Tier 2 and Tier 3 operators such as U.S. Cellular (NYSE:USM), Shenandoah Telecommunications and Alaska Communications revealed the latest expansions to their LTE footprints during first quarter earnings calls. These small operators are in a rush to expand LTE coverage to keep up with their Tier 1 counterparts.
U.S. Cellular, which revealed plans to launch Apple's (NASDAQ:AAPL) iPhone later this year, said that in order to offer the iPhone and other products, it will refarm its 850 MHz spectrum and launch LTE in Band 5 later this year.
The company's LTE network currently is deployed on several different spectrum bands, including partner King Street Wireless' spectrum holdings in the Band 12 Lower 700 MHz A and B blocks and U.S. Cellular's own spectrum holdings in the 850 MHz band and Band 12 Lower 700 MHz A, B and C blocks.
By the year's end U.S. Cellular will have LTE coverage for 87 percent of its footprint, including cities in California, Kansas and Nebraska. In addition, its existing LTE footprint will be expanded to include cities in Illinois, Iowa, Maine, Maryland, Missouri, North Carolina, Oklahoma, Oregon, Tennessee, Texas, Virginia, Washington, West Virginia and Wisconsin.
U.S. Cellular also said it will increase its cap ex guidance by $130 million to fund the rollout of LTE in its 850 MHz spectrum. Most of that additional cost will go to new base stations that support Band 5.
Meanwhile, Sprint Nextel (NYSE:S) regional affiliate Shenandoah Telecommunications (Shentel) reported that 75 percent of its covered POPs have LTE, and it has LTE deployed in 276 sites using gear from Alcatel-Lucent. The company first launched LTE service last November. Its coverage area includes parts of Maryland, Pennsylvania, Virginia and West Virginia.
Interestingly, the company reported strong demand for the iPhone. The iPhone now represents 26 percent of new gross adds at Shentel and more than 21 percent of the company's postpaid users have an iPhone.
Alaska Communications also is expanding its LTE coverage. The company, which announced last November that it had launched LTE in 10 cities, including Juneau, Anchorage, Fairbanks, Homer, Kenai, Palmer, Seward, Soldotna, Wasilla and Whittier, is increasing its coverage through a joint venture with GCI.
That venture, called Alaska Wireless Network, will cover 95 percent of the state's population. Company executives said that the AWN deal is set to close this quarter.
Alaska executives are anxious to finalize the deal before this summer when Verizon (NYSE:VZ) is expected to enter the Alaska market and launch LTE.
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