AT&T passed on Dish deal because of regulatory concerns, BUT.....
but Dish could still team with Sprint or T-Mobile (or both)
May 21, 2014 | By Mike Dano
Speaking at the J.P. Morgan Global Technology, Media and Telecom Conference, AT&T (NYSE: T) CFO John Stephens said the carrier considered a purchase of Dish Network's (NASDAQ: DISH) spectrum holdings, but ultimately decided against making a move over concerns that regulators at the FCC and Department of Justice might squash the deal. The FCC's upcoming spectrum auctions--AWS-3, scheduled for later this year, and the 600 MHz auction scheduled for next year--also pushed AT&T away from a transaction with Dish and toward a purchase of DirecTV (NASDAQ: DTV), Stephens said.
"Dish has spectrum. And that spectrum would raise additional regulatory scrutiny and questions at a time when some FCC spectrum auctions are scheduled," Stephens said.
Specifically, the Journal noted that Dish could attempt to make a deal with T-Mobile if Sprint's purchase of T-Mobile is blocked by regulators. And a partnership between Dish and T-Mobile would be aided by the rumored $1 billion breakup fee that Sprint would have to pay T-Mobile if their merger were to fail. Indeed, officials at the FCC and DoJ have made it clear that they are interested in retaining four nationwide wireless providers.
(As a side note, BTIG analyst Walter Piecyk pointed out that Sprint and parent SoftBank could appease regulators by promising to adhere to strict net neutrally guidelines in a merger with T-Mobile.)
And, if Sprint and T-Mobile are successful at a merger, Dish could ultimately partner with that combined company