U.S. Cellular to Begin Offering Apple Products Later This Year

[MacRumors]

As part of its quarterly earnings release today, U.S. Cellular announced that it will begin carrying Apple products later this year, although the carrier offered no additional details on its plans.

"We have a number of strategies in progress to increase loyalty and attract more customers, including our announcement today that we will begin offering Apple products later this year. By further strengthening our device portfolio, we'll give consumers another great reason to switch to U.S. Cellular, and enable our existing customers to choose from an even wider variety of iconic smartphones, and enjoy the outstanding U.S. Cellular customer experiences they deserve. Our smartphone penetration is currently 43 percent of core market customers and growing quickly. We believe there will be strong, ongoing demand for smartphones and data products and services from our customers, and we have significant room for growth in this area.

The move marks a reversal for U.S. Cellular, which said in late 2011 that it had declined to carry the iPhone due to "unacceptable" terms being offered by Apple.

Carriers offering the iPhone generally see short-term hits to their profitability due to upfront subsidies that are typical in the U.S. wireless industry, although many carriers have viewed that impact as acceptable in order to gain access to the popular device. Apple has also routinely demanded that carriers commit to purchasing certain numbers of iPhones over a period of years, something that some carriers have been reluctant to do for fear of being stuck with unsold devices.

U.S. Cellular, which has 5.7 million subscribers, may become the last of the top U.S. carriers to offer the iPhone. Major carriers Verizon, AT&T, Sprint, and T-Mobile all now offer the device, while Leap Wireless/Cricket began selling the iPhone last year. MetroPCS is also likely to begin offering the iPhone following its merger with T-Mobile, although an offering is said to not be imminent. The last of the top carriers, TracFone, also offers the iPhone through its Straight Talk partnership with Walmart.

Update 9:37 AM: U.S. Cellular has issued an additional statement to AllThingsD:

We will be selling iPhone products later this year. We don't have any additional information at this time but will follow up closer to the launch. The deal we've made to sell iPhone products is right for our business today, because we now have an LTE solution that enables a successful partnership with Apple.

Update 10:27 AM: Dow Jones Newswires reports that U.S. Cellular has committed to purchase $1.2 billion worth of iPhones over a three-year period.

Article Link: U.S. Cellular to Begin Offering Apple Products Later This Year

 

[panerista]

"Top" US carriers. US Cellular? The same US Cellular that left Chicago despite having stadium rights there?

 

[street.cory]

The move marks a reversal for U.S. Cellular, which said in late 2011 that it had declined to carry the iPhone due to "unacceptable" terms being offered by Apple.

2011 is the year we switched to AT&T and this was the reason.

We'd been customers with US Cellular for about 11 years and had pretty good customer service, coverage, etc.. but their smartphone selection had been abysmal for the longest time. Of course when we switched to AT&T they started offering more advanced Android phones because Mary N. Dillon had taken over.

 

[snebes]

"Top" US carriers. US Cellular? The same US Cellular that left Chicago despite having stadium rights there?

Was about the say the same thing. I'm not even a USCC customer and I am appalled by their actions here. Selling their customers to Sprint, and forcing everyone to get a new phone (due to incompatibility, even though both are CDMA). Talk about a company giving the middle finger to its partner stores, customers, and customer choice in the midwest.

 

[truettray]

This is huge for the mid-west. I don't personally use US Cellular, but my office does! This could be good for us.

 

[Mazeman]

My wife has US Cellular, and in our travels it has consistently had much better coverage than AT&T or Verizon.

 

[HashPipeK]

My wife has US Cellular, and in our travels it has consistently had much better coverage than AT&T or Verizon.

I don't think travels means what you think it means. If you leave their home footprint (which they make very hard to find, and lie and say they are a national carrier), their roaming agreements are beyond a joke you basically get no data service while traveling.

That said they have very good LTE coverage in many of their home footprints.

 

[Four oF NINE]

This could be a huge advantage for Apple now!

 

[liavman]

Geez, it is about time.

 

[Benski007]

I am personally excited about this. My family left U.S. Cellular's great customer service and reception for Verizon almost 2 years ago because of U.S. Cellular's lack of Apple products. I can't wait to switch back to their awesome call quality. I'm looking forward to being able to walk anywhere in my house when I'm on a call again, instead of having to be on our second floor with Verizon. In most markets Verizon has great service, but here in Milwaukee they use PCS spectrum and it's horrible.

 

[mrbrown]

I didn't even know they were still in business until a few days ago when my co-worker mentioned that they were his provider.

 

[DJsteveSD]

and yet we are still waiting for service pricing to go down...

 

[charlien]

About time. They are the only carrier that works in my house.

 

[sessamoid]

I guess they realized (finally) the cost of refusing to carry the iPhone. Their latest financial quarters have been an unmitigated disaster. They're bleeding cash and subscribers. They HAD to sell off Chicago to Sprint because they were so short on cash they couldn't have funded the upgrade to LTE otherwise.

 

[TouchMint.com]

2011 is the year we switched to AT&T and this was the reason.

We'd been customers with US Cellular for about 11 years and had pretty good customer service, coverage, etc.. but their smartphone selection had been abysmal for the longest time. Of course when we switched to AT&T they started offering more advanced Android phones because Mary N. Dillon had taken over.

Yep same here but I think for us it happened in 2009.

 

[mattnotis]

I wonder how long it'll take before Verizon or AT&T buys them.

 

[autrefois]

According to the OP, U.S. Cellular said "We will be selling iPhone products later this year," and looking at their press release, I see it only mentions "Apple products." (emphasis mine)

I don't know about you, but my money is on them selling leftover iPhone bumpers.

-------
Sent from my "iPhone product"

 

[farmermac]

I left US Cellular in 2009 for the iPhone. They are the best carrier in Iowa hands down, as far as coverage goes. Their plans used to not have free roaming though, so we'll see. I can predict we'll be switching back to US cellular and ditching AT&T when they get these.

 

[Benski007]

According to the OP, U.S. Cellular said "We will be selling iPhone products later this year," and looking at their press release, I see it only mentions "Apple products." (emphasis mine)

I don't know about you, but my money is on them selling leftover iPhone bumpers.

I know you are being sarcastic about the bumper comment, but I think you and other people are wondering what "Apple products" means and if it implies the iPhone. Later in the conference call the CEO, Mary Dillon, state that they are hoping to have lower churn when they offer the iPhone. So, they will definitely be carrying the iPhone, but maybe the iPad too.

 

[autrefois]

I know you are being sarcastic about the bumper comment, but I think you and other people are wondering what "Apple products" means and if it implies the iPhone. Later in the conference call the CEO, Mary Dillon, state that they are hoping to have lower churn when they offer the iPhone. So, they will definitely be carrying the iPhone, but maybe the iPad too.

Thank you for the clarification, that wasn't mentioned in the links. That would explain the choice of the word "product" — they're being intentionally vague I guess to be more inclusive. Since the CEO specifically mentioned iPhone in the conference call, I assume she would be well-placed to know!

 

[mac-savant]

You know, I seem to recall hearing a US Cellular radio commercial that said that anyone that wanted an iPhone was stupid.

That must be their target market now.

Anyone know where we can find a transcript or recording of that commercial?

 

[Koodauw]

You know, I seem to recall hearing a US Cellular radio commercial that said that anyone that wanted an iPhone was stupid.

That must be their target market now.

Anyone know where we can find a transcript or recording of that commercial?

Taking money from fools has proven to be very profitable.

$1.2 Billion seems like a lot of phones.

 

[Renzatic]

Taking money from fools has proven to be very profitable.

I like to think I'm paying a premium for quality. Insert some pithy analogy about a BMW vs. a Nissan here.

 

[grimmly96]

It comes down to MHz

This is nerdy but it's the real explanation of why US Cellular has not matched the other carriers for phones and has not had the iPhone. It's about MHz. US Cellular and several other smaller carriers own 700 MHz A Block and B Block spectrum. Verizon is in 700 MHz C Block. When Apple released the first CDMA iPhone it wasn't LTE so US Cellular could have bought it and used their 3G network for the data connection but they may have seen a bigger issue looming and that was that they where having a really tough time getting Android phones to be compatible with US Cellular's 700 A Block. All the manufacturers wanted to match Verizon C Block and not focus on the A Block for LTE. For the Galaxy S III US Cellular had to cut a deal with Samsung (PR called it "partnering") to launch the phone on their unique spectrum; i.e. the spectrum we own is being ignored by the phone makers and leaving us high and dry. Ever wonder why US Cellular seems to be a few months behind on getting the latest device? This is also the source of all the letters by smaller carriers to the FCC to make all LTE devices fully interoperable - i.e. force any licensed phone to run on all 700 MHz blocks and not just one or two.

C-Spire had the same problem with spectrum as US Cellular and realized much sooner that US Cellular did that it should just ditch it's 700 MHz spectrum for LTE and instead leverage existing 2G and 3G 850 MHz frequencies for LTE. US Cellular is a much bigger ship than US Cellular so it probably took a lot longer to turn the ship around but now they are finally doing that; read the fine print where they mention refarming their 850 MHz for LTE. Once they have 850 MHz LTE they can sell the iPhone at LTE speeds. I'm sure they would have done it sooner but they couldn't offer it to customers at full LTE speeds which means they would have committed to buying a bunch of iPhones that they would have had to sell that couldn't leverage the LTE speeds of the device. That would keep existing customers away from it and make people looking for an iPhone decide not to choose them; a lose-lose when you have to move X amount of iPhones per month to keep up your part of the agreement with Apple.

As for the the commercials, yeah, those where stupid. Anytime you make negative ads like that be prepared to eat crow.

As for the Chicago market, Chicago was always among the worst performing market for them and had their lowest penetration percentage.

 

[jianghb]

Top" US carriers. US Cellular?