Dish Network values its offer at $7 a share, including $4.76 in cash and the remainder in its shares. The offer is 12.5 percent above Sprint Nextel’s closing share price on Friday.
“The Dish proposal clearly presents Sprint shareholders with a superior alternative to the pending SoftBank proposal,” Mr. Ergen said in a statement.
Mr. Ergen said a “Dish/Sprint merger will create the only company that can offer customers a convenient, fully integrated, nationwide bundle of in- and out-of-home video, broadband and voice services.”
Dish Network said it would be able to combine its existing broadband and TV offerings with Sprint Nextel’s cellphone operations, allowing it to better compete with rivals like Verizon that are moving into new areas in search of revenue.
Dish Network’s effort to take over Sprint is the latest of many moves toward consolidation in the highly competitive broadband industry. In 2011, AT&T tried to buy its rival T-Mobile USA, a move that was blocked by the Justice Department because of antitrust concerns. Last year, Verizon scored a deal with a group of cable companies that agreed to sell it spectrum licenses to build its wireless network in exchange for allowing them to sell their cable services inside Verizon stores.
“Sprint doesn’t change overnight because of SoftBank — it’s still Sprint,” he said. “Sprint transforms overnight with Dish.”
Susan P. Crawford, a law professor at Cardozo School of Law who served as special assistant to President Obama for science, technology and innovation policy, said there were pros and cons to a merger with Dish Networks. A combination with Dish Networks would pose more of a threat to AT&T and Verizon, which account for two-thirds of American wireless subscribers, than a partnership with SoftBank, she said.
But it would also weaken T-Mobile USA, the No. 4 carrier, which has been offering cheaper phone plans to consumers, like its latest contract-free phone plans.
“Right now, we have two giants and two also-rans, and now you’re getting potentially three giants dividing up the American marketplace, with T-Mobile lagging far behind,” she said of the potential Dish-Sprint merger.
It is unclear whether a Dish takeover would change much about Sprint’s wireless service. Chetan Sharma, an independent telecom analyst who is a consultant for carriers, said that the only obvious change for consumers would be at a marketing level, not a technology level. While the bills may be consolidated, it would not be easy to share the benefits of a high-speed Internet connection at home with wireless networks that connect to a phone outside, he said.