U.S. Cellular to Sell South Texas Market Operations to AT&T Wireless

[Gonz]

For More Information, contact:
Mark A. Steinkrauss, Vice President
Corporate Relations - TDS
(312) 592-5384

FOR IMMEDIATE RELEASE:

U.S. CELLULAR TO SELL SOUTH TEXAS MARKET OPERATIONS TO AT&T WIRELESS

November 26, 2003, CHICAGO – United States Cellular Corporation [AMEX:USM] today announced that it has entered into a definitive agreement to sell certain wireless properties to AT&T Wireless Services, Inc. [NYSE: AWE] of Redmond, Wash. for $95 million in cash, subject to certain closing provisions. The transaction is subject to regulatory approval and is expected to close in the first quarter of 2004.

The U.S. Cellular assets to be sold to AT&T Wireless include 25 MHz Metropolitan Statistical Area (MSA) and Rural Service Area (RSA) licenses representing 1.3 million population equivalents, approximately 150 cell sites and 74,000 customers. For the nine months ending Sept. 30, 2003, total U.S. Cellular revenue from these markets was $45 million.

The markets to be sold include MSA operations in Corpus Christi, Laredo and Victoria, Texas, as well as RSA operations in Texas RSA 18, 19 and 20. A complete list of the licenses can be found in Exhibit A (below). View the map illustrating the properties to be sold.

John E. Rooney, president and chief executive officer of U.S. Cellular, commented, “This transaction is further affirmation of our strategy to exit markets that are not strategic to the company’s long-term success. These properties, while valuable in their own right, neither complement the geographic footprint of the company nor strengthen its competitive position in its larger, more well-established markets.

“Proceeds from the sale may be used to reduce debt or offset the cost of building out several of the new markets we acquired recently from AT&T Wireless in another transaction or to fund spending requirements related to our technology upgrade to CDMA 1XRTT,” said Rooney.

Falkenberg Capital Corporation of Denver, Colo. represented U.S. Cellular in the transaction.

As of Sept. 30, U.S. Cellular Corporation, the nation's eighth largest wireless service carrier, provided wireless service to nearly 4.3 million customers in 141 markets throughout 25 states. The Chicago-based company operates on a customer satisfaction strategy, meeting customer needs by providing a comprehensive range of wireless products and services, superior customer support and a high-quality network.


EXHIBIT A

Market
Market Number

Managed Markets


TX 18
RSA #669

TX 19
RSA #670

TX 20
RSA #671

Corpus Christi, TX
MSA #112

Laredo, TX
MSA #281

Victoria, TX
MSA #300

Brownsville, TX fill-in
MSA #162 A2

McAllen, TX fill-in
MSA #128 A2




All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company’s plans, beliefs, estimates and expectations. These statements are based on current estimates and projections, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: changes in circumstances or events that may affect the ability of the company to start up the operations of the properties previously acquired in a transaction with AWE; the ability of the company to manage and grow the operations of the Chicago MTA; changes in the overall economy; changes in competition in the markets in which the company operates; advances in telecommunications technology; changes brought about by the implementation of wireless number portability; changes in the telecommunications regulatory environment; changes in the value of investments, including variable prepaid forward contracts; changes in the capital markets that could adversely impact the availability, cost and terms of financing; an adverse change in the ratings afforded our debt securities by nationally accredited ratings organizations; pending and future litigation; acquisitions/divestitures of properties and/or licenses; changes in customer growth rates, retail service revenue per unit, churn rates, roaming rates and the mix of products and services offered in the company’s markets. Investors are encouraged to consider these and other risks and uncertainties that are discussed in documents filed by the company with the Securities and Exchange Commission.

Looks Like USCC is really focusing on the midwest now... Seems that they have become a major trader with AT&T. Interesting... I wonder what will come next.. Hopefully Michigan!

[jayc]

What are your thoughts on this? Do you think it shows whats to come for USCC? Will they eventually sell all markets one at a time? [img]i/expressions/face-icon-small-smile.gif[/img]

[GoodmanR]

I doubt it. They just want to raise money for capital improvements. USCC is one of the healthier wireless companies with lowest churn rate, i doubt theyll sell out anytime soon.

Alltel though, might...

[MOTOhooligan]

Too bad CellularONE could not obtain those assets and beef up the already quite impressive rural Texas coverage.

[SNSE]

I have a thought about that huge Texas coverage......Hire some performance engineers that have a clue! Coverage does not necessarily equal SERVICE. I spend 30 to 40% of my minutes out there on Western Wireless, and I gotta tell you, I thought AT&T was bad. In most of West Texas, I can't make a handoff with a car kit and roof mount antenna. I'm not the only one that sees this. It's been this way for two years now, and of course, they've got to go play with deploying digital to satisfy their roaming agreement with AT&T, so it won't get fixed. Note to Bellevue, WA: Fix your system, for it sucketh mightily. Just a casual observation from a user in the field.

[jayc]

lol

[ILUVSOCAL]

Sounds like Verizon in my area of Northern California, though we have neither good coverage or service.

[MOTOhooligan]

Coverage is determined by population density. The most heavily populated areas get the most attention for service issues. It's the same will all wireless providers. Depending on where you are in West TX they will probably never fix the service because there are only 5 people, tumbleweeds and 400 cows that live there. That's a problem when you have service with a provider who focuses on mostly rural markets. Luckily I live in a pretty large town so I never have issues with my service. Sorry about your issues, though.

That's a major problem with wireless service in the U.S... there is never going to be a seamless network because the land area is just too large. Living in someplace like Japan would be nice (at least from a wireless perspective) because there isn't that much area to cover so, from what I've heard the coverage is pretty much solid everywhere even if you are sometimes roaming on other carriers networks.

[SNSE]

Coverage is determined by population density. The most heavily populated areas get the most attention for service issues. It's the same will all wireless providers. Depending on where you are in West TX they will probably never fix the service because there are only 5 people, tumbleweeds and 400 cows that live there.

Unfortunately, I'm talking about LUBBOCK, ABILENE (including the I-20 corridor), MIDLAND, and anywhere in between Amarillo and Wichita Falls. Those are some heavily traveled, and heavy usage areas (Not to mention more people that cattle). I can't imagine for the life of me why in the world you can't keep up a call standing perfectly still, with your head at 15 degrees, left arm straight out, and right toe slightly elevated and still handoff to the crappiest cell half a county away. It boggles my mind to think what the folks who look at performance numbers must be doing....(oh wait, that might be considered pornography), and I've been running and installing networks for over 10 years now, and I would have been fired a long time ago for an unacceptable network like that if it were mine. Sorry folks, but Western Wireless has some MAJOR issues, and not just in Texas.

[MOTOhooligan]

That was my point, that CellularONE could use those lisences to improve coverage in Texas. The reason that you may be having trouble with your service in these areas is that CellularONE is almost entirely CDMA in Texas now (except for the Rio Grande Valley) which means that most of the bandwidth is being used by CDMA customers and roamers, not TDMA so if you're using your 6360 that may explain the problem. While there is TDMA bandwidth reserved for roamers and people (like myself) that have not converted from TDMA to CDMA handsets it definitly is not the dominant service CellularONE provides. I have sometimes run into blocking issues where I can't use my phone because too many other people are using theirs but that usually clears up after a while.

[SNSE]

Rancid, I build these networks for a living, and I have had to maintain them. It's not a blocking problem, it's a maintenance and switch problem. You have to care whether or not it works, and you have to have people in the field, and in the switch that CAN make it work. If you ignore it, and decide to worry more about CDMA, then this is what happens. You have customers on BOTH networks, and you have to maintain BOTH networks. It's not a bandwidth problem. Funny that other carriers have TDMA and CDMA in the same market, and they seem to be able to maintain it, and make it work just fine......hmmm........

[MOTOhooligan]

I know we have CDMA and TDMA in the same market (probably GSM overlays for roaming, too.) There just isn't as much TDMA as CDMA anymore. If it's affecting your life so much you should probably call WWC CellularONE Technical Support and report it to them so they can fix it.