Dish Network is tapping Tucows’ technology platform for its newly acquired wireless retail business and has added more subscribers with the purchase of Ting Mobile assets as part of the deal.
Ting parent Tucows said Dish is its first mobile technology customer, using the company’s Mobile Services Enabler (MSE) platform for functions like billing, activation, provisioning and funnel marketing.
Dish officially entered the wireless retail space on July 1 when it closed a $1.4 billion deal to acquire prepaid brand Boost Mobile from T-Mobile, with around 9 million subscribers. Ting Mobile had about 271,700 subscribers (PDF) at the end of March, "most" who became part of Dish effective August 1.
The MSE relationship first applies to Ting Mobile and will be added to Boost Mobile customers in the second half of 2021. Tucows said it will still own the Ting Mobile tech stack.
Dish's use of Tucows’ MSE platform is one of the main primary elements of the transaction, according to Jeffrey Moore founder of Wave7 Research, which closely tracks the prepaid and postpaid market.
“These kinds of platforms can be very important...and make things much more efficient for large carriers,” Moore told Fierce.
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New Street Research analyst Jonathan Chaplin wrote in a Monday note to investors that Tucows will likely help manage parts of Dish’s retail wireless business so that management teams can put focus and energy into the more critical wireless network build and wholesale business.
John Swieringa, Group President, Retail Wireless and Dish COO, in a statement said the agreement “will accelerate our digital and operational capabilities in wireless.”
While the platform is a big part, “it’s also true that this puts Dish more deeply in the prepaid market,” Moore said, with the acquisition of Ting Mobile subscribers as the other main element. He acknowledged that Ting Mobile's total customer count is fairly small overall, but still adds to Dish’s prepaid subscriber tally.
"It sounds like Dish plans to keep the Ting brand, which now gives Dish two brands in the prepaid market," he said.
Like Boost customers, Dish said Ting Mobile subscribers will have access to the new T-Mobile network. That’s part of a 7-year MVNO agreement between T-Mobile and Dish, as the latter works to build out its own greenfield 5G wireless network to become a fourth nationwide facilities-based competitor.
Ting Mobile has relationships with major carriers other than AT&T, including legacy Sprint, T-Mobile and Verizon. Last summer the MVNO indicated it wouldn’t renew its network service provider agreement with T-Mobile, something that didn’t ultimately end up happening.
In a December video, Ting said it wouldn’t drop any networks but that CDMA SIM card support from Verizon would be added.
Today’s announcement didn’t mention access to Verizon’s network and a Dish spokesperson wasn’t immediately available for comment. Ting customers won't experience any disruptions in service, according to Dish. Moore expects sales of Ting on Verizon’s network will take a step back and new customer activations to focus on the new T-Mobile network.
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As for acquiring Ting Mobile subscribers, New Street analysts didn’t attribute much value to the move, noting ARPU of $37, churn of 3.25%, gross margins of 60% a and subscriber acquisition costs below $100.
“We estimate these characteristics would support a customer lifetime value of $583, or a valuation of nearly $160MM for all subs; however, the subscriber base has been declining, reaching 4% declines in 1Q20, so this valuation may be optimistic,” wrote Chaplin.
Ting also has a toehold at national retailer Best Buy, which Dish might be interested in going forward, Moore noted. Boost Mobile was pulled from Best Buy ahead of Dish’s acquisition and Walmart is the only national big box store it’s sold at.