Rural Cellular Corp. said it is acquiring PCS spectrum from AT&T Wireless Services Inc. and one of its affiliates covering 1.9 million potential customers in Rural Cellular’s Northeast region and 200,000 pops in the carrier’s Northwest region.
In connection with the purchase, Rural Cellular said it plans to overlay a “substantial” number of its cell sites with GSM/GPRS technology and entered national GSM/GPRS roaming agreements with Cingular Wireless L.L.C. effective June 2003 through Dec. 2007 and with AT&T Wireless effective June 2003 through June 2006.
Rural Cellular also said it plans to overlay its Midwest region with CDMA technology in anticipation of roaming traffic and is evaluating options in its remaining legacy TDMA markets, noting it was likely that both CDMA and GSM/GPRS technologies may be deployed depending on market conditions.
“This network upgrade is good for RCC as it positions us for sustained roaming revenue from our national partners,” said Richard Ekstrand, president and chief executive officer of Rural Cellular. “We view these agreements as a vote of confidence in the strength of our existing networks and our network operations team who are taking on the task of overlaying multiple technologies.”
The carrier said that it was in the final stages of selecting infrastructure suppliers and expects GSM/GPRS and CDMA construction to begin during the third quarter of this year and to be completed by 2005, and noted it expects to meet the cash needs relating to the network upgrades through its cash flow from operations, cash on hand and borrowing under its credit facility.
Rural wireless operator Western Wireless Corp. announced similar overlay plans for its legacy TDMA network, noting it currently offers CDMA in more than half of its coverage area and plans to install GSM/GPRS in at least half of its cell sites to facilitate roaming agreements with AT&T Wireless, Cingular and T-Mobile USA Inc.
Rural Cellular also reported it recently received Eligible Telecommunications Carrier Status in Maine, Minnesota and Vermont, making the carrier eligible for federal Universal Service Fund support for serving low income customers and customers living in high-cost areas. Rural currently receives USF support in Alabama, Mississippi and Washington and has filed additional ETC applications in Kansas and Oregon.
