Following T-Mobile's acquisition of Sprint for $26.5 billion, the U.S. wireless market saw a reduction in major carriers, raising concerns over competition and potential price hikes for consumers. To counter this trend, Dish Network stepped in, acquiring Boost Mobile and positioning itself as the fourth major carrier operating its own infrastructure.

EchoStar's Acquisition and Debt Issues

However, after EchoStar purchased Dish Network on December 31, 2023, it faced a substantial financial burden of $30 billion in debt. This debt became critical when EchoStar decided to sell a significant 30MHz of mid-band spectrum to AT&T for $23 billion. This move was prompted partly due to regulatory pressures from the FCC, which also nudged EchoStar to divest spectrum to rival Elon Musk’s SpaceX. The subsequent transactions led to Dish halting development of its standalone 5G network.

As it stands, Dish Wireless' Boost Mobile has transformed into a hybrid mobile virtual network operator (MVNO), primarily depending on both AT&T and T-Mobile's networks. The debt situation was exacerbated when EchoStar ceased lease payments to American Tower, a key cell tower operator in the U.S., leading to Dish leasing space on their towers.

Dish stopped its lease payments to American Tower, citing the need to sell its spectrum as the cause. This has escalated into legal action, as American Tower filed an SEC Form 8-K on Wednesday, revealing that Dish Wireless defaulted on tower rental payments as stipulated in a March 2021 agreement. Dish had previously warned American Tower of its possible inability to fulfill payment obligations.

American Tower insists that the agreement remains valid, refuting Dish’s claims that it was coerced into selling its spectrum. They regard such sales not as forced but rather as strategic business decisions yielding substantial revenue for EchoStar. Dish maintains that force majeure should apply here, allowing them to retract from their contractual obligations due to extraordinary circumstances.

Similarly, Crown Castle has reported a default by Dish on its cell tower payments and is also pursuing legal action. Analysts have estimated that payments owed by Dish to American Tower are comparable to the $3.5 billion claimed by Crown Castle.

Despite these defaults, American Tower stated that the impact on their financial reports for Q4 2025 and the full year will not be significantly affected. However, they refrained from specifying the losses incurred due to Dish’s default.

American Tower's shares closed last week at $179.27, hovering closer to its 52-week low of $166.88, while Crown Castle closed at $86.81, also nearer its low of $83.21. As for EchoStar, its stock price was noted at $113.22, experiencing a significant drop of 10.5% following its earnings report.