U.S. Cellular rejected Apple and the iPhone 4S

November 4, 2011 By Mike Flacy

While Sprint, Verizon and AT&T are reporting record sales of the new iPhone 4S, the sixth largest cellular company in the United States decided to go down a different path.

Reported in a third quarter earnings call this week, U.S. Cellular CEO Mary Dillon told investors that the company turned down Apple when approached in regards to offering models of the iPhone to U.S. Cellular customers. While Dillon indicated that the U.S. Cellular network was definitely capable of handling the expanded traffic from sales of a new iPhone, Apple’s offer was rejected due to terms that were “unacceptable from a risk and profitability standpoint.” This indicates that Apple may have wanted a large order placed as well as an upfront payment from the cellular company. Apple may have also stipulated a set of conditions around distribution and in-store placement of the iPhones that was unacceptable to U.S. Cellular.

While U.S. Cellular currently has about six million customers without access to the iPhone, the company certainly isn’t the largest cellular provider without Apple’s popular device. The 34 million subscribers at T-Mobile also don’t have access yet, specifically because Apple hasn’t developed a version of the phone that’s compatible with T-Mobile’s service. While T-Mobile phones certainly operate at 3G and 4G speeds, the 3G service operates on the AWS frequency band which is incompatible with various models of the iPhone. Apple did sign a new agreement with regional cellular provider C Spire which provides approximately 900,000 subscribers with access to the iPhone 4 and 4S starting next Friday.

In addition to the news about the rejection of Apple’s offer, Dillon mentioned that the launch of the LTE network was being delayed until early 2012. Previously, the company had planned to offer LTE access during the fourth quarter of 2011. The initial launch of the LTE network will take place in states such as North Carolina, Iowa, Oklahoma, Maine, North Carolina, Texas and Wisconsin. Plans regarding the launch in additional markets will be announced throughout the year.

Showing 10 comments

BG at 5:44pm 6th November 2011 Oh, what a great idea. While the other largest carriers are raking in billions per quarter, US Cellular stock is trading at a 5 year low while their customers are kept from the most successful and innovative phone in the history of the world while Mary Dillon thinks it's best to tell Apple that their business model is too expensive. It's called making an investment to get a return. I guess she thinks she will get a better return from the Motorola Razr.
Josh Smith at 4:44pm 5th November 2011 Anyways Apple products are like heroin for people. They have to have the newest, and bestest products out there. They are willing to drop $750-$1000 for a brand new phone ever 6 months to a year when they release them. The sad part of it there isn't really and upgrades to the overall phone from the 4 to the 4S. Oooooh it has an 8mpx camera. The 5mpx camera on my iPhone 4 does a fantastic job. If you want a fancy camera buy a damn DSLR camera. I think after my contract is up I am going to switch back to Android.
Josh Smith at 4:41pm 5th November 2011 Because in the US we're all about "competition", and the best way to compete with your rivals is to do crap like that. Then sit there, and say it promotes industry growth.
Gareth Dix at 10:01am 5th November 2011 Why is every network in the US using a different frequency? All the networks in the uk have the iPhone because it's a set standard
Reangelo Jarvis at 4:56am 5th November 2011 thats just some bs
Robin Otaegui at 4:40am 5th November 2011 ^ lol what are you talking about..
Richard Wills at 4:22am 5th November 2011 good for them,if more companies reject apple maybe we can get rid of apple products and the company will go under. apple products are crap...
Lucas Meyer at 4:16am 5th November 2011 Obviously don't want bullshit phones either
Robin Otaegui at 4:15am 5th November 2011 lol its a bullshit carrier anyways.
Matthew Speer at 4:14am 5th November 2011 Smart move.....