Given what T-Mobile (NASDAQ:TMUS) CEO John Legere has done in the wireless phone industry, the idea of him running a major pay television provider creates all sorts of tantalizing possibilities.
That could happen as Legere's company has been talking with DISH Network (NASDAQ:DISH) about a merger of the two companies, The Wall Street Journal reported [subscription required]. Were that deal to happen, the paper explained, they are in agreement that Legere would lead the combined company as CEO, while DISH's Charlie Ergen would serve as chairman.
The merger would create a company with an interesting array of products that would rival the combined AT&T (NYSE:T) and DirecTV (NASDAQ:DTV), which are merging pending regulatory approval. It would also pair two powerful, maverick executives and give Legere a chance to give an industry that ranks at the bottom of the recent American Consumer Satisfaction Index a much-needed kick in the pants. Click here for fellow Fool Anders Bylund's take on a merger's prospects and what it could mean for DISH, and read on for my take on the Legere angle.
Legere brings credibility
DISH has always been a bit of an outlier in the pay television industry in that satellite TV has been positioned as a cable alternative, and the company itself has been pushed as a rival to category leader DirecTV. Legere is the ultimate outsider, and his presence at the helm would likely make many of the 56.8 million customers T-Mobile closed the first quarter of 2015 with at least consider jumping to either a DISH satellite package or the company's streaming Sling TV live television offering.
Legere built T-Mobile over the last two years by declaring it the Un-carrier -- and living up to that name. Starting with the dropping of contracts, the company has quickly shed most of the things consumers dislike about wireless companies. Under the outspoken CEO, the carrier has increased transparency and made it easy for customers to know what they will be paying.
That has included dropping overage charges -- a traditional moneymaker for the wireless industry that's a major customer turnoff. Legere has managed to make his company a low-cost alternative where consumers actually pay full price for phones. He has done that by building a reputation for honesty and delivering on his promises.
It's easy to see how the "un-carrier" approach could be applied to the cable business. Legere could simplify DISH's billing plans and get rid of confusing teaser offers and advertised pricing plans that don't reflect what people will actually pay. There are few, if any, executives in the pay television world whose word would be accepted at face value by the public, and the fact that Legere would immediately top that list brings tremendous value.
Legere brings attention
One of the ways T-Mobile has grown is by Legere's knack for getting attention for his company's un-carrier efforts and his willingness to call out the shenanigans of his competitors.
Recently, Verizon (NYSE:VZ) ran ads using the tag line "Never Settle." Legere agreed that customers should never settle, but he very publicly took issue with the claims Verizon was making.
To counteract them, T-Mobile created a campaign of its own, "laying out the facts and all the ways wireless users should never settle," the company said in a press release. It detailed "never settling" to include not settling for "an old carrier that penalizes you for using too much data, locks you into a two-year contract, makes you pay to leave, makes you wait to upgrade your phone, overcharges you outside the country or repossesses your unused data every month."
The campaign was kicked off with some typical, attention-getting talk from Legere:
Last week, I said we would hit right back at Verizon -- I meant it. T-Mobile's 4G LTE network is the nation's fastest. Not faster for the price... just faster, period. With T-Mobile, you don't have to settle for trickery, gimmicks and carrier BS the way you do with Verizon. I'm so confident in our kick-ass network experience that we're footing the bill so Verizon customers can give T-Mobile a try.
It was a bold, but typical move from the CEO who never lets pass an opportunity to demonstrate how his competitors are attempting to pull one over on the public. He could do the same with DISH and bring some much-needed attention to Sling TV, which is itself an un-carrier-like product that disrupts the traditional way of doing things.
Just turn him loose
DISH and T-Mobile have compatible product lines that could be marketed well together. More importantly, Legere is the perfect executive to run a pay television company that is trying to upset the industry norms. He's outspoken and a bit of a character, but he has demonstrated competence and a steady hand.
The pay television industry is in a time of change anyway, and Legere could make sure DISH emerges as a leader.
Daniel Kline owns shares of Apple. He looks a bit like a younger, less-in-shape Legere. The Motley Fool recommends Apple and Verizon Communications. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.