Dish’s prepaid losses grow in Q4 ahead of Infinite postpaid launch

Dish Network is still losing Boost Mobile prepaid customers, but the pace of its losses has slowed considerably. In some preliminary results that Dish released yesterday, the company reported a net loss of 24,000 Boost prepaid subscribers in Q4, which is an improvement from a year ago when the company reported a net loss of 245,000 Boost Mobile subscribers. Dish ended the year with 7.98 million wireless subscribers, down from 8.54 million at the end of 2021.

Roger Entner, founder of Recon Analytics, said that Dish’s prepaid performance in the quarter isn’t that bad considering that prepaid wireless is a difficult business, particularly if a company doesn’t focus on a specific demographic group or niche. “Prepaid is constantly swimming against the tide,” Entner said. “It’s a difficult business, and there is always churn.”

Entner said one example of a successful prepaid MVNO is Consumer Cellular, which targets senior adults. Consumer Cellular doesn’t have high churn, he said. “These people have found a home, and they don’t change.”

Unlike Consumer Cellular, Entner said that Boost “stands for nothing and has no niche.” He also said that many wireless customers want new devices, and Boost doesn’t provide subsidized new devices because it’s a prepaid provider.

Financial analyst Craig Moffett of MoffettNathanson said in a research note that he expects Boost to have more success in wireless when the company launches its new Infinite postpaid offering this quarter. “The Boost business is today just a placeholder for what will eventually be a much more substantial hybrid MVNO/MNO,” he said, adding that it’s difficult to not gauge Dish’s prospects by looking at its prepaid results.

However, Moffett also said that Dish will need to be aggressive with its Infinite pricing and/or offer large handset subsidies in order to compete in the very competitive postpaid market.

Progress in 5G

Dish also revealed that as of the end of 2022 it had started construction on more than 15,000 5G cell sites. When complete, those sites will cover more than 60% of the U.S. population. According to a research note from New Street Research, if Dish continues on its current rate of deploying 1,000 5G cell sites per month, it will need 17,500 sites deployed to hit its coverage target of covering 70% of the U.S. population by mid-June.

“At its current pace, Dish will have started construction on 17,500 sites by March, leaving it 2.5 months to complete construction and fine-tune the deployment,” New Street said.