Serving rural customers in underserved areas moved the deal forward. Will service continue?
The U.S. wireless market consolidated a bit more on Aug. 1 when T-Mobile US, Inc. completed its acquisition of UScellular’s wireless operations. The deal went through after receiving antitrust clearance from the Department of Justice (DOJ) and the Federal Communications Commission (FCC).
The transaction was valued at $4.4 billion – $2.4 billion in cash plus $2 billion in assumed debt. The package includes more than 4 million UScellular customers, UScellular’s retail stores, and 30% of its spectrum assets, i.e., licenses or rights to specific portions of the radio frequency spectrum which are essential for transmitting voice, data, and internet signals over the air. The remainder of UScellular has rebranded as Array Digital Infrastructure, Inc., retaining ownership of 4,400 wireless towers and 70% of its spectrum portfolio not included in the T-Mobile deal. (Sources: Cord Cutters News, RCR Wireless, and T-Mobile.)
Assistant Attorney General Gail Slater, head of the DOJ Antitrust Division, acknowledged that the merger had raised concerns about competition in mobile wireless services and spectrum consolidation. However, the agency ultimately declined to seek an injunction, citing structural limitations that hindered UScellular’s ability to compete long-term.
“UScellular met the needs of ‘Heartland Families’ and ‘Farmtown Frugals’ by building networks and pricing plans that the Big 3 often did not offer,” said Slater. “The Department considered the impact of the potential disappearance of the services offered to those customers… that chose UScellular over T-Mobile or its national competitors.” The DOJ concluded that UScellular’s small regional customer base and capital constraints made it unlikely to remain a viable competitor without the merger.
The FCC agreed that the transaction would result in “substantial public interest benefits,” especially in rural areas.
What They Are Saying
The companies’ respective CEOs were unsurprisingly enthusiastic about the deal, saying millions of customers would see immediate service improvements.
Economist Eric Fruits of the International Center for Law & Economics agreed that the deal is a positive one, saying, “UScellular provides no meaningful competitive constraints on T-Mobile… The transaction presents an opportunity to address the structural challenges of a struggling regional carrier, while boosting competition and innovation across the wireless industry.”
Sen. Elizabeth Warren and her senatorial colleagues were less optimistic. In a letter to the DOJ and FCC, they warned that the transaction would “further consolidate an already highly concentrated market, reducing competition and potentially leading to higher prices and fewer choices for consumers.”
While UScellular only held about 1% of U.S. wireless connections, its presence in rural markets made it an important player in these underserved areas.
Top Wireless Competitors in Rural Areas
Here is a high-level look at the providers in the less populated parts of the country.
Verizon
- Strong rural presence through 5G Home Internet and fixed wireless access (FWA).
- Known for robust coverage and reliability in less populated areas.
- Competes aggressively with bundled mobile + broadband packages.
- Source: CoBank
AT&T
- Offers fixed wireless and mobile services in rural regions.
- Partnered with local cooperatives and MVNOs to expand reach.
- Also supports rural broadband through fiber and wireless initiatives.
- Source: CoBank
Starlink (SpaceX)
- Satellite-based internet service with nationwide rural coverage.
- Popular in remote areas with no fiber or cable infrastructure.
- Not a traditional mobile carrier, but competes in the broadband space.
- Source: The ISP Info
Local & Regional Providers
- Examples: Mediacom, Midco, WOW!, and National Content & Technology Cooperative (NCTC).
- Many are launching mobile services via MVNO agreements (e.g., with AT&T).
- These providers are vital in underserved rural markets.
- Source: CoBank
Nomad Internet & Other MVNOs
- Target RV users, nomads, and rural dwellers with portable wireless solutions.
- Use existing networks (e.g., Verizon, AT&T) to offer flexible plans.
- Source: The ISP Info
T-Mobile (Pre-Merger)
- Expanded rural reach through 5G Home Internet and aggressive pricing.
- The merger with UScellular could significantly boost rural spectrum and tower access.
- Source: The ISP Info
Conclusion
The big question is whether T-Mobile will maintain focus on underserved regions of the country – an important factor in the government’s approval – or consolidate operations to serve its bottom line, as is common post-acquisition, and leave gaps in rural America.
Edited by Tom Hagy for Mogin Law LLP.
