Dish turns to celebrity pitchman while shuffling cash around

Dish Network announced retired pro football player Deion Sanders will headline a new advertising campaign for the company's Boost Mobile prepaid brand.

The company's new advertising campaign coincides with efforts by Dish to finance its 5G network buildout with parent company EchoStar.

However, it's unclear whether Sanders will be enough to move the needle for a company that has been steadily losing mobile customers since it entered the US wireless industry roughly three years ago. Moreover, Dish's competitors are not standing still: T-Mobile, MobileX and Charter Communications all announced new retailing efforts this week geared toward growing their own respective customer bases.

Regardless, Dish officials cheered the company's new ad campaign. "Congratulations to Sean Lee, Katie Flynn and the entire Boost Mobile marketing team for bringing our partnership with Coach Prime to our customers and our local communities today," wrote John Swieringa, Dish's president of technology and chief operating officer, on social media. "Our nationwide operations and technology teams at EchoStar Corporation are ready to support an awesome experience for our customers on the Boost Wireless Network."

Deion "Coach Prime" Sanders is a pro football Hall of Famer and the current head coach of the University of Colorado Buffaloes. Under Dish's new campaign with Sanders, the company will offer a "Coach Prime" edition of the Motorola Razr folding smartphone for $149.99, or free for customers who sign up for Boost Mobile's $60 per month plan. All Boost customers who purchase the new Coach Prime Razr within its first month of availability could also receive a surprise phone call from Sanders.

"I grew up watching Deion in Atlanta and am beyond thrilled to have Coach Prime on our team," said Dish's Lee, the company's SVP of marketing for Boost Mobile, in a release.

Dish lost 123,000 Boost prepaid subscribers in the fourth quarter of 2023, widened from a year-ago loss of 25,000. That leaves Dish with 7.38 million Boost subscribers – far below the roughly 9 million it purchased from T-Mobile in 2020.

Earlier this year, Dish officials suggested 2024 would be a "transition year" for the company's mobile business.

Following the money

EchoStar and Dish merged last year, combining Dish's satellite, streaming, retail wireless business and emerging 5G network with EchoStar's satellite-focused business. The move was partly aimed at freeing up cash for Dish's 5G network buildout.

And according to a new report from the financial analysts at New Street Research, that's exactly what the companies have been doing. Citing the company's newest SEC filings, the analysts outlined a series of complex financial transactions designed in part to shuffle cash from EchoStar to Dish's 5G operation.

"We show that Networks needed a $0.4BN advance from DBS in 4Q23 to get to the end of the year. Then in 1Q24, Networks had a cash burn of ~$0.5BN, and maturing debt of $1BN, for a collective funding need of $1.5BN," wrote the New Street analysts in a note to investors this week, citing EchoStar's various business units including DBS, Networks, Hughes and others. "Networks sold spectrum to EchoStar for 'about $1BN,' which was funded in turn by a $1BN dividend from Hughes. It is unclear how the remaining $0.5BN was funded. We suspect this was through a further advance from DBS. Finally, EchoStar purchased the minority interest in SNR, liquidating the cash at EchoStar (there is still $1.1BN of cash at operating subsidiaries)."

SNR is one of the companies Dish worked with during the FCC's AWS-3 spectrum auction.

Broadly, the New Street analysts speculated that Dish will need to raise around $1.5 billion in additional cash by November to meet its debt obligations. "Dish has plenty of very valuable spectrum that can easily be leveraged to secure the requisite funding," they wrote.

According to its website, Dish's 5G network is now available across around 70% of the US. "We're continually adding more towers every day, so stay tuned," according to the company, which listed Boston and Los Angeles among the company's still-to-launch markets.

To be clear, Dish and its Boost Mobile brand isn't the only wireless player working to improve its retail footing. For example, just this week Verizon MVNO MobileX announced it's now selling new and refurbished devices from Apple, Motorola and Samsung on its website.

Separately, T-Mobile announced it's now the exclusive wireless provider inside Sam's Club retail locations. And cable company Charter, a Verizon MVNO operating under the Spectrum Mobile brand, announced a new Anytime Upgrade program that "allows new and existing customers to upgrade their phones whenever they want, as many times as they want."