Sprint wants to buy U.S. Cellular’s spectrum and users for $480 million

By , Nov 7, 2012

Carrier Sprint today announced that it has entered into a definitive agreement with U.S. Cellular about purchasing its PCS spectrum and customers in Midwest U.S. for $480 million in cash. This effort to boost network capacity is subject to regulatory approvals and is expected to close in mid-2013. Sprint will use the additional spectrum to broaden its own coverage in these areas…

The spectrum and customers that are part of the deal include markets such as Illinois, Indiana, Michigan, Missouri and Ohio, including the Chicago and St. Louis. Specifically, Sprint will acquire 20 MHz of PCS spectrum in the 1900 MHz band in Chicago, South Bend, Ind. and Champaign and 10 MHz of PCS spectrum in the St. Louis market.

A media release quotes CEO Dan Hesse who highlighted the benefits:

This transaction will enable us to strengthen our business and become a more robust competitor.

Acquiring this spectrum will significantly increase Sprint’s network capacity and improve the customer experience in several important Midwest markets including Chicago and St. Louis.

The carrier notes that terms of service for U.S. Cellular customers won’t change until the deal is closed, when transition plans will be detailed. U.S. Cellular customers can find out more about the repercussion of the partnership at this web site.

Sprint arrived late at the 4G LTE party and as a result now has to spend money on mergers and acquisitions in order to get its network up to speed.

The company activated 1.5 million iPhones on its network in the third quarter, same as in the previous quarter. Key metrics, however, remain grim as Sprint reported a net loss of $767 million. Still, that’s a notable improvement from a huge $1.38 billion net loss reported in the June quarter.

The nation’s #3 carrier recently acquired control of Clearwire and is mulling a $20 billion partnership with Japan’s Softbank that would see the latter obtain the controlling interest in Sprint.

Is this a clever move on Sprint’s part?

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  • iHamzaDev

    I see Sprint’s network and business improving drastically in 2013 and 2014. It all depends on what kid of decisions Sprint makes because they are at a very delicate platform right now. Although I personally see Sprint coming up and competing at AT&T and Verizon’s level in terms of LTE coverage and faster 3G coverage. Just a matter of time. Never underestimate the underdog.

    • Kaptivator

      I agree. Just wondering if they will keep there unlimited plan once they are in a position to compete with AT&T and VZW.

      • iHamzaDev

        I’m sure they will. If the purchase of SoftBank goes through, then I’m pretty sure Sprint will keep the Unlimited data plan.

      • Machoot

        I definitely hope so, especially being a US Cellular customer. The unlimited plan was one of the major reasons I was considering switching to Sprint when my contract with USC ran out. Hopefully Sprint can maintain. AT&T and Verizon’s data models and prices are a bit ridiculous and they need a well-priced competitor on the national level.

  • D..

    I personally hope they don’t take over usc.for the simple fact that when they bought Nextel. Customer service and coverage went straight in the toliot.