Good day, welcome to the DISH Network Corporation Quarter Two 2021 Earnings Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Tim Messner. Please go ahead, sir. All right. Good morning, everyone. Thanks for joining us. We're joined on the call today by Charlie Ergen, our chairman, Erik Carlson, our CEO, Tom Cullen, our EVP of Corporate Development, Paul Orban, our CFO, and on the wireless side, we've got Jeff Blum, our EVP of Regulatory Affairs, Stephen Bye, our Chief Commercial Officer, Dave Mayo, our EVP of Network Development. We're not going to be making any opening remarks today. We will start with the standard safe harbors. Statements that we make during this call that are not statements of historical fact constitute forward-looking statements that are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from historical results and/or from our forecasts. We assume no responsibility for updating forward-looking statements. For more information, please refer to the risks, uncertainties, and other factors discussed in our SEC filings. That's it, and with that, operator, we'll open it up to questions, and let's start with the analysts. Thank you. If you would like to ask a question please signal by pressing star one on your telephone keypad. If you are using a speaker phone please make sure your mute option is turned off to allow the signal to reach our equipment. Again it's star one to ask a question. We will pause for a moment for us to make queue for the questions.Thank you. Now we'll take the first question from David Barden at Bank of America. Please go ahead. Hey, guys. Good morning or good afternoon. Thanks for doing the call again. I guess a couple questions if I could. Congratulations on the AT&T network services agreement. Obviously, there's a lot of talk about it. I would love if maybe Charlie could give us a little background on how that deal came together, why it came together, and I think specifically, is this a vehicle for DISH to achieve its FCC coverage requirements, specifically the 70%, I think, coverage by June 2023? I think the second question I would have is obviously we're waiting for the Las Vegas network launch. I was wondering if you could give us a little bit of a roadmap between now and, say, maybe first half 2022, what the network build is going to look like, and what we should expect. I guess some of your partners in the infrastructure side have suggested that you've been contemplating a broad geographic build, and it would be great to get some more color on that. Thank you, guys. Okay, David. Dave, I'm going to have Dave Mayo talk about your second question on deployment and how that looks, and I'm going to make just an opening comment and throw it over to Stephen Bye on the AT&T question. Obviously, we're always looking for ways to improve things for our customers, and it's no secret that the CDMA shut off, premature shut off from T-Mobile was not helpful to the relationship. It was an opportunity for one of their competitors to work with us. That led to discussions that probably otherwise might not have happened. Make no mistake, T-Mobile's still super important to us and we're happy to have two really good companies that we can work with. It doesn't help us in the AT&T or T-Mobile, either one of those agreements do not help us in the CDMA shut off timeline, and AT&T doesn't help us in terms of meeting FCC milestones. I do think the agreement with AT&T is, from a big picture, I let AT&T speak for themselves, but I view it as certainly moderately positive for both companies and potentially extremely positive for both companies. With that, maybe I'll throw it over to Stephen and maybe give you a little more color on it. Just to add some more color to Charlie's comments. This is, as you've seen, a long-term strategic partnership that we have with AT&T. We went into it with sort of a win-win approach for both companies. It certainly creates value for both of us, which we feel is very important as companies, but also for our customers. One of the things that's very important in this relationship is the quality of the AT&T network as it relates to supporting our customers, and particularly our DISH customers that tend to skew more rural. They have a much better network and the quality network and reliable network in those markets. It allows us to go beyond our existing footprint that we serve with Boost today to broaden our distribution and address a different part of the market, given the quality of their network and the coverage. I think the other part of the relationship is, beyond being strategic, it is a long-term partnership. We've been working with them on how we manage the customer migration as well as the support for those customers, both on our network as well as the AT&T network. In addition to that, also with the T-Mobile network. It is a good relationship and one that we're working towards operationalizing as we go forward. The other thing to add in the relationship with AT&T is it is a broad running agreement, so it does give us in-market roaming in addition to out-of-market roaming for a long time. As you've seen, it's a 10-year agreement, so that's very important as it helps to support our build but doesn't remove any of our obligations on the build. With that, I'll hand it to Dave. Great. Thanks, Stephen. David, with respect to our build program, you might be aware we've implemented a very decentralized approach. We have four regions and 36 markets. The early markets that we'll be building are substantially all co-locations, hence the activity that you saw on some of the tower company calls this last couple of weeks. In that regard, we've signed substantially all the leases that are required to meet our 20% mandate for next June and have received notices to proceed on close to a third of the sites. We've commenced construction on close to 30 markets in 30 geographies within those 36 markets. In some cases, there may be multiple geographies within a market that we've commenced construction on. As to your Vegas question, we'll be substantially complete with the construction activities within the next 60 days, by the end of the third quarter, and as we've talked about, we will be beta testing customers in the fourth quarter. Great. Thank you guys so much for the call. We'll now take the next question from John Hodulik at UBS. Please go ahead. How quickly will you guys be able to migrate the traffic from the T-Mobile network to the AT&T network? Will, I guess, all new gross adds go right onto the AT&T network? As part of the announcement, they talked a little bit about cooperation on the infrastructure side. Could you talk about whether AT&T will be helping you guys light up spectrum? I know the 700 in particular fits well with what they're doing with their blocks of 700. Lastly, on the Las Vegas launch, just anything you can tell us about what that will look like once that network is lit up? Will you guys have retail pricing plans in the market, or will you be establishing a sales force to talk about distribution in the wholesale side and the business side, or just what should we expect once that network gets turned on? Thanks. Yeah, this is Charlie. I'll try to take some of those and maybe somebody else will want to jump in. In terms of transition from AT&T, obviously, AT&T will be our primary partner from an MVNO perspective going forward. That doesn't mean that we're transitioning our customers off of T-Mobile. They, again, remain an important part of what we're doing to the extent that they want to be an important part of what we're doing. One of the things that we'll do that relates to Las Vegas is obviously we have to be able to provision on AT&T, so that's going to take us a bit of time. We hope maybe somebody else on this call or maybe one of our guys can talk about that. Obviously some customers will want to move to AT&T to get the better network. Some people, the T-Mobile network will be better and they'll want to stay where they are. For new customers, big picture kind of thing is, our customers today, and for the most part, I think most customers across the U.S. that we talk to, they really want consistency and coverage as a priority. The speeds on 4G and LTE are normally fast enough for them, and they don't really see a difference in 5G when 5G pops up on their phone, so they're a little confused. Nobody can charge more for 5G in the U.S. today. Obviously for a new set of customers for us, we think the AT&T network has a tremendous coverage advantage that we don't have today, although T-Mobile is going to be a fast follower there as they build out rural America per their FCC milestones. The other part of it is that T-Mobile today probably arguably has an advantage, certainly in perception of 5G and probably in 5G build on their 600 MHz. While it doesn't really show up as a particular feature that customers can point to, it's still from a marketing perspective, I think they're considered the leader in 5G. Where 5G is important for our customers, that's going to be important. The key is going to be the 5G development, both our own development, which we think we're doing a little bit differently, but also as you get the big 100 MHz blocks in C-Band for T-Mobile, it's a race for those guys, and we'll see who does the best job of something that can differentiate 5G to consumers. That'll be the key. We're well positioned with both T-Mobile and AT&T, depending on who kind of wins that race, plus what we think that we're going to do different within 5G and our architecture that might be different than either one of those two. We're just well positioned. We get the best coverage and quality and value for that, but AT&T is going to be the primary going forward. With AT&T in terms of, Stephen touched on it, but there's other things beyond. I'd say it's probably moderately positive for both companies, but it could be extremely positive. You mentioned one, spectrum. We have spectrum, both have mirror images of 700 MHz. There might be some interesting things you could do there, and get scale and save cost if companies are so inclined. We share an interest in the 12 GHz spectrum. We have some spectrum that as we build out, will lay fallow for a bit until we build those out. It probably could be put to use sooner rather than later by AT&T. I think there's technology, where things are going, that our teams have committed to working together on, and we're buying other services from AT&T, like backhaul. That we have to buy from somebody, and since they're our partner now, they get to benefit the doubt on a lot of those deals. We're both in this, and we have common interests there. You can see this potentially could be a much better deal than the $5 billion that we're committed to. It may not. The companies may not get along. I think both parties realize that there are things that we can share that are beneficial to both companies, and we can do that. We will. I'm sure we'll remain frenemies. We obviously will compete with each other as well. As far as, I forget the question about Las Vegas. It's more distribution. Oh, distribution? Just what the service looks like when you guys turn that network on, or is it going to be in beta for the rest of the year, or do you actually start adding customers to it? I think we'll be in beta for a minimum of 90 days. You got to realize that kind of the things have changed maybe in the last six months, but we're going to put our network in the cloud, our core in the cloud and start that way. Even though we have a core working today that is not in the cloud, we decided we don't want to change, and we want to start with the core in the cloud, which hasn't been done by anybody here before. We obviously are doing O-RAN, so our baseband and radio vendors have to make sure those things work together. Now we're adding AT&T integration to the network that we hadn't planned on doing, in addition to the integration of T-Mobile. We think that's going to be at least a 90-day kind of beta integration. Things work in the lab today. When you take them out of the lab and we get them on Dave's network that'll be deployed by the end of September, we can light up Vegas in total. That goes from the lab to reality. My experience is things don't work exactly right the first month or two, and you've got to integrate that. We'll go from there. We will have retail, obviously in Vegas, as in other cities, it'll light up very quickly after Las Vegas. We'll have a retail presence, and we'll have offers for consumers that we think will be competitive. Got it. Thanks, Charlie. We'll now take the next question from Jonathan Chaplin at New Street Research. Please go ahead. Hey, guys. It's actually Phil Burnett for Jonathan Chaplin. Quick one. Will the in-market roaming element of the AT&T deal lead to a more efficient and quicker network build for you guys? I understand that it won't change the FCC requirements, but does it change the way you think about the build? Thank you. Yeah. I'll start, and then I'll let Dave wrap it up. The in-market roaming is important in terms of the customer experience and the ability to manage our customers. It really doesn't impact the bill plan that Dave and his team are working on. I'll let Dave add to that. Yeah. We're not doing anything differently as a consequence of the AT&T deal with respect to meeting our FCC milestones. Got it. Thanks, guys. We'll now take the next question from Phil Cusick at JP Morgan. Please go ahead. Hi, guys. Thanks. Charlie, you alluded to this with the AT&T comments, but any updated thoughts on a DBS merger now that DIRECTV's separated? Does that separation change anything, and what's lost as time passes? Just quickly as well, what's the exposure on the CDMA shutdown still? Thank you. Yeah. In terms of DIRECTV and DISH, obviously I've said it the last year, I think that those two companies go together, that's inevitable. Really, there's another party involved in terms of TPG, whether that's positive or negative, I don't know. From a regulatory point of view, obviously, this is less and less reality to objections to it because obviously the hundreds of billions of dollars for broadband deployment and continued competition from the programmers themselves in the marketplace. I think we'll just have to wait and see whether there's desire on everybody's part to do that. I think it's a timing issue more than anything else. In terms of, I think the other question was CDMA shut off? Look, I said early this year that that's kind of a false. T-Mobile had under oath talked to regulators in California that they would be a minimum of three years. I think it's a false, artificial deadline to turn it off in January this year. We view that as a very anti-competitive move because that's a situation where the people that we roam, that we pay, that are our partners from an MVNO are actually obviously outwardly challenging to get our customers, and that was a convenient way to do it. You may notice that they've got, and I think they're kind of smoked out now, right? They have extraordinary offer in the marketplace for a free upgrade to a 5G phone and 50% off for service for two years. Extraordinary offer. That's obviously aimed at customers to upgrade to their network. I think the bottom line is that they're really what I call sore winners. It's hard to be a good winner sometimes. They get $70 million of synergy. $70 billion of synergy the government allowed them to have. Now they want $71 billion by getting some customers that we already paid them for. You've all met that guy in grade school who won and bragged about himself and bragged about how good he was and spiked the ball in front of you. Sometimes it takes a bit of maturity to be a good winner. They're a sore winner. It's good. On the other hand, the fact that a consumer could upgrade, that may not be good for Boost. At least our main objective at DISH and Boost is to make sure customers don't lose their service. To the extent that the customer upgrades and doesn't lose their service, I'd much rather have that than the customer lose their service. We expect that they'll continue that promotion through January 1st. I think that they've been in the business. They went on TV, their CEO went on TV and said that nobody would be impacted, that everybody was going to be upgraded by January 1st. I expect that they're going to continue that promotion. They're going to upgrade everybody by January 1st. If they do that, there's probably no controversy other than competition. We'll have to wait and see how things go. How many customers do you still have who would be exposed to that CDMA shutdown, Charlie? Well, I think our last disclosure was the majority of our customers. Was that a quarter ago? Majority of our customers that we are taking all reasonable efforts to migrate customers, and we've made good progress on that so that people don't suffer from a premature shutdown. I think the number is now smaller. I would say this, that our projections show a material amount of customers on January 1st will still have CDMA phones and will lose their service. Again, this is the most economically challenged group in America. Boost, these aren't the customers that have bank accounts and high-paying jobs. These are people that are challenged, and so economically challenged. I think it's even more important that these people don't lose their service. Thanks, Charlie. We'll now take the next question from Doug Mitchelson at Credit Suisse. Please go ahead. Thanks so much. A couple of short ones and then one for Charlie. In terms of the NSA and AT&T requesting to use portions of the DISH spectrum, would AT&T be able to use that DISH spectrum to serve their own customers in addition to serving DISH customers? The reason I ask is the language in the 10-Q wasn't quite clear, since it noted AT&T would be able to deploy the spectrum to support DISH customers. That's the first quick one. I'm going to let Stephen answer that. Doug, basically, AT&T can deploy that spectrum for not just our customers, but for all customers on their network. Part of the reason we looked at that was as we load up capacity on their network, is just making sure that our customer experience and their customer experiences continue to be market leading. Okay. That's clear. Given the Las Vegas wireless network coverage you are building, what would you anticipate would be customer usage in the Las Vegas area on the DISH Network versus needing to roam on AT&T or T-Mobile? Yeah. The majority of the usage will be on our network, but complemented by the coverage and the network that we have access to with AT&T. Okay. Thanks. Charlie, I was just hoping to gauge you on longer-term capital needs. Maybe this won't go anywhere. You've talked in the past about achieving O-RAN and now, I guess, cloud core proof of concept as a driver of cheaper access to capital for DISH. At this point, are you contemplating a wireless strategy that's aggressive enough that you think you will need outside capital? I know you've talked about self-funding most or all of this sort of phase one initial build. I imagine you've got multiple scenarios where you could be a lot more aggressive with spectrum and customer acquisition and pace of build and other things to go after wireless either quickly or you could go after wireless at a pace that you could afford with just internal capital. Any thoughts on accessing capital in the future post Las Vegas? Well, I think historically, we've accessed the capital markets, so our four year history, and obviously we have obligations we need to pay back. As always, we're opportunistic in the capital markets if there's reasonable ways to raise capital, and we plan our business accordingly. We've been pretty innovative, and obviously, we've never had the kind of capital that some of our competitors do, and so we've had to be more innovative, and I think that we're comfortable in that space. We have the capital. I think Dave Mayo sleeps at night knowing that he has the capital available to meet his deployment guidelines for now. Obviously, Erik Carlson has run the business in a positive cash flow manner. If there's opportunity out there with partners or with the markets themselves, we obviously look to take advantage of those things. All right. Maybe I could try it this way, Charlie. Is there sort of line of sight on this network will take four to five years to build, and it'll be in a pretty good place. It's going to take 10 years, 15 years. Is there sort of a sense of time to get this business up and get it running the way that you like? Well, I think we're less than two years away from what I would call critical mass. We're going to cover 70% of the country for the next two years of population, that's critical mass. That's enough critical mass. That's on par with where Sprint was, I think they had 50 or 60 million customers. We're going to have a better network than they had, we're going to have a differentiated network, better roaming than Sprint had. This isn't a five-year project. Obviously, our first milestone of 20%, I think you'll have a pretty good feel, we'll be able to start helping you develop models of where this goes. Clearly, the 70% milestone will be enough to compete at a very high level in the marketplace, both for consumers, maybe in our case, more importantly, for enterprise business. All right. Thank you. I'm looking forward to that Las Vegas pricing. That'll certainly help with the model. Thank you. We'll now take the next question from Brett Feldman. Please go ahead. Thanks. It's actually a follow-up to exactly what you were talking about. For a while, you have flagged the enterprise space as a key opportunity for the advanced capabilities of the network you're building. You've talked about network slicing and AV private networks. Typically, in the enterprise market, particularly when you're deploying infrastructure in response to a customer win, it's not uncommon for those enterprise customers to help fund the deployment of that infrastructure through large upfront payments. Are you contemplating that that is a part of how you're going to fund the business going forward? Meaning, as you think about that $10 billion budget you outlined, is it plausible that some of that could be financed by enterprise customers? The flip side of the question would be, if that's not the case, how are you thinking about pricing your services in the enterprise space, particularly when you're deploying network in response to contract wins? Thank you. I'm going to throw that to Stephen other than say that I think there's a lot of models in enterprise business. You can imagine enterprise customers who want a slice of the network and they want a certain level of quality, and they want it to happen in the geographic region that we haven't built out, they want built out. Your scenario is certainly plausible. You can imagine just straight business deals where people pay by the drink or pay by the gig. I think the broader answer is, I'll let Stephen answer, is really why the architecture that we're building is so enticing for enterprise customers and why it differentiates maybe from what they can get with the incumbents. Yeah. Adding to Charlie's comments, we're seeing significant traction and interest today in private networks and private 5G networks. The architecture that we're deploying really enables a level of control and a much deeper level of security that allows the enterprise to utilize that network for their own business operations. We're seeing significant interest there. We've been responding to multiple RFPs, RFIs. We're working on proof of concepts right now. We're partnering with a number of different SIs as we bring the services to market. There are different business models depending on the customer, depending on the geography. The good thing about these private networks that we're working on is they're not constrained by the geography of building a macro network. We're able to serve customers in different geographies within that environment. The other thing which is also important to highlight, it's across all verticals. There isn't a specific vertical that has an interest in this. We're seeing interest across every vertical and every industrial segment. We're very well positioned to take the architecture that we're deploying, being cloud native, but also the open architecture, the ability to do slicing. It is distinctively unique compared to what the other operators have in the market today. It's not to say that they can't get there in the future, we clearly have an advantage today that we're taking advantage of. I think it's also important to add that even in the DISH business today, we do a great business in serving hospitality and so we're able to partner with the systems integrators we have within that business to augment what we're doing on the video side. That's really a terrific model where we can integrate kind of the capabilities and the assets that we have across the whole company, to serve other verticals as well that some people may not have on their radar screen today. Thank you. We'll now take the next question from Craig Moffett. Please go ahead. Yeah. Hi. Thank you. Let's stay with the same topic if we could, Charlie. The enterprise market today is mostly national sales, for devices that really aren't dissimilar from the consumer market. What you're describing is quite different. Can you talk about some of the particular opportunities, if not by verticals, then by applications, that you see in the enterprise market that you can uniquely serve and how large you think they are as businesses? Which ones in particular you envision being regional rather than national sales? I think a lot depends, I guess, on whether companies are interested in buying services that are really on a much more localized or regional basis wirelessly than they are today. Yeah. Stephen may jump in here, but there clearly are national enterprise areas where we wouldn't be competitive today. Even within national companies, there's very much of it that's localized. You can imagine that on the hospitality industry where your hospitality is still localized, but in the hospitality industry, you're going to differentiate yourself from your customer service because that's the hospitality industry, and you're going to do that in a market-by-market basis. You could imagine things like mining that need private networks, and they probably have to get built because they're probably not in anybody's footprint today on the other extreme. There's just a lot of different areas there. I would contend, Craig, that the profitability on a per bit, on a per dollar of CapEx, and a per gig basis is going to be much higher, in the enterprise business than it would the consumer business. The consumer business is quite competitive, and with three big players and us entering the marketplace. It's quite competitive. Enterprise business, each company is going to have different needs, and in some cases, we won't be able to fulfill those needs. One of the other three carriers will be able to do it. In many cases, we're the only guys that can really, in the foreseeable future, fit their needs. That's going to be a good business for us. Those are long-term contracts. They are a long-term sales process. From a revenue perspective, you're not looking for that to be a big revenue item next year. Peripherally, we just know by the interest that there's never a conversation with a company at high levels where they don't want what we're building, I guess, is the way I'd say it. We may not be the right company for them. It may be one of our competitors that is better suited, but they want where things are going. You just can't get there with legacy networks because you'd have to automate. To automate, you have to be in the cloud, and we're going to be there. O-RAN, nobody wants to build last century's network. They want to build the 21st century network, and that's what we're building. That's where people are going to spend their money from an enterprise perspective, are going to want to go. And- The access is in there. Sorry. I was going to say, if I could ask a quick follow-up. Do you envision bringing those same capabilities to wholesale markets and for being a network provider for other MVNOs? Are there any limitations under the AT&T agreement in your doing that? There's no limitation in the AT&T agreement. You could imagine that if another network provider, let's take AT&T since obviously we have a long-term relationship now, and they wanted to wholesale from our network because they had an enterprise customer, and we had maybe some architecture that helped them get there, that's an interesting conversation to have, because we both would win. Again, I've said it for two years now, we're interested in working with those companies. We define a partner, working with companies who want to help our company get better, and in return, they should expect that we're going to help their company get better. That's not always the way business works, right? Some companies, it's a zero-sum game, where I win and only if I win and you lose, am I willing to do a deal. I understand that. I thought 30 years ago, that probably sounded like me. I'm kinder and gentler now, as people around me know. At least I'm more experienced and more mature, let's put it that way. I just think that particularly in capital-intensive industries, I think that where people decide that they could take the approach where a more partnership approach is, I think that's a potentially competitive advantage. I'm sorry we're so conceptual, Craig, at this point, all those concepts turn it into real business models that ultimately you can see the cash flow generation in the future. My job strategically is to make sure that the concepts can then turn into that. That's really helpful. Thanks, Charlie. We'll now take the next question from Ric Prentiss, Raymond James. Please go ahead. Thanks. A couple of follow-up questions. Obviously, a lot of discussion on the MVNO agreement. To provide the best network to your customers, could it make sense to do other network sharing agreements with people that have better networks in rural America than maybe AT&T and T-Mobile have, i.e., maybe a US Cellular relationship? Would that make sense maybe? The answer is yes. Okay. Would we be prevented from doing something with US Cellular per the AT&T agreement? No. We're not prevented, in fact, we've talked to a number of regional and rural operators about how do we do things, to Charlie's point earlier, about partnership. How do you do it in a capital efficient way that both parties benefit? We've had a number of those conversations. Yeah. That certainly makes sense. You can imagine that part of our rural strategy would be work with those people that are already in rural America. AT&T, as much as geography as they cover, which is a lot, there are still rural carriers and including US Cellular, that cover areas that AT&T does not, or T-Mobile does not. Makes sense. Second question. You mentioned on Vegas, Dave's busy at work there. The consumer data trial, how should we think about why not a wholesale enterprise data trial? Is that something that would also be occurring in the fall, winter timeframe? We're in active discussions on enterprise and wholesale. Not all wholesale is national, and a lot of business services are local. We are actively pursuing a number of opportunities, not necessarily just in Las Vegas either, for that matter. I would say the bar is a little bit higher in the enterprise business in terms of quality, and we're going to walk before we run. I wouldn't expect that enterprise happens in, just so you know, enterprise is a 2022 kind of thing because we got to get Vegas right first. That makes sense. I would show enterprise what you're doing in Vegas so they can really see what the network topography looks like. We'll definitely do that, as will everybody in this call. We'll probably be at Consumer Electronics Show. You'll get a phone and I know you'll do two things. You'll measure speed, and you'll see if you drop any calls. Exactly. Right? You'll check coverage, and you'll check your speed. Right? Last one from me is you guys have done a bunch of tuck-in acquisitions. Are there other opportunities out there to add scale into your business? Related, Shenandoah's wireless sale to T-Mobile closed. Do those Boost customers come onto the plate for you guys if you want them? We always look for any kind of acquisition that makes our company better, or any sale that we can sell that is more beneficial to somebody else than us. We always look at that. Shenandoah you want to take that one, Tom? Because you know more about that than I do. Yeah. The Shenandoah customers were purchased by T-Mobile. Okay. Very good. Thanks, guys. We own the brand, right? Yeah, they're operating under a reverse TSA, similar to the transition services agreement that we operate with T-Mobile on. We're supporting the Boost customers on behalf of T-Mobile in that region. We certainly expect maybe a sale of that to you guys. Nothing to report there. Okay. Thanks, guys. Stay well. We'll now take the next question from Walt Piecyk at LightShed. Please go ahead. Thanks. Hey, Charlie. Your 10K has a letter that the DOJ sent you guys in early July. I'm just curious if there's been any follow-up dialogue with the DOJ, the FCC, and similarly with Verizon, who I think also may have interest in setting up an MVNO with you guys? Again, the conversations that we have with regulators, absent needing to publicly disclose like we did because it's material to our business, are going to stay confidential. I think we take regulators and regulation seriously, right? You can read the letter from the DOJ and obviously, we're going to continue to take all reasonable steps to mitigate the expected harm from the CDMA shutdown. We're not able to do everything, and we do think it's an issue, and obviously, the regulators are paying attention to it. I think that's probably what they should be doing, and I think we all knew when we did the T-Mobile/Sprint, we all knew the conditions that were going to be part of that agreement, and we just all had to live up to them. I forget, the other part of your question was? The other part was basically Verizon. Verizon. By the way, T-Mobile on their call claimed that you're only paying them or less than $2 billion. Whether it's Verizon or AT&T, just kind of, A, are you talking to Verizon? B, how much of the $2 billion do you think remains after two years? Well, I won't get into those details, Walt. Look, we're large MVNO, and if Verizon is successful in TracFone, with the acquisition of TracFone, we're the largest guys out there. It's disappointing. This is personal, but we've been T-Mobile's largest customer for the last year, not named T-Mobile, right? I don't know that we've been treated like the largest customer, let's put it that way. Rich is chomping at the bit to ask about Sinclair. Let me just get one more Spectrum one in. Any agreement you have with AT&T, is this going to be in the form of a lease or are you just going to basically give them the spectrum to make their network work better? I think that band 66 stuff they've, or Verizon at least has shown in the past, can be flipped on within a matter of days. How do we conceptualize AT&T using that spectrum? Is it a lease agreement? Is it for free, and how does that work? Well, first of all, I think they'd only be interested in spectrum that they could utilize pretty quickly. In other words, they have the equipment ready to do it. 67, yeah. Like any partnership, that would have to be mutually beneficial to the companies. So far, the relationship with AT&T, we've been able to work through those issues. Got it. All right. Rich, you want to hop on? Yeah. Thanks, Walt. Charlie Tom, I guess when you dropped Sinclair's RSNs, you basically said that just sort of given how long they've been gone, it sort of felt permanent. From what the press release, Sinclair just put out a press release saying that they expect their TV stations to get dropped due to a retrans impasse in a week. I guess it feels like they're trying to tie RSN carriage to retransmission consent, which I don't think is allowed. I'd be curious, like, don't they have to treat these separately? I mean, it seems sort of crazy for your customers who don't even have the RSNs. This isn't an RSN renewal. It seems like to be forced as part of a retrans renewal to take on channels that cost an extra $4-$6 a month seems pretty crazy for DISH without a lot of upside. Could you just give us some sense of whether this is being tied, whether it can be tied, and what your recourse is? Well, that's a lovely question. First of all, I'm disappointed that they put a press release out that they expected the networks to come down since, I think after August 16th. Obviously, many negotiations come down to the wire. We're still going to bargain in good faith and hope that, disappointed that they seem to come to conclusion that channels are coming down, at this point. The good news for our customers are they have other ways to get their channels. First of all, they watch them less, the networks less, and they have other ways to get those networks, that they haven't had all those ways in the past. We're empathetic to Sinclair because they are having to compete against their own content providers, and we've had a long-term relationship with Sinclair, and it's been good. We've been able to work through issues at least as tough as this one over the years. The regional sports question that realized that Sinclair didn't own the regional sports networks when those networks came up for renewal, by the time Sinclair owned it and was able to negotiate on their part, our customers that wanted regional sports had left. There was no way that in fairness to our customers, we could tax them in a basic package and tax customers who almost nobody that was left that wanted regional sports was left on our network. They'd gone somewhere else to get them. I think there's innovative ways to reinvigorate the regional sports networks. Sinclair themselves have talked about it in a direct-to-consumer product. I think there's other ways to do that. We'll continue to work with Sinclair to the extent that they want to try to work with us in a win-win situation. If not, I'm not going to speak to all the legalities and regulations. Sinclair is pretty savvy about those things, and so they'll work their way through that. My expectation and hope would be that ultimately, the companies find a way to resolve all the issues of concern to both parties. If not, and we go our separate ways, we'll work to mitigate that for our customers. Just to be clear, Charlie, when you say work to mitigate those issues or get to a mutually satisfactory, you're talking about a deal for the TV stations not to carry RSNs. Is that just to be clear? We don't have any customers calling us on RSNs today. To the extent the local channels were to go down, we would have more than 1 customer call us the next day and say, "Where's my local channel in this particular market?" Our focus is on making sure that our customers aren't disenfranchised for the local channels. If there's some opportunity on regional sports that make sense for us and Sinclair, we're happy to talk about anything that's creative and doesn't harm our customers. We're not interested in taxing our customers when they don't watch the channel. That doesn't make any sense. Our customers will understand that, and if we would lose some customers if the networks go down, and some customers just quit watching the networks. You may want to jump in on this, Erik, but we've been through this before. The impact of local channels used to be devastating. It's still pretty bad, but not the same. There's other alternatives. Rich, as you know, this is Erik, as you know, obviously viewership on broadcast is declining. We just ended the Olympics. I think you've done decent reporting on viewership on Olympics. I think Charlie's point on us being sympathetic to some of these folks is true. They're also in competition with their big owners. I think NBC announced that they're moving Notre Dame football game to Peacock, the home opener, right? Whether it's award shows or whether it's sports or whether it's big tuner events like the Olympics, you're seeing viewership decline. The local broadcast networks do become less important for our customers. As you know, Rich, there's other ways to get the networks, right? We've obviously helped our customers with either off-air antennas or new technologies like Locast or technologies like CBS All Access, which is now Paramount+ or Peacock, right? It kind of depends on the customer's viewership habits, and some of those are changing. And, you know- Thanks very much. customers figure it out. If they get disenfranchised, they'll leave the networks. That's why Netflix has viewership and Prime has viewership, and Disney has viewership because they get taken down and customers get frustrated. As things get online, they know how to steal it. The piracy is a huge problem with online. There's not a network you can't get online if you're savvy. Young people already know how to get it if they want to watch it. It's not always the most rational thing to take a network down, going down is not good for anybody. Okay. Let's put it that way. We'll see what happens. We'll now take the next question from Kannan Venkateshwar at Barclays. Please go ahead. Thank you. Charlie, on the wireless front, one part of it is the network build-out deadlines, which obviously are cast in stone in some ways, but the rest of it is the organization build-out, with respect to scaling the service. Telecom organizations are obviously significantly bigger than where you are in terms of number of people and so on. Could you help us think through how the scaling of the rest of the wireless organization is going, and if you basically plan to pivot some of the resources away from the DBS business to the wireless business, and how long does it take to scale that whole thing up in terms of people? Secondly on the SAT front, would be great if you could give us some kind of an update on the thought process there. It's been a while since we heard from you on that. Thanks. Okay. Yeah. Won't take a SAT question on here. Netflix had a fraction of Blockbuster employees. How'd that work out? We had a good base of engineering already at DISH, and obviously we have a lot of talented individuals, some of which are on this call, some of which are not on this call. We built a set of executives who are working on where things are going, not where it's been in the past. I think there's plenty of resources out there, and for what we need to do in wireless. I think we can walk and chew gum at the same time. Erik is able to run DISH and Sling in a highly efficient manner, as well as work on our retail wireless. I don't see a conflict there. Don't get me wrong, it's always hard to find good people. It's probably a little tougher in this environment today with unemployment being low. When you're building the future, people with ambition and people who are curious, that's where they want to go. This is a great place to come work and help us do something, and we're finding a good flow of people. Operator, we have time for one more analyst call before we take a few press calls. Thank you. We'll now take the next question from Michael Rollins at Citi. Please go ahead. Thanks, good afternoon. Just two questions, if I could. First, curious how you see the opportunities to leverage your 5G network for fixed wireless broadband services over time, and how you view the potential funding for broadband in the proposed infrastructure bill as an opportunity in which DISH may want to participate. Just separately, a question on Sling. It returned to positive growth in the quarter. What are your learnings on the customer interest to migrate from legacy video platforms to live streaming platforms? Just curious for your latest views on the opportunities to move a larger portion of your historic DISH video base to your streaming Sling service. I'll let Erik take the Sling question. I think fixed wireless is a place where the wireless industry can go. Verizon and T-Mobile have already gone there, maybe AT&T some as well. Certainly T-Mobile and Verizon have gone there. I think as they light up more of their spectrum, there's certainly places that we can go there. Obviously, I do think you bring up a good point. I think that all of us in the connectivity business are going to have to look and see what the subsidy of the government infrastructure, where the government wants to go, and whether your particular company strategically fit into that and whether that's good business for you. Obviously, we'll look at that. I think the amount of infrastructure that the government is talking about is probably a positive for all connectivity companies and certainly, potentially for Americans that don't have service today. With that, I'll give it to you and Sling. Yeah, Michael, maybe just a few points on your questions there. One is, in the traditional DISH TV satellite business, as you know, for some time, we've really been pointing our efforts towards both acquiring and retaining those profitable customers that are in a more rural geography. That strategy's been working well for us. As the opportunity presents itself, as broadband continues to densify, obviously Sling can be an opportunity for those customers that want to cut the cord there and maybe have a couple of spot services along with a service like Sling, which can be very complementary to, obviously a Netflix or a Peacock, et cetera. On the Sling side, there's a couple of things we've been talking about over the past few quarters. One is, there is a touch of seasonality, obviously, to the OTT business. It is a low barrier of entry, and it's easy to cancel. With that said, we also put the onus on ourselves to create a better customer experience. In Q2, you've seen us deploy now some new technology and a new app to most of the Amazon base and about half the Roku base now. You're seeing us provide a better customer experience. We're seeing, obviously, better in the key metrics that you would follow associated with customer engagement. We're seeing those all improve, and so we're optimistic, heading into football, about our ability to deliver a better customer experience. Obviously, you had a couple of tune-in events like either Euro 2020 or NBA, which obviously helps some of the Sling numbers in Q2. All right, operator, now we'll take questions from the press. Not sure how many are in queue. Thank you. We'll now take questions from the media. Again, if you are a member of the media and you would like to ask a question, please press star one now to enter the queue to ask a question. Our first question from the media will be from Scott Moritz at Bloomberg. Please go ahead. Great. Thanks. Charlie, on the 5G launch in Vegas, just trying to get an understanding of how that is going to work. You're calling it a 90-day beta, I believe. Who's coming onto it? Is it going to be Boost customers? Are these new customers? If it's a new customer, is this a new consumer plan? The beta test will be, we have something called Project Genesis, where people are signing up today to be online to be beta customers. It will come from, it may be some of our employees, but it will be random. It's basically set for people to give us feedback. The network's not going to work perfectly, we're looking for people that give us feedback on how to improve, we'll find areas. We have to tune the network, for example. We need to know location and service, we'll just have people that are the regular customers that are using it that are willing to give us feedback. That's how we'll start. We've been through that when we've rolled out high-definition television or DVRs or any kind of new service. That's the approach that we've taken, and it works quite well. It allows us to move pretty quickly to improve our network because it's not going to be perfect the first day. It's a 90-day beta launching in September, I believe you said. After that 90 days, it becomes a full-fledged product, which is probably, what, early next year? I think the way I'd say it is, our normal expectation would be that, yes, we turn into a full-fledged product early next year, right, and it's commercialized. We'll have to see how our beta goes, right? I'm in a beta test now for a service of a different sort that I think I'm about nine months into beta. We don't think that that's where we are, but we have to get more data on the beta to know when we roll out. We get a first impression, and we want it to be a good first impression. Obviously, we do. As soon as we Everything we learn in Vegas rolls directly into the other networks, so we can light up at the same time. The bottom line is that it's going to be a minimum of 90 days, and if we do our jobs correctly and our vendors do our jobs correctly, then we're going to be ready for prime time at the first of the year. Great. Thanks. We'll now take the next question from Mike Farrell at Multichannel News. Please go ahead. Hi, guys. Just a couple quick things about Sinclair. Just wondering if there's any way you can comment on what you might think is the sticking point in this whole thing. Is it beyond just they're asking for too much money regarding fees? There had been a lot of talk before, because you haven't had their RSN for three or four years, that you were at a competitive advantage here and that maybe you guys would've been looking to tier those channels, and maybe they're pushing back on that. You probably won't be able to talk too much directly about that for this contract, but is tiering something that you're looking at when you do RSN negotiations going forward? Yeah. At the end of the day, it's about money. It's about economics. Yeah. That hasn't changed. That hasn't changed in any programming negotiation that I've ever been involved in. Right? One thing that we do differently is we have viewer metrics, and we know what the cost to the viewer is and we have knowledge in how the customer values a channel. If you get real-time viewing data as we have for the last seven or eight years, you can be pretty precise on what a channel is worth. That's the metric we use. If you're on the other side of it, most programmers just have a budget, and they have a number they gave Wall Street or whatever it is, and they just say, "Here's the number we want." Sometimes those are pretty far apart. Obviously the specific commercial terms of any negotiation aren't something we're going to talk about publicly. Operator, we have time for one more from the media. Thank you. We'll take our final media question from John Celentano at Inside Towers. Please go ahead. Thanks for taking my call. This is the first time I've been on your call. Inside Towers, if you're familiar, is a daily newsletter that covers the wireless infrastructure business. Up to now, we really haven't covered DISH, but once you decided to build your own network, then we took an interest. Let me ask a broad question that doesn't necessarily apply to DISH, but I think has implications across the industry. For all the planning and studying that you've done in building the network, do you think it's feasible that a carrier does not have to own its own infrastructure aside from, say, spectrum and software? TracFone proved you didn't have to own anything. Right? Very successful business. They bought for billions of dollars or had billions of dollars market cap. They were very successful with no infrastructure. When you start looking at I think the world will change. I think the kind of architecture we're using, the fact that technologies in terms of cloud and O-RAN and virtualization are going to change things. We're open-minded about it. I think we're open-minded about the fact that things could change maybe in a way that we can't predict today or maybe in a way that's not even beneficial to us. Our bet and our gut and everything we know that it's changing. We're helping change it, and when you help change it, when you are part of the future, then you usually win. It's the people who fight the future that usually have the problem. We're embracing the future, and we think that gives us competitive advantage. Great. Thanks very much. All right. Thank you, operator. Thanks, everyone. Talk to you again next quarter. That concludes today's call. Thank you for your participation. You may now disconnect.