Telephone and Data Systems, Inc. (TDS) provides communications services to customers, including retail wireless connections, as well as broadband, video, and voice connections.
The company serves customers with 4.4 million retail wireless connections and 1.1 million broadband, video, and voice connections as of December 31, 2024. The company conducts wireless operations through its majority-owned subsidiary, the United States Cellular Corporation (UScellular). The company provides broadband, vi...
Telephone and Data Systems, Inc. (TDS) provides communications services to customers, including retail wireless connections, as well as broadband, video, and voice connections.
The company serves customers with 4.4 million retail wireless connections and 1.1 million broadband, video, and voice connections as of December 31, 2024. The company conducts wireless operations through its majority-owned subsidiary, the United States Cellular Corporation (UScellular). The company provides broadband, video, voice, and wireless services through its wholly-owned subsidiary TDS Telecommunications LLC (TDS Telecom).
Segments
The company has three reportable segments: UScellular Wireless, UScellular Towers, and TDS Telecom. The company's operations also include the operations of its wholly-owned subsidiary Suttle-Straus, Inc. (Suttle-Straus).
UScellular Operations
UScellular provides wireless telecommunications services to customers with 4.4 million retail connections in portions of multiple states, collectively representing a total population of 33 million. UScellular operates in two reportable segments – Wireless and Towers. All of its wireless operating markets are in the United States.
Operating Strategy and Community Focus
UScellular’s strategy is to attract and retain customers by providing a network, outstanding customer service, and competitive devices, plans, and pricing, all provided with a community focus.
UScellular operates a regional wireless network. UScellular’s interests in wireless spectrum licenses include both direct interests whereby UScellular is the licensee and investment interests in entities that are licensees; together, these direct and investment interests involve operating and non-operating wireless spectrum licenses covering portions of multiple states and a total population of approximately 51 million as of December 31, 2024.
UScellular has a longstanding commitment to supporting its local communities through donations and volunteerism. UScellular focuses its Corporate Social Responsibility program on addressing gaps in STEM (Science, Technology, Engineering, and Math) education and connecting tomorrow’s innovators with the resources they need today to help shape their future opportunities. UScellular serves its local communities through exclusive partnerships with acclaimed national nonprofit partners. In 2024, UScellular continued exploring ways to leverage its assets, brand, partnerships, and resources to close the digital divide, with a focus on helping to ensure youth in its markets have reliable and fast internet access in school and at home through the After School Access Project. In addition, UScellular continues to participate in the TDS Environmental, Social, and Governance (ESG) program.
Customers, Services, Products, and Seasonality
Customers: UScellular focuses on consumer, business, and government customers located in its operating markets. These customers are served primarily through UScellular’s retail stores and digital platform, as well as its direct and indirect sales channels.
Services: UScellular provides a wide variety of wireless services accessible on a broad range of devices. A postpaid connection represents an individual line of service for a device for which a customer is generally billed one month in advance for a monthly access charge in return for access to and usage of network services. UScellular’s prepaid service enables individuals to obtain services without credit verification by paying for all services in advance. Approximately 90% of retail connections were postpaid connections as of December 31, 2024.
UScellular offers various service plans with nationwide coverage tailored to the needs of customers. Depending on those needs, service plans may include features related to, among other items: unlimited or metered voice and data; high-definition video features; the ability to use a device as a Wi-Fi hotspot; international voice, text, and data; and varying data rates depending on the plan and usage on that plan. Service offerings vary from time to time based on customer needs, technology changes, and market conditions.
UScellular offers home and business internet throughout the footprint via fixed wireless access. Options include an in-home self-installed device and a self-installation device mounted on the external side of a window.
UScellular offers advanced wireless solutions to consumers and business and government customers, including an expansive suite of connected Internet of Things (IoT) solutions and software applications across the categories of monitor and control (e.g., sensors and cameras), business automation/operations (e.g., e-forms, office solutions), communication (e.g., enterprise messaging, unified communications, primary and backup internet connectivity for business continuity), fleet/asset/video management solutions, security solutions, private cellular networks (PCN), and custom and bespoke end-to-end IoT solutions, et al. The business organization also offers an extensive selection of professional and managed services, including staff augmentation, IPX services, and SIM management. Lastly, for first responders, UScellular offers a suite of critical connectivity solutions that includes Wireless Priority Services (WPS) and Quality Priority and Preemption (QPP) options.
Products: UScellular offers a comprehensive range of devices, such as smartphones and other handsets, tablets, wearables, mobile hotspots, fixed wireless home internet, and IoT devices. In addition, UScellular also offers a wide range of accessories, including wireless essentials, such as cases, screen protectors, cables, chargers, memory cards, and consumer electronics, such as Bluetooth audio, Wi-Fi-enabled cameras, and networking products. UScellular allows customers to purchase certain devices and accessories on installment plans, allowing for customers to pay over a specified period of time.
UScellular also offers services that enable customers to replace or repair their devices, including the Device Protection+ program, which provides as soon as next-day delivery of a replacement device for damaged, lost, and stolen devices, and AppleCare services for Apple iOS customers. UScellular's Device Protection+ Advanced program also includes local or on-demand repair for eligible devices. In addition, UScellular offers a Trade-In program through which UScellular acquires customers' used equipment in exchange for promotional or bill credit.
UScellular purchases devices and accessory products from a number of original equipment manufacturers and distributors. UScellular manages relationships with its suppliers to ensure its customers have access to the industry's latest devices, to obtain the best possible pricing, and to identify opportunities for promotional support from its suppliers. UScellular contracts with third-party providers for its product warehousing, distribution, and direct customer fulfillment activities. UScellular also contracts with third-party providers for its device service programs.
Seasonality: UScellular’s operating expenses tend to be higher in the fourth quarter (year ended December 31, 2024) due to increased marketing and promotional activities during the holiday season.
Sales and Distribution Channels
UScellular supports a multi-faceted distribution program, including retail sales, direct sales, telesales, e-commerce, and indirect sales, including resellers, independent agents, and a third-party national retailer.
The company retail store locations are designed to market wireless services and products to the consumer and small business segments in a setting familiar to these types of customers. Direct sales representatives and the indirect channel sell traditional wireless services, as well as IoT and other specialized products and solutions to medium and businesses and governmental entities. Additionally, the telesales and e-commerce channels enable customers to purchase services and devices via phone and online, respectively.
UScellular has relationships with exclusive and non-exclusive agents (collectively “agents”), which are independent businesses that obtain and service customers for UScellular on a commission basis. UScellular’s agents are generally in the business of selling wireless devices, wireless service plans, and other related products to consumer and business and government customers. UScellular provides support and training to its agents to increase customer satisfaction and to ensure a consistent customer experience.
UScellular also maintains a relationship with a national retailer, selling postpaid and prepaid devices, and similar to the agents, this national retailer obtains and services UScellular postpaid and prepaid customers on a commission basis.
Competition
UScellular competes directly with several wireless service providers in each of its markets. In general, there are at least four competitors across UScellular's service area, including to a varying degree: the national wireless companies - Verizon Communications Inc., AT&T Inc., T-Mobile US, Inc., and Dish Network Corporation, cable wireless, which predominantly includes Comcast Corporation and Charter Communications, Inc., and mobile virtual network operators (MVNOs).
Network
Network Technology: Wireless telecommunication systems transmit voice and data signals over networks of radio towers using radio spectrum licensed by the FCC. Access to local, regional, national, and worldwide telecommunications networks is provided through system interconnections. A high-quality network, supported by continued investments in that network, is an important factor for UScellular to remain competitive.
5G technology helps address customers’ growing demand for data services and enhanced services, including high-speed fixed wireless home internet services, requiring high speed and reliability, as well as low latency. UScellular supports mobility and fixed wireless services through a combination of low-band, mid-band, and high-band spectrum. In 2019-2023, UScellular focused on 5G coverage and predominantly used low-band spectrum to launch 5G services in portions of substantially all of its markets. During 2023 and 2024, UScellular has focused on deploying 5G over its mid-band spectrum, largely overlapping areas already covered with low-band 5G service to enhance speed and capacity for UScellular's mobility and fixed wireless services. As of December 31, 2024, mid-band spectrum is deployed on sites that covered nearly 50% of data and voice traffic.
UScellular also operates a 4G LTE network, including VoLTE technology, which allows customers to utilize a 4G LTE-enabled mobile device for voice and data services, including high-definition voice and simultaneous voice and data sessions.
UScellular decommissioned its third-generation (3G) CDMA network in the first quarter of 2024.
Roaming: Inter-carrier roaming agreements are negotiated between wireless operators to enable customers to use wireless services outside of their home service area. UScellular has entered into roaming agreements with a number of wireless companies so that it can offer its customers nationwide services, including 4G LTE, VoLTE, and 5G, as well as a variety of international roaming options.
Towers: UScellular owns and leases cell towers to provide service to its customers throughout its footprint. UScellular receives tower rental revenues when another carrier leases tower space on a UScellular-owned tower. As of December 31, 2024, there were thousands of cell sites in service, of which UScellular owned some.
TDS Telecom Operations
TDS Telecom provides communications services to 1.1 million connections in multiple states through its high-quality fiber, coaxial, and copper networks. TDS Telecom operates in one reportable segment, and its operating markets are located in a mix of small to mid-sized urban, suburban, and rural communities throughout the United States.
Operating Strategy and Community Focus
TDS Telecom invests in networks, services, and products, with the constant focus on delivering outstanding customer service. Through its investments, TDS Telecom intends to improve its broadband services and extend its footprint. TDS Telecom intends to augment that broadband growth by bundling with video, voice, wireless, and other value-added services. TDS Telecom seeks to be the preferred broadband provider by offering fiber-rich networks, high-quality products and services, and a seamless customer experience.
A key strategic initiative for TDS Telecom is investing in fiber to provide broadband speeds of up to 8 Gigabits per second (Gbps). Fiber builds allow TDS Telecom to deliver more robust residential and commercial products in its markets that have historically utilized copper technologies and to target attractive, growing markets to increase its total footprint. In 2024, TDS Telecom continued to expand its footprint through fiber investments in Wisconsin and the Pacific Northwest. To optimize its portfolio, the company is exploring opportunities to divest certain markets.
TDS Telecom is committed to growing with its communities and meeting the needs of customers through great products and services, sponsorships, fundraising, and volunteering. TDS Telecom serves its local communities by financially supporting local projects to serve those in need and by providing TDS Telecom associates with paid time off each year to volunteer.
Technology
TDS Telecom continues to upgrade and enhance its networks by utilizing various technologies to improve levels of performance and provide additional speed and security to increase value for its customers. The TDS network consists of a highly reliable IP-based broadband network to facilitate the integration of broadband, video, and voice services.
In order to provide IP-based services, TDS Telecom has developed and deployed an inter-regional data routing infrastructure using owned and leased fiber capacity, which allows it to leverage its 400-gigabit core network. This configuration, along with the continued development of an IP network that interconnects substantially all the existing service territories, provides redundancy and allows for next-generation IP service offerings.
TDS Telecom utilizes centralized monitoring and management of its core network to reduce costs and improve service reliability. TDS Telecom continues to standardize equipment and processes to increase efficiency in maintaining its network. Network standardization has aided TDS Telecom in operating its 24-hours-a-day/7-days-per-week Network Management Centers, which continuously monitor the network to proactively identify, minimize, and correct network faults prior to any customer impact.
Customers, Services, and Products
Residential: TDS Telecom residential customer operations provide high-speed broadband, video, voice, and wireless services. These services are bundled at competitive prices to encourage cross-selling within the customer base and to attract and retain customers.
Broadband: TDS Telecom offers reliable high-speed internet connections and whole-home Wi-Fi through fiber-rich networks. In certain non-fiber markets, TDS Telecom has deployed fiber-to-the-node and copper-based vectoring/pair bonding technology to increase data speeds reaching up to 100 Mbps. DOCSIS 3.1 technology is utilized across nearly all cable markets and offers speeds of up to 1 Gbps. Whole-home Wi-Fi, security, and support services are available to enhance customers’ high-speed internet experience.
Video: TDS Telecom provides advanced home TV entertainment combined with a digital video recording (DVR) service. TDS Telecom offers TDS TV+, an integrated cloud TV platform that combines linear and on-demand programming, mobile device interfaces, personalized recommendations, and network-based DVR. In certain markets, TDS Telecom partners with a satellite TV provider to offer digital television. TDS video connections are declining due to rising prices and the industry-wide trend toward cord-cutting.
Voice: Call plans include local and long-distance telephone service, Voice over Internet Protocol (VoIP), and enhanced services like Find-Me/Follow-Me, collaboration, instant messaging, and more. Many features are bundled with calling plans to give customers the best value. Voice offerings continue to be impacted by the industry-wide decline in access lines.
Wireless: TDS introduced MVNO plans offering wireless services to customers in certain service areas. TDS’ MVNO offerings are reliant on third parties to deliver wireless service to these customers. TDS currently offers By-the-Gig and Unlimited data plans.
Commercial: TDS Telecom commercial customer operations provide secure and reliable broadband, IP-based services, and hosted voice and video collaboration services to small- and medium-sized businesses. TDS Telecom's commercial service focus is to lead with broadband bundled with a voice product and video solution.
Wholesale: TDS Telecom’s wholesale operations include carrying data and voice traffic on TDS Telecom's networks from other interexchange carriers. Federal Connect America Fund (CAF), including ACAM, E-ACAM, and state Universal Service Fund (USF) revenues, which support the cost of providing communication services in underserved high-cost areas, are also included in wholesale service revenues.
Marketing, Sales, and Distribution Channels, and Customer Service
Marketing: TDS Telecom’s marketing plan is focused on acquiring, retaining, and growing customer relationships by maintaining a high-quality network, providing outstanding customer service, and offering a comprehensive portfolio of services and products built around customer needs with a local focus. TDS Telecom uses door-to-door selling, digital marketing, targeted mailings, and mass advertising to market services and products. TDS Telecom differentiates itself from competitors using a hyper-localized and community-based sales and marketing effort to maximize broadband penetration.
Sales and Distribution Channels: TDS Telecom operates and uses sales contact centers, direct sales forces, including third-party direct sales, retail stores, sales agents, and an online platform to sell services and products.
Customer Service: TDS Telecom manages customer retention by focusing on outstanding customer service through extensive training of front-line sales and support associates.
Regulation
The FCC generally exercises jurisdiction over all facilities of, and services offered by, TDS Telecom’s Incumbent Local Exchange Carriers (ILEC) as telecommunications common carriers, to the extent they provide, originate, or terminate interstate or international telecommunications.
History
Telephone and Data Systems, Inc. was incorporated in 1968.
