Further Prepping DISH For Its Future
By IoTComplete’s Jimmy Schaeffler
(August 7, 2014; Carmel-by-the-Sea, CA)
As he typically does, DISH Network’s (NASDAQ: DISH) chairman, Charlie Ergen, occupied most of an 80-minute quarterly analyst call on Wednesday, August 6, handling the majority of 60-minutes’ worth of Wall Street financial analysts’ questions, and the bulk of the 20-minutes’ worth of reporter’s “media” questions.
After the call, the media wrote about some to-be-expected topics, such as why DISH didn’t buy DirecTV; what Ergen thinks about Over-The-Top (OTT), broadband, and mobile opportunities; and what happens with the forthcoming spectrum auctions.
Yet, more importantly than most media and analysts observed, Mr. Ergen stated numerous times on the call, that he wants DISH Network to be thought of as a company, and as an equity and/or debt investment, that investors make for the long haul. Especially in that light, most media somewhat dropped the ball on the August 6, 2014, 2d Q DISH analyst call. This is because not a single media writer wrote anything about the details of one of the two core things Charlie Ergen spoke about as having to do with the real long-term viability of DISH Network. And that is because not one media (that we searched for and observed) wrote about (or wrote any of the details about) Mr. Ergen’s comments concerning the Internet of Things (IoT), and its star child, Machine-To-Machine (M2M) businesses.
Clearly, for the long-term, Mr. Ergen and his team are already focusing on IoT/M2M, and how DISH will be ahead of that curve. That is yet another reason why savvy investors – those looking at years instead of days, weeks, or even months – might be wise to reconsider DISH as a long-term play of unique and significant value.
DISH and The IoT/M2M Phenomenon
Charlie Ergen has always been a visionary. Regular meetings with him through the years have witnessed discussions ranging from future business plans before DISH Network even launched (way back in 1994), to more recent dialogue focused on DISH’s net neutrality, mobile, and broadband futures.
Thus, it is entirely in keeping with Charlie as a Media Soothsayer, that he would, in the middle of 2014, step several feet ahead of the competition (as he did long ago relative to DirecTV and their respective mobile spectrum plays), and already be looking deeply into the IoT.
The DISH-IoT Vision, Inside and Beyond Video
Specific IoT items and examples Mr. Ergen mentioned were first the idea that the computer power inside every consumer device, coupled with the instant and permanent connectivity that comes by way of the Internet, creates a world where that coupling becomes the rule, not the exception.
Within that realm, examples Mr. Ergen offered include a smart phone that is tracked wherever it is carried, and via location based services (LBS), the device then communicates with the smart phone user about products and services and ads for those, such that they can be purchased instantly and shipped, with a single push of button on that amazing smart phone.
That coupling makes the transaction so much more seamless, and a company that owns the pipe used for that ad and transaction, and that has figured out how to effectively maximize revenues — because that company has studied and understands the ecosystem — will have an advantage both in the marketplace and over its competitors. Facebook’s mobile ad revenue increasing in two years from nothing to 62% was cited by Mr. Ergen as an example of this phenomenon.
Opined Mr. Ergen, “…we think it will be important to pay for subscription TV, get pay-TV, get it wherever you are, get it on all your devices, and get ads that are streamed to you that are meaningful to you. Five years from now, you’re just not going to see an ad of an airplane flying with music saying – a branding ad that says ‘fly the friendly skies’– nobody’s going to say that. The ad’s going to say ‘book a ticket, push the button’… that’s going to be a better ad.
“You’re not going to have a Starbucks ad with somebody sitting behind — talking about ‘we brew coffee.’ It’s going to be, push the button to say what size cappuccino do you want? Advertising’s going to change.”
IoT + Video
Moving beyond an IoT focus on video, Mr. Ergen further predicted IoT for strong sums of incredibly valuable data. “The other thing about wireless networks is the number of devices, the number of things that will be connected to the network, that is going to grow by 10 times what it is today. Every car, every pet, every child, every refrigerator, every camera, every security system, every watch, every machine is going to be connected wirelessly to a network.
“Today, you’re seeing growth in wireless on tablets. That’s where most of the growth is coming from. But, in the future, it’s going to be all those other devices,” Ergen added.
Wrapping up the topic, Ergen noted, “…and most people look at the world as it is today, and they say ‘right;’ but I look at it as ‘everything’s going to be connected.’ In my lifetime, the only way you’re going to connect it all is through wireless spectrum. Someday, there will be other ways to do it; there will be photons, there will be some other way to do it. But, in my lifetime, it’s going to be wireless, and you’re going to want to be connected and you’re going to be happy to pay for it.” (See, this website, the article “IoT 101: The 4 Basics“).
It is also interesting to note that the Ergen response was the result of a question asked by the best (and one of the smartest) analyst on the call last week, Craig Moffett (www.moffettnathanson.com), who also has been focused on the media/telecom space for decades now. Perhaps Craig was testing Mr. Ergen, to see if Charlie really was looking ahead and professing a true passion for, and understanding of, DISH’s longer-term future?
Incidentally, Mr. Ergen has indeed clearly taken these core, highly-recommended steps that literally every business must take, and that were discussed in this www.IoTComplete.com article from last week (See, “The Internet of Things Lights Your Business…Today,” http://www.IoTComplete.com).
Jimmy Schaeffler deploys his expertise and professionalism at IOTComplete.com to fully light the burgeoning worlds of IoT & M2M. By focusing on the professional consideration of news, opinion, research, and concrete tactics and strategies, the IoTComplete.com aim is to provide a top-level, one-stop resource for publication, consulting, conference and speaking needs. The IoTComplete.com business is designed toward helping companies, governments, and institutions grapple with the new realities, strategies, and planning necessary to thrive in the IoT & M2M era faced by every person and entity globally. Visit www.IoTComplete.com for more detail.