made a significant $36 billion investment in spectrum (radio frequencies for better bandwidth) to build a pioneering cloud-native 5G network.
However, the execution is experiencing lots of challenges. The initial rollout, first planned for March 2020, was delayed to December 2021 and further to June 2022. Unlike its competitors, Dish is building its 5G network from scratch, underestimating technical demands, and spending around $10 billion.
And now, there’s a risk that the FCC could revoke $4.3 billion worth of spectrum licenses if the company failed to meet deadlines, which is very much imminent. Dish’s progress, according to Ergen, is reassuring yet concerning: “We’re going to get there, but we’re not there yet.” Even if the 100-day deadline is met, Dish must still provide 5G broadband to 70% of the U.S. population by June 14, 2023.
#3: Impact of Blackouts
Dish Network also recently faced a notable dispute with Nexstar, leading to a historic blackout where its subscribers lost access to over 160 local channels for three weeks. Similar to rival DirecTV’s dispute, this likely pushed some customers to leave or sour on Dish’s service. This is partly one of the reasons for the massive Dish Network’s subscriber loss.
#4: Dish Network Selling Off Assets
It is just normal to ask, ‘Is Dish Network going out of business?’ when you hear that the company is now selling off some of its assets. Of course, that is the present position of the company.
Amidst growing bankruptcy speculation from insiders, Dish Network appears eager to sell assets and raise funds. The goal of achieving 70% coverage of the U.S. with a 5G wireless network is now in doubt – the company might not be able to afford to complete the project.
So, rumors suggest that Dish’s CEO, Charlie Ergen, is urgently trying to sell non-core assets to finance crucial endeavors. However, these potential asset sales might not make a significant financial impact. Despite exploring various partnership options, none also seem to be progressing as hoped.
Is Dish Network Going to Have a Merger Soon?
Despite Chairman Charlie Ergen’s repeated claims that a Dish-DirecTV merger is “inevitable,” the certainty of this prospect is now in question. The two companies have come close to merging before, with near-deals falling through.
Last year, AT&T sold a stake in DirectTV to form a new company with Dish Network. But with the look of things, it doesn’t seem like Dish is very much interested in the deal, and there have also been some indications that government regulators might not approve such a merger.
Is Dish Stock Worth Buying?
Dish Network stands at a serious crossroads, marking its most significant turning point in 26 years. However, considering the company’s current stagnation and track record of delays, achieving this massive endeavor without future setbacks seems unlikely.
You might need to diligently monitor updates on Dish’s 5G network rollout, especially in relation to the FCC’s deadlines on June 14, 2022, and June 14, 2023. These milestones will reveal whether the company can deliver on its lofty promises. Until the company is able to successfully launch its 5G network and establish its private network contracts, investing in the company might not be a very wise decision.