(Bloomberg) -- Charlie Ergen, the billionaire who runs Dish Network Corp., stepped down as chief executive officer to focus on untapping billions of dollars of the company’s unused wireless spectrum.
Investors have been pushing for a big-ticket deal to capitalize on the spectrum, which is ideal for streaming movies as well as maintaining a cellular signal over long distances. Ergen, who will remain chairman, spoke last month of new opportunities for wireless partnerships in the wake of the collapse of merger talks between Sprint Corp. and T-Mobile US Inc.
The company’s future could ride on the spectrum since Dish’s satellite TV service has lost subscribers for at least the past three years to cheaper online services like Netflix, Hulu and Amazon. As part of Ergen’s move, Dish will adopt a group structure that it said will more effectively support DISH TV as well as the company’s own streaming offering, Sling TV.
“We really don’t think this suggests any strategic change in the business, but rather highlights Charlie’s commitment to the 5G-like/capable network,” Marci Ryvicker, an analyst at Wells Fargo Securities, wrote in a note. “We view today’s announcement as more housekeeping than anything else.”
Dish shares were little changed at $51.94 as of 11:25 a.m. in New York. The stock has declined about 11 percent this year.
Ergen will probably have to start building a network to put Dish’s airwaves to use next year if he doesn’t have a deal. Dish has to comply with Federal Communications Commission requirements that a network using the spectrum be deployed by 2020, Josh Yatskowitz, an analyst at Bloomberg Intelligence, said last month.
As chairman, the 64-year-old executive will continue to control the company he co-founded. Chief Operating Officer Erik Carlson, who has been with Dish since 1995, was promoted to CEO and will continue to report to Ergen, according to a statement Tuesday.
This isn’t the first time that the unpredictable Ergen has stepped down as CEO. In 2011, he gave up running the day-to-day operations to focus on integrating a number of businesses that he had acquired. He retook the CEO title in 2015.
The new changes come at what might be a pivotal moment for Englewood, Colorado-based Dish as Ergen seeks a commercial application for the idle trove of airwave licenses.
“Last time there was a round of reshuffling, it gave Chairman Ergen the opportunity to pursue the strategic direction of the company,” said Amy Yong, an analyst with Macquarie. “My guess is this signals the same.”
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