Part 2
UPDATE UScellular’s towers and spectrum are the assets that may generate the most interest as potential partners or buyers study the company. But the company’s wireless business is also valuable, and could be a strategic acquisition for some partners.
Like all U.S. mobile network operators, UScellular has looked to enterprise customers to drive growth as consumer handset upgrade cycles have lengthened. The regional operator has focused on private networks and the Internet of Things, and has developed a flexible set of solutions for enterprise customers.
According to UScellular CTO Mike Irizarry, the operator’s cloud native 5G SA core can be deployed for private networks using open interfaces. Irizarry recently told Light Reading Nokia is the operator’s 5G SA core vendor. However, enterprise customers who deploy UScellular’s private network solutions will have choice when it comes to the RAN.
During WIA’s Connect (X) event earlier this year, Irizarry explained that UScellular’s 5G SA core “interfaces with different vendors” and he said private network customers can use their chosen RAN equipment with UScellular’s core. He said the operator has also developed a solution that will allow enterprise customers to use their RAN with UScellular’s spectrum and core, but as of May, that had not yet been deployed.
During UScellular’s recent Q2 earnings call, CEO Laurent Therivel said the carrier’s private networks business is growing and highlighted “a variety of different private networking deals with utilities.”
Relationships with utilities will be valuable to network operators as the national effort to close the digital divide gains momentum. Many utilities are becoming broadband providers, and although most use fiber, some are adding fixed wireless as well.
Fixed wireless is one of UScellular’s priorities. With a largely rural customer base, the operator estimates it has 2.7 million potential FWA customers. So far, it has signed up 100,000 subscribers, primarily using low-band and millimeter wave spectrum, and now the operator is starting to add mid-band spectrum for FWA.
During the company’s Q2 earnings call, CEO Laurent Therivel said the company is talking actively to state broadband officials about how UScellular can help deploy grants made through the Broadband Equity Access and Deployment program.
Therivel has been a longtime proponent of network sharing, and he reiterated his position on the call. “I simply don’t think that it makes economic sense to build four, five duplicative 5G or 6G networks in rural America,” the CEO said. He added that UScellular and another unnamed carrier are working on shared backhaul.
UScellular’s expertise with network sharing, open interfaces, and FWA are assets that potential buyers or partners will need to weigh against the wireless network’s marketplace performance. The carrier has lost postpaid subscribers during each of the last ten quarters, according to its published reports. At the end of Q2, the carrier had 4,194,000 postpaid subscribers, down 4.9 percent since its subscriber slide began at the start of 2021. Prepaid subs have declined 7.4 percent during the same period, and now stand at 462,000. And operating income was down 13 percent year-on-year for the 3 months ended June 30, and down 45 percent year-on-year for the first half of 2023.
The set of possible buyers capable of reversing the UScellular network’s trajectory is likely small. But a larger set of partners may show interest in the carrier’s network technology, particularly the cloud native 5G SA core, which has applications that stretch beyond serving consumers on a public mobile network.
By Martha DeGrasse, Inside Towers Contributing Analyst
This article represents the opinions of veteran telecom industry editor and journalist Martha DeGrasse, an Inside Towers Contributing Analyst with features appearing monthly. DeGrasse owns Network Builder Reports and contributes regularly to several publications. She was formerly a writer and editor with RCR Wireless and a TV business news producer.
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