U.S. Cellular Seeks Stimulus Grants

The wireless operator has applied for $23.5 million in federal stimulus dollars to expand 3G mobile broadband in rural areas.
U.S. Cellular applied for about $23.5 million in grants from the federal broadband stimulus package to provide wireless broadband to rural areas of California, Kansas, Missouri, and Nebraska.

The company said the grants will enable it to build out 3G networks that will create jobs, as well as help bridge the digital divide. U.S. Cellular joins the likes of Leap Wireless and Level 3 Communications as smaller service providers looking for federal dollars for mobile broadband networks.

"If provided with funding, we stand ready with shovels in-hand and are prepared to complete these mobile broadband projects within one year," said John Rooney, president and CEO of U.S. Cellular, in a statement. "It is an aggressive plan that will provide jobs, spur economic growth, and enhance public safety for rural, underserved, and vulnerable Americans."

As part of the American Recovery and Reinvestment Act of 2009, the federal government will be doling out roughly $7.2 billion in stimulus dollars earmarked for broadband access. The government has been inundated with requests for loans and grants totaling more than $28 billion, and the first round of grants will be awarded later this month. The first round will total about $4.7 billion, and the rest of the funds will be allocated by September 2010.

The major service providers like AT&T, Verizon, and Comcast are not expected to go after these stimulus dollars because of certain requirements attached to the funds. For instance, the first round of grants is aimed at bringing broadband to underserved, rural areas, and these are often not very profitable for carriers. For instance, Verizon has been shedding some of its rural customers in Hawaii and northern New England.

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