United States Cellular Corporation

Increasing Smartphone Sales and Data Use

As customer demand for smartphones and data services continues to rise, U.S. Cellular is increasing smartphone penetration by offering a competitive range of Android^®-, Windows Mobile^®- and BlackBerry^®-based devices, including smartphones, tablets and modems, at a variety of price points.

At the end of 2011, smartphone customers were 30 percent of our postpaid base, compared to 17 percent at the end of 2010. And smartphones were
52 percent of total devices sold in the fourth quarter of 2011, and 44 percent of devices sold in the year. This drove corresponding growth in data use—and in adoption of higher-revenue data plans—which, along with data roaming revenues, led to higher average revenue per customer. Despite the sharp increase in smartphones sold, U.S. Cellular effectively managed subsidies through a balanced mix of lower- and higher-cost devices.

As the industry moved toward tiered data pricing, we prepared to introduce our own tiered plans in 2012, including entry-level plans to encourage customers to upgrade to their first smartphones.