T-Mobile to acquire UScellular

[Conan Kudo]

T-Mobile has officially announced it's acquiring all of UScellular.

Quote

Bellevue, Wash. – May 28, 2024 – T-Mobile (NASDAQ: TMUS) and UScellular (NYSE: USM) today announced that T-Mobile has agreed to acquire substantially all of UScellular’s wireless operations. This includes UScellular’s wireless customers and stores, as well as certain specified spectrum assets. 

https://www.t-mobile.com/news/business/uscellular-acquisition-operations-assets

[iansltx]

Most of. Some of the spectrum and all of the towers are staying with USCC. Guessing the 850 is staying with USCC, as T-Mobile has no use for it with their current network setup. Maybe mmW will stay if USCC wants to keep doing the FWA thing with that spectrum (though probably not). Will also be interesting to see who gets their C-Band (probably T-Mobile).

[Trip]

From the investor relations slide:

"T-Mobile will acquire approximately 30% of UScellular’s spectrum portfolio, including all of the company’s 600 MHz(1), 2.5 GHz and 24 GHz, as well as the majority of its 700 MHz A Block, AWS and PCS holdings"

https://imgur.com/a/KU8cCFO

https://s24.q4cdn.com/321867585/files/doc_presentations/2024/Sale-of-Wireless-Operations-Presentation.pdf

- Trip

[S4GRU]

Anyone want to do a quick write up for the wall on this proposed transaction?

Robert

[clbowens]

2 hours ago, S4GRU said:

Anyone want to do a quick write up for the wall on this proposed transaction?

Robert

It would be interesting to see exactly which additional 2K towers they have access to.

[S4GRU]

15 hours ago, clbowens said:

It would be interesting to see exactly which additional 2K towers they have access to.

Yes, I'm very curious.  Tmo has been colocating on most of the USCC towers in my region the past 4 years. I think there's only like 3-4 left they're not on.

Robert

[Trip]

There's plenty of towers that US Cellular has that T-Mobile isn't on.  My guess is that T-Mobile picked out exactly which towers they wanted to stay on.

I made a map, because of course I did.  Here's where I grew up, for example:

https://imgur.com/a/YPoQtw8

Pink is T-Mo, Blue is US Cellular.  (Yellow is unkept Sprint, gold were sites Shentel planned but never got to build.)

If they kept every non-colocated site in Charlotte County, that's 12 right there.  Three more in Prince Edward (I'm pretty sure they'll keep all three).  And there are plenty of other places like this.

- Trip

[chamb]

47 minutes ago, Trip said:

There's plenty of towers that US Cellular has that T-Mobile isn't on.  My guess is that T-Mobile picked out exactly which towers they wanted to stay on.

I made a map, because of course I did.  Here's where I grew up, for example:

https://imgur.com/a/YPoQtw8

Pink is T-Mo, Blue is US Cellular.  (Yellow is unkept Sprint, gold were sites Shentel planned but never got to build.)

If they kept every non-colocated site in Charlotte County, that's 12 right there.  Three more in Prince Edward (I'm pretty sure they'll keep all three).  And there are plenty of other places like this.

- Trip

Yep, there may be an exception, but basically keep all the blue USC sites on this map and broadcast both PLMN's for awhile until it all sorts out.  Use the spectrum to favor 5G as it will be more popular in the next year.  Maybe just equip lightly for LTE as it is all but going to disappear.  It is mostly rural, so maybe they might not want to do n-41 heavily at some sites.

[dkyeager]

1 hour ago, chamb said:

 It is mostly rural, so maybe they might not want to do n-41 heavily at some sites.

Actually is another choice: vary the amount of mimo based on likely demand.

[Trip]

14 hours ago, chamb said:

It is mostly rural, so maybe they might not want to do n-41 heavily at some sites.

T-Mobile already didn't do n41 at the more rural Shentel sites they picked up.  (They also didn't deploy it on some of the new-build sites they did during the merger build-a-palooza outside of the Shentel region.)

I was actually thinking about this yesterday.  We'll have to see what commitments they make to the FCC when they file.  They may commit to providing n41--or at least, FWA--to x number of people, which could lead to a more significant n41 build-out than we would otherwise expect.  I remember being surprised by the amount of n41 they did in rural areas (like building n41 in Keysville, where I'm pretty sure the number of T-Mobile and Sprint customers approaches zero) when they were working on Sprint/Shentel's rural areas, and it had to do with FCC commitments. 

- Trip

[dkyeager]

4 hours ago, Trip said:

T-Mobile already didn't do n41 at the more rural Shentel sites they picked up.  (They also didn't deploy it on some of the new-build sites they did during the merger build-a-palooza outside of the Shentel region.)

T-Mobile has stated 15% of their sites don't have 5g triband. In WV I know WISPs had a lot of 2.5GHz, but T-Mobile was trying to buy as much as possible. More rural FWA would be a big selling point that might overcome any soft bandwidth cap slight overages. Especially since UScellular likely started offering it on c-band.

[Dkoellerwx]

On 5/29/2024 at 9:25 AM, S4GRU said:

Yes, I'm very curious.  Tmo has been colocating on most of the USCC towers in my region the past 4 years. I think there's only like 3-4 left they're not on.

Robert

Probably a lot of Midwest towers. Slight bias since Nebraska is a weird market, but there are tons of USCC sites that T-Mobile isn't yet co-located on. Think a similar situation in Iowa, Wisconsin, and Missouri. But some other markets, like yours, probably don't have that issue!

[iansltx]

A heavy n41 overlay as an acquisition condition would be a win for customers, and eventually a win for T-Mobile as that might be enough to preclude VZW/AT&T adding C-Band for FWA due to spreading the market too thinly (which means T-Mobile would just have local WISPs/wireline ISPs as competition). USCC spacing (which is likely for contiguous 700 MHz LTE coverage in rural areas) isn't going to be enough for contiguous n41 anyway, and I doubt they'll densify enough to get there.

[Trip]

On Reddit, someone asked (skeptically) if the US Cellular buyout would result in better service.  I'd been pondering this very issue, and decided to cross-post my response here:

I've been pondering the question in the title and I've come to the conclusion that the answer is that it's possible.

Hear me out.

Unlike some of the small carriers that work exclusively with one larger carrier, all three major carriers roam on US Cellular today in at least some areas, so far as I know. If that network ceases to exist, then the carriers would presumably want to recover those areas of lost service by building out natively. Thus, people in those areas who may only have service from US Cellular or from US Cellular and one other may gain competition from other carriers backfilling that loss.

How likely is it? I'm not sure. But it's definitely feasible. Most notably, AT&T did their big roaming deal with US Cellular in support of FirstNet in places where they lacked native coverage. They can't just lose a huge chunk of coverage whole still making FirstNet happy; I suspect they'll have to build out and recover at least some of that area, if not most of it.

So it'd be indirect, but I could imagine it.

- Trip

[radem]

10 hours ago, Trip said:

AT&T did their big roaming deal with US Cellular in support of FirstNet in places where they lacked native coverage. They can't just lose a huge chunk of coverage whole still making FirstNet happy; I suspect they'll have to build out and recover at least some of that area, if not most of it.

I think it is likely that T-Mobile will be forced to honor any existing US cellular roaming agreements in those areas as a condition of them taking over the spectrum.  In that case, there would be no improvement of service unless T-Mobile improves the service offering in those areas.

[Trip]

2 hours ago, radem said:

I think it is likely that T-Mobile will be forced to honor any existing US cellular roaming agreements in those areas as a condition of them taking over the spectrum.  In that case, there would be no improvement of service unless T-Mobile improves the service offering in those areas.

I assume that any agreement is not perpetual and has an end date.

- Trip

[Trip]

The FCC is finally opening a docket and expects the application to be filed "in the coming days."  Wonder what's taken so long to get this thing on file.

https://docs.fcc.gov/public/attachments/DA-24-925A1.pdf

- Trip

[Trip]

Here's at least one merger document.  It tells quite a story of US Cellular's struggles so far.  (I'm not very far into it yet.)

https://www.fcc.gov/ecfs/document/109132166915081/11

- Trip

[Trip]

Here's the ULS application.

https://wireless2.fcc.gov/UlsApp/ApplicationSearch/applMain.jsp?applID=14869446

It was cited way at the bottom of the 240+ page document.

- Trip

[S4GRU]

It feels really late for Tmo to buying USC now. They overbuilt so much of their area.  It's not a bad move. But it would have provided much more unique coverage earlier and would have captured more USC customers who have since churned. Probably a lot churned to Tmo as they have overbuilt them. 

Robert

[Trip]

24 minutes ago, S4GRU said:

It feels really late for Tmo to buying USC now. They overbuilt so much of their area.  It's not a bad move. But it would have provided much more unique coverage earlier and would have captured more USC customers who have since churned. Probably a lot churned to Tmo as they have overbuilt them. 

Robert

I don't disagree entirely but a lot of the really rural coverage (like where I grew up) still has little or no competition.  There is a lot of overlap but there are also a number of unique sites that will help things.

But also, the fact is that a lot of the rural T-Mobile coverage is still "map filler" coverage that doesn't actually provide reliable service.  This will help.

https://imgur.com/a/LRWF3FO

Using where I grew up as an example, magenta is T-Mobile, blue is US Cellular, and gold are unique sites Shentel planned but didn't get a chance to construct before the buyout derailed things.

EDIT: And even a number of the T-Mobile sites shown here are Shentel conversions.  The only reason for the site NW of Keysville is that Shentel built that one before the buyout pause.  The site southwest of Meherrin wasn't a Shentel conversion, although Shentel did plan to build there, but rather was added to fill a gap along US-360 when the Shentel conversions were taking place.  Three of the five sites in Farmville proper are Shentel conversions also, as is the one north of town just barely on the map.

- Trip