Monday, March 16, 2009

Can US Cellular Survive?

Today an article from Reuters reports that some of US Cellular's owners are pushing to sell the network to a larger rival. They claim US Cellular won't be able to keep up with the Big 4 carriers and income will erode as the larger carriers introduce more expensive technologies. The sad part is that many of us were hoping that US Cellular would be the buyer of the Alltel divested markets that must be spun off by Verizon Wireless. In the last report of buyers interested in Alltel, US Cellular wasn't among them, and now we may know why.

Fortunately, the owners who want US Cellular to sell out have only a 15% stake in the parent company, TDS. The people with the power in US Cellular is the Carlson family who controls 51% of the votes. These private owners can do what they please, even if owning the 6th largest cellular company in the US doesn't make maximum use of financial assets. They could hold on to the company just for the fun of it. And we hope they do.

We're also still hoping that the Alltel leftovers will be used to either add to or create a new regional cellular carrier, and maybe those new owners might look at buying both Alltel and US Cellular. It should scare everyone reading this that there is a possibility we will could lose yet another large carrier, and even maintaining all of the Big 4 is in question. there someone with a few extra billion available to keep these carriers out of the wrong hands? Please.

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