Dish thinks T-Mobile has stretched the argument

Dish Network (DISH) has reservations about T-Mobile (TMUS) and Sprint (S) merging. The company has written to US regulators reviewing the T-Mobile–Sprint merger proposal to block the two wireless providers from combining, according to a Reuters report citing government filings. Dish argues that T-Mobile and Sprint have exaggerated their arguments for a need to combine and that a merger of the two would result in higher prices for wireless consumers.

Why Dish Is Uneasy about a T-Mobile–Sprint Merger

Cable companies expanding into the mobile business

Dish is in the process of building a wireless network, which would see it join cable peers Comcast (CMCSA) and Charter Communications (CHTR) in offering mobile services as a way of diversifying their businesses.

Comcast began offering mobile services last year while Charter launched its wireless service in June. Altice USA, another cable company planning a wireless venture, also opposes the T-Mobile–Sprint merger deal in its current form.

T-Mobile and Sprint were at some point viewed as merger or partnership candidates for Dish. Because cable companies are venturing into the mobile business, T-Mobile and Sprint argue that there is a need for them to join forces to take on the growing competition. They have also pledged to contribute to $40.0 billion toward network investments if allowed to combine.

Dish beat revenue estimates

Dish is working to diversify into the mobile business at a time when its core pay-TV business is under pressure from online video services. As a result, some households are dropping their cable television subscriptions.

The company lost 192,000 traditional pay-TV customers in the second quarter. However, it was still able to report revenues above the consensus estimate. Its second-quarter revenues reached $3.5 billion against $3.4 billion that analysts expected.

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