U.S. Cellular lures customers by paying them $300 to switch carriers

Tools

Tier 2 operator U.S. Cellular (NYSE:USM) is pulling out all the stops in an attempt to lure more customers to its service. The carrier said it will give new customers a prepaid debit card loaded with $300 if they switch two lines of service from their current carrier to U.S. Cellular and activate a smartphone.

The company is currently offering a selection of subsidized smartphones, including the Samsung Galaxy S III for $149.99 with a two-year agreement and the Huawei Ascend Y for 1 cent with a two-year agreement.

U.S. Cellular isn't the first operator to offer cash to customers who switch to their service. However, the $300 price-tag is notable because it's one of the higher dollar amounts offered. The Tier 2 carrier has been struggling for some time to keep its customers from churning to one of its larger Tier 1 competitors.

However, in third quarter U.S. Cellular reported 9,000 net subscriber additions, which was an improvement after successive quarters of net subscriber losses. U.S. Cellular ended the third quarter with 5.8 million subscribers.

U.S. Cellular also is in the midst of rolling out LTE, and it planned to have 58 percent of its footprint covered with LTE by year-end 2012.  

In November, the company announced a deal to sell some of its major Midwestern markets and spectrum to Sprint Nextel (NYSE:S) for $480 million. As part of the deal, U.S. Cellular will offload its Chicago, St. Louis, central Illinois and three other Midwest markets to Sprint. The deal includes a transfer of PCS spectrum and around 585,000 customers, or about 10 percent of U.S. Cellular's total customer base, to Sprint. The deal requires approval from regulators at the FCC and Department of Justice and is expected to close by mid-year.

For more:
- see this Phone Arena article

Related Articles:
U.S. Cellular testing VoLTE, will launch 'at some point in the future'
U.S. Cellular to sell Midwestern markets, spectrum to Sprint for $480M
U.S. Cellular, T-Mobile USA subsidies among winners of $300M Mobility Fund auction
U.S. Cellular increases smartphone sales, but still loses subs in Q2
U.S. Cellular launches 'Hello Better' ad campaign focused on customer service
U.S. Cellular overhauls voice, data pricing plans, promises LTE expansion