Dish's 5G gets real: Company inks massive Crown Castle tower dealDish's 5G gets real: Company inks massive Crown Castle tower deal
The work of physically installing radios on top of cell towers is often the most expensive part of any wireless network buildout. Dish Network said it will use 20,000 Crown Castle towers for 5G.
November 16, 2020
Dish Network appears to be getting serious about its 5G network buildout plans.
After months of inking relatively minor vendor agreements – for example, its deal with DigitalRoute involves a "cloud-native Usage Data Platform to monetize new 5G services and complex business models" – Dish said Monday it will lease space on up to 20,000 cell towers from Crown Castle.
While the companies did not disclose the value of the transaction, it could well be worth billions of dollars. After all, T-Mobile recently signed an agreement with American Tower that's worth $17 billion over 15 years.
The work of physically installing radios on top of cell towers is often the most expensive part of any wireless network buildout.
However, Crown Castle's stock was down slightly immediately after the companies released news of their agreement, while Dish Network's stock was up slightly.
Neither Dish nor Crown Castle offered much in the way of detail about their agreement. In a brief release, the companies said it was a "long-term agreement" that covers the entire US and also involves "certain fiber transport services," which means that Dish could backhaul its traffic through Crown Castle's fiber networks. It also includes the potential for "pre-construction services," which means that Crown Castle's engineers could help with the physical work of hoisting Dish's radios atop Crown Castle's towers.
Analysts generally cheered the move.
"We view this deal as positive for Crown Castle and for the tower sector more broadly," wrote the financial analysts at New Street Research in a note to investors issued immediately after the companies announced their deal. "Crown Castle accounts for 30% of the US tower market, which could suggest that Dish intends to build to 65,000 towers if Dish's network build is evenly distributed across the tower companies. We suspect this announcement implies that Dish will prioritize Crown Castle towers wherever they have a choice, which could mean that Crown Castle captures greater share of Dish's cell sites. Still, it seems that Dish plans to build to more than the 50,000 [towers] that we had assumed for their initial phase, so all of the [companies that provide cell] towers are likely better off than we initially expected."
Some financial analysts seem to be more fully embracing Dish's 5G prospects. For example, the financial analysts at Raymond James late last week reiterated a "Strong Buy" rating on Dish's stock and raised their stock-price target to $58 from $50.
"We believe Dish presents an attractive option on the 5G future, partially funded by cash on hand, the cash cow pay-TV business and now the wireless retail, and in the future, wholesale business," they wrote in a note to investors.
Dish is required to construct a 5G network in the US based on its 2019 agreement with T-Mobile and the US Department of Justice. In recent months, Dish has begun assembling its vendors, including radio suppliers like Fujitsu and silicon suppliers such as Intel and Qualcomm.
Dish is required to cover 20% of the US population by June 14, 2022, and faces additional buildout goals in the years beyond. If Dish fails to meet its coverage goals, it could lose its spectrum licenses and pay up to $2.2 billion in penalties.
About the Author(s)
You May Also Like
5G Network Automation and AI at Global Megaevents: A Telco AI-at-scale case study with Ooredoo and EricssonOct 10, 2023
5G Transport & Networking Strategies Digital Symposium.Oct 26, 2023
Improve Service Efficiency in the Call Center and Field with Slack AutomationOct 13, 2023
Open RAN Evolution Digital Symposium Day 1Jul 26, 2023