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AT&T Wireless, U.S. Cellular talk swap

The two wireless carriers cut a deal that has AT&T handing over millions in cash, along with excess spectrum in 13 states, for U.S. Cellular's operations in Florida and Georgia.

AT&T Wireless said Monday that it is handing over $31 million in cash, along with surplus wireless spectrum in 13 states, for U.S. Cellular's operations in northern Florida and southern Georgia.

The Florida operations comprise cell phone networks and retail outlets in major markets including Tallahassee and Gainesville, said AT&T Wireless representative Mike DiGioia.

The surplus spectrum--radio frequencies over which cell phone calls travel--is in midwest and northeast states.

Such deals are a common way for carriers to enter new markets. Keith Waryas, an analyst with IDC, expects the pace of such cash and spectrum swaps to quicken in 2003 as the nation's top six carriers continue fighting for market share.

AT&T Wireless is the nation's second-largest carrier, with 22.8 million subscribers. The nation's largest wireless carrier is Verizon Wireless, which has 32.5 million customers. U.S. Cellular, based in Chicago, is the nation's eight-largest carrier, with 4.1 million customers.

The deal affects about 141,000 U.S. Cellular customers. Sometime this summer, when terms are finalized, U.S. Cellular customers in the two southern states can become AT&T Wireless subscribers or choose another carrier, DiGioia said.