CONX Acquires MobileX and Starlink MVNO Ambitions

Full Transcript

Don Kellogg 0m10s

Hello, and welcome to the three hundred and eleventh episode of the week with Roger, conversation between analysts about all things telecom, media, and technology by Recon Analytics. I'm Don Kellogg, and with me as always is Roger Entner. Roger, how are doing?

Roger Entner 0m23s

I'm good. How are you?

Don Kellogg 0m24s

I'm good. So we've got some MVNO news today, couple items actually. So the first of which is that Mobile X and its founder, friend of the podcast, Peter Aderton, have been acquired. Do you wanna tell us about it?

Roger Entner 0m38s

Yeah. So first broken by the Wall Street Journal, Peter and Charlie Ergen got together through the Connex part of the company, not the DISH EcoStar part of the company, which is kinda important. On one hand, it's owned by the same guy. On the other hand, it's two legal entities. Apparently, $200,000,000, Connex will own 60%, Peter owns 20%, apparently Verizon owns 12 and a half percent.

Roger Entner 1m9s

And this is all based on the FCC documents, and then the other people who were invested also own part of this. And MobileX had a 107,000 customers, and I think apparently it's 200,000,000 valued at. That's a really, really good valuation for a 100,000 subs. You know, the whole thing highlights again that as an MVNO, you're an integral part of a carrier strategy, and that your success partially depends on how well you can work together with the different providers. From what I know, Peter and Charlie, they're talking for years.

Roger Entner 1m50s

Right? And so eventually, something happened. You know, either Peter would have bought Boost or Charlie would buy buy this, so whatever. Right? But it's really reflection here that Peter bought something really, really interesting in mobile x.

Roger Entner 2m10s

And at the same time, you know, I think he said it himself, it was time to go big or go home. The financial markets and the investment stuff ain't that great. Right? And so Charlie had money. Charlie needed somebody who can actually do wireless well.

Roger Entner 2m27s

And so there it is.

Don Kellogg 2m29s

Well, Peter's done this three times. Right? Boost, Amp, and now MobileX.

Roger Entner 2m33s

Yeah. And he did it in multiple countries, and this might go global. Yeah. And he just sold, like, a year ago or so. He sold Boost in Australia to Telstra, and focusing completely on this.

Roger Entner 2m48s

And so this will give Peter the financial backing of a genuine billionaire. Right? It gives access to probably the relationships to Elon Musk and Starlink, and could be really, really interesting. You know, we all know that Starlink will not get an MVNO from a wireless carrier until they build their own network. But it doesn't stop anybody from offering Starlink service with their mobile offer, which, you know, enter from the left US mobile has been doing for a couple of months.

Roger Entner 3m23s

And they were also in the news that they just extended their arrangement with Verizon, and that they had 1,100,000 mobile customers. So congrats. Well,

Don Kellogg 3m35s

so I think this is interesting because, you know, they're playing the old TracFone playbook, right, where they're sitting on multiple networks and kind of working with all the carriers and, you know, have unlimited plans through all the carriers. Although you have to have a different plan. I think it's like the dark star plan for AT&T and the warp plan for Verizon. But, you know, for so many years, TracFone was kinda doing something similar, and it's interesting to see somebody else running that playbook again.

Roger Entner 3m58s

Yeah. You know, and and we know that there's untapped demand for convergence for Starling customers. And so Peter has really interesting plans, and I think here he he can see the money that allows him to do this. You know, for the good and bad, Charlie Ergen is an incredibly hands on executive. And it will be very interesting how this goes from from fantasy to reality.

Roger Entner 4m27s

Right? It's like these guys have dated for a while, now they're married. And as we all know, it's a different ballgame. Right?

Don Kellogg 4m36s

Yeah. Yeah. That's what you find out who snores and that sort of thing. Right?

Roger Entner 4m39s

Yes. Exactly. And who puts the cap on the toothpaste and who doesn't? And Charlie is the one who has 60% of the stock. So we'll see what happens here.

Roger Entner 4m50s

You know, this could be really, really awesome. Or it could be not that this is tabloid fodder, but at least it could become trade press fodder. Because they either will hit it off spectacularly, or this will like blow up.

Don Kellogg 5m5s

Well, mean, they're both interesting individuals, and we've had fun covering both of them over the years. Right?

Roger Entner 5m10s

Yeah. Exactly. Very colorful. I hope that Peter will come, and I'm pretty sure he will come, to talk about this when we can actually talk a little bit more substantial about this. And then we'll see what happens.

Don Kellogg 5m23s

Well, I mean, I think the other thing is, you know, typically MVNO exits are being purchased by an MNO. I guess Charlie is still kind of an MNO, but definitely not one of the bigger three MNOs. Right?

Roger Entner 5m33s

Well, no. He's no longer an MNO. He there's nothing left. He's an MVNO.

Don Kellogg 5m37s

Well, he owns lots of spectrum. Right? But, like, that's about it. So

Roger Entner 5m41s

There's a little bit left like AWS three. The question is when will he sell it? But, yeah, there's no network. There's nothing.

Don Kellogg 5m49s

He's not an operator anymore.

Roger Entner 5m50s

He's not an operator anymore. He left he left that game. Right? Yep. Yep.

Roger Entner 5m55s

The question is when will he stop being a satellite provider too?

Don Kellogg 5m59s

Right. Well, they don't stay up there forever. Right?

Roger Entner 6m1s

They don't stay up forever, and they haven't launched anything anytime. And Starlink is eating his lunch. Thank God he has couple billion dollars of Starlink shares. Right?

Don Kellogg 6m14s

Right. Right. It'll be fun to keep an eye on it, and I'm sure that we'll get a lot of entertainment out of The US mobile developments as well.

Roger Entner 6m21s

I'm counting on it. Alright.

Don Kellogg 6m24s

Alright. We'll talk to you next week.

Roger Entner 6m25s

Thank you. Bye bye.