Hello! And welcome to our Friday column, Worst of the Week. There’s a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!
And without further ado:
Having attempted to steer clear of the Softbank/Sprint Nextel/Dish/Clearwire soap opera for at least a week, I find myself back in the stands at this ongoing circus trying to again piece together what the hell is exactly happening here. And, to be honest, I can’t get enough of it.
I think by now we all know the back story of this play in which attempts by Softbank to acquire Sprint Nextel and Sprint Nextel to acquire Clearwire keep getting interrupted by that pesky Dish Network, which seems to have a knack of throwing a wrench in well-laid plans at the very, very, very last minute.
That timing played out again this week as Dish, seemingly having forgotten that it put in a bid for Clearwire in early January, decided to increase that offer just a day ahead of Clearwire shareholders putting in their votes regarding the recently bolstered Sprint Nextel offer. This offer followed repeated reminders by Clearwire’s management to shareholders to make sure to vote in favor of the Sprint Nextel deal, both before and after that offer was raised.
This latest offer, of course, forced Clearwire to postpone that shareholder vote on the Sprint Nextel deal as it now has to consider the vastly financially superior Dish offer. Now, I am sure that Dish has an earnest interest in acquiring some sort of stake in Clearwire and that this latest plea is not just some sort of ploy to screw with Sprint Nextel, Clearwire and/or Softbank, but did they really have to wait until literally the last minute to put this offer in?
It’s not like Dish did not have a direct line to Clearwire Chairman John Stanton, which if you read through Clearwire’s notes had repeatedly asked Dish to put in a bid for the company following Sprint Nextel’s original offer late last year. Those requests finally resulted in a Dish offer, which of course came in after Sprint Nextel had already put in its bid.
Suspiciously, Dish’s latest offer came just a day after Softbank and Sprint Nextel gained government security approval for their proposed deal, something that Dish had hung its hat on as a reason that Softbank should not be allowed to move forward with the Sprint Nextel transaction. And by “hung its hat on” I mean made comments that were hilarious.
Look, I have to believe that Dish Chairman Charlie Ergen is a smart man and is not making these decisions in the manner that they would appear. This last bid for Clearwire would seem to be an attempt to force Sprint Nextel to raise its offer as it is already too far down the path on this deal, or at least force the hand of all involved so Dish can really get a piece of both Sprint Nextel and Clearwire.
Or, maybe Ergen has really had his eye on another operator, be it T-Mobile US or Leap, all along and by making these moves on both Sprint Nextel and Clearwire is ensuring that however those deals end up, the companies involved will be forced to pay top dollar and thus weakening their competitive position going forward.
This sort of behavior does have some precedent in the mobile space. Was it not Verizon Wireless’ minority shareholder Vodafone that was in the running up until the final hours to purchase AT&T Wireless Services back in 2004, only to have Verizon Wireless rival Cingular Wireless finally win out in that contest for some $41 billion.
Analysts seem to think that this latest offer is an attempt by Dish to throttle Softbank’s interest in Sprint Nextel, noting that all that Softbank really wants from Sprint Nextel is to get its hands on some of that Clearwire spectrum.
At this point I no longer know what the hell to think other than that I hope this circus never ends. (Now that’s a phrase I never thought I would type.)
OK, enough of that.
Thanks for checking out this week’s Worst of the Week column. And now for some extras:
–Huzzahs to Motorola for doing what others should have already done (cough … Apple … cough) in stating it plans to build its yet-to-be-released “X” smartphone here in the good ‘ole U.S. of A. (Or, at least in Fort Worth, Texas. Close enough.)
I may have mentioned at one time or another that this sort of flag waving was prime territory for Apple, which has been hammered by bad press over its manufacturing relationship with notorious China-based consortiums. At that time I noted that perhaps Apple could temper some of that ill-will by moving a portion of its iPhone/iPad/iWhatever manufacturing to someplace in the United States.
But, alas, that has yet to happen, and know we have Motorola, which is owned by Apple arch-rival Google, moving forward with said flag waving. Well done Motorola, and hopefully this move can provide some motivation for others to diversify their manufacturing bases.
Not that I have any favorites in the mobile device space as I am ambivalent to them all equally, but this move by Motorola lessens that ambivalence just a touch. Thanks Motorola, now you are making me think I have feelings.
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