Telephone and Data Systems (TDS) 10-Q 5 May 17 2017 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information	3 Months Ended
	Mar. 31, 2017shares
Entity Registrant Name	TELEPHONE & DATA SYSTEMS INC /DE/
Entity Central Index Key	1,051,512
Document Type	10-Q
Document Period End Date	Mar. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Trading Symbol	TDS
Common Shares
Entity Common Stock, Shares Outstanding	103,076,101
Series A Common Shares
Entity Common Stock, Shares Outstanding	7,236,725

Consolidated Statement Of Opera

Consolidated Statement Of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Operating revenues
Service	$ 997	$ 1,011
Equipment and product sales	241	243
Total operating revenues	1,238	1,254
Operating expenses
Cost of services (excluding Depreciation, amortization and accretion reported below)	282	288
Cost of equipment and products	270	291
Selling, general and administrative	406	431
Depreciation, amortization and accretion	211	212
(Gain) loss on asset disposals, net	4	6
(Gain) loss on license sales and exchanges, net	(17)
Total operating expenses	1,156	1,228
Operating income	82	26
Investment and other income (expense)
Equity in earnings of unconsolidated entities	32	35
Interest and dividend income	4	3
Interest expense	(42)	(41)
Other, net	1
Total investment and other income (expense)	(5)	(3)
Income before income taxes	77	23
Income tax expense	34	13
Net income	43	10
Less: Net income attributable to noncontrolling interests, net of tax	6	2
Net income attributable to TDS shareholders	37	8
Net income available to TDS common shareholders	$ 37	$ 8
Basic weighted average shares outstanding	110	109
Basic earnings per share available to TDS common shareholders	$ 0.34	$ 0.07
Diluted weighted average shares outstanding	112	110
Diluted earnings per share available to TDS common shareholders	$ 0.33	$ 0.07
Dividends per share to TDS shareholders	$ 0.155	$ 0.148

Consolidated Statement Of Compr

Consolidated Statement Of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 43	$ 10
Change related to retirement plan
Amortization of prior service cost	(1)
Comprehensive income	42	10
Less: Net income attributable to noncontrolling interests, net of tax	6	2
Comprehensive income attributable to TDS shareholders	$ 36	$ 8

Consolidated Statement Of Cash

Consolidated Statement Of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Cash flows from operating activities
Net income	$ 43	$ 10
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
Depreciation, amortization and accretion	211	212
Bad debts expense	24	19
Stock-based compensation expense	11	9
Deferred income taxes, net	(1)	5
Equity in earnings of unconsolidated entities	(32)	(35)
Distributions from unconsolidated entities	11	14
(Gain) loss on asset disposals, net	4	6
(Gain) loss on license sales and exchanges, net	(17)
Noncash interest expense	1	1
Changes in assets and liabilities from operations
Accounts receivable	28	20
Equipment installment plans receivable	(44)	(41)
Inventory		(1)
Accounts payable	(75)	39
Customer deposits and deferred revenues	(12)	(6)
Accrued taxes	33	63
Accrued interest	9	9
Other assets and liabilities	(57)	(78)
Net cash provided by operating activities	137	246
Cash flows from investing activities
Cash paid for additions to property, plant and equipment	(127)	(159)
Cash paid for acquisitions and licenses	(14)
Cash received from divestitures and exchanges	16	2
Net cash used in investing activities	(125)	(157)
Cash flows from financing activities
Repayment of long-term debt	(3)	(3)
TDS Common Shares reissued for benefit plans, net of tax payments	1
U.S. Cellular Common Shares reissued for benefit plans, net of tax payments	3	1
Repurchase of TDS Common Shares		(3)
Repurchase of U.S. Cellular Common Shares		(2)
Dividends paid to TDS shareholders	(17)	(16)
Other financing activities		3
Net cash used in financing activities	(16)	(20)
Net increase (decrease) in cash and cash equivalents	(4)	69
Cash and cash equivalents
Beginning of period	900	985
End of period	$ 896	$ 1,054

Consolidated Balance Sheet

Consolidated Balance Sheet - USD ($) $ in Millions		Mar. 31, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents		$ 896	$ 900
Accounts receivable
Due from customers and agents, less allowances of $57 and $55, respectively		739	753
Other, less allowances of $1 and $2, respectively		90	98
Inventory, net		151	151
Prepaid expenses		116	115
Income taxes receivable		3	10
Other current assets		30	32
Total current assets		2,025	2,059
Assets held for sale		5	8
Licenses		1,904	1,895
Goodwill		770	766
Franchise rights		244	244
Other intangible assets, net of accumulated amortization of $156 and $153, respectively		31	33
Investments in unconsolidated entities		472	451
Other investments			1
Property, plant and equipment
In service and under construction		11,729	11,679
Less: Accumulated depreciation and amortization		8,280	8,124
Property, plant and equipment, net		3,449	3,555
Other assets and deferred charges		449	434
Total assets	[1]	9,349	9,446
Current liabilities
Current portion of long-term debt		12	12
Accounts payable		260	365
Customer deposits and deferred revenues		217	229
Accrued interest		20	11
Accrued taxes		67	44
Accrued compensation		77	127
Other current liabilities		85	99
Total current liabilities		738	887
Deferred liabilities and credits
Deferred income tax liability, net		921	922
Other deferred liabilities and credits		467	453
Long-term debt, net		2,431	2,433
Commitments and contingencies
Noncontrolling interests with redemption features		1	1
TDS shareholders' equity
Series A Common and Common Shares Authorized 290 shares (25 Series A Common and 265 Common Shares) Issued 133 shares (7 Series A Common and 126 Common Shares) Outstanding 110 shares (7 Series A Common and 103 Common Shares) Par Value ($.01 per share)		1	1
Capital in excess of par value		2,394	2,386
Treasury shares, at cost, 23 Common Shares		(693)	(698)
Accumulated other comprehensive income			1
Retained earnings		2,473	2,454
Total TDS shareholders' equity		4,175	4,144
Preferred shares		1	1
Noncontrolling interests		615	605
Total equity		4,791	4,750
Total liabilities and equity	[1]	$ 9,349	$ 9,446
[1]	The consolidated total assets as of March 31, 2017 and December 31, 2016 include assets held by consolidated VIEs of $763 million and $804 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2017 and December 31, 2016 include certain liabilities of consolidated VIEs of $15 million and $17 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 8 — Variable Interest Entities for additional information.

Consolidated Balance Sheet Pare

Consolidated Balance Sheet Parenthetical - USD ($) shares in Millions, $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Current assets
Customer and agent allowances	$ 57	$ 55
Other allowances	1	2
Other intangible assets
Other intangible assets accumulated amortization	$ 156	$ 153
TDS shareholders' equity
Authorized shares	290	290
Issued shares	133	133
Outstanding shares	110	110
Variable Interest Entities VIEs
Total VIE assets that can be used to settle only the VIEs' obligations	$ 763	$ 804
Total VIE liabilities for which creditors have no recourse	$ 15	$ 17
Series A Common Shares
TDS shareholders' equity
Authorized shares	25	25
Issued shares	7	7
Outstanding shares	7	7
Par value per share	$ 0.01	$ 0.01
Common Shares
TDS shareholders' equity
Authorized shares	265	265
Issued shares	126	126
Outstanding shares	103	103
Par value per share	$ 0.01	$ 0.01
Treasury shares at cost	23	23

Consolidated Statement of Chang

Consolidated Statement of Changes in Equity - USD ($) $ in Millions	Total	Series A Common and Common shares	Capital in excess of par value	Treasury shares	Accumulated other comprehensive income (loss)	Retained earnings	Total TDS shareholders' equity	Preferred shares	Noncontrolling interests
Beginning balance at Dec. 31, 2015	$ 4,704	$ 1	$ 2,365	$ (727)		$ 2,487	$ 4,126	$ 1	$ 577
Net income attributable to TDS shareholders	8					8	8
Net income attributable to noncontrolling interests classified as equity	1								1
TDS Common and Series A Common share dividends	(16)					(16)	(16)
Repurchase of Common shares	(3)			(3)			(3)
Dividend reinvestment plan	3		1	2			3
Incentive and compensation plans	1		(1)	2			1
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans	5		2				2		3
Stock-based compensation awards	4		4				4
Tax windfall (shortfall) from stock awards	1		1				1
Ending balance at Mar. 31, 2016	4,708	1	2,372	(726)		2,479	4,126	1	581
Beginning balance at Dec. 31, 2016	4,750	1	2,386	(698)	$ 1	2,454	4,144	1	605
Net income attributable to TDS shareholders	37					37	37
Net income attributable to noncontrolling interests classified as equity	6								6
Other comprehensive income	(1)				$ (1)		(1)
TDS Common and Series A Common share dividends	(17)					(17)	(17)
Dividend reinvestment plan	3			3			3
Incentive and compensation plans	1			2		(1)	1
Adjust investment in subsidiaries for repurchases, issuances and other compensation plans	8		4				4		4
Stock-based compensation awards	4		4				4
Ending balance at Mar. 31, 2017	$ 4,791	$ 1	$ 2,394	$ (693)		$ 2,473	$ 4,175	$ 1	$ 615

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 31, 2017
Basis of Presentation [Abstract]
Basis of Presentation	Note 1 Basis of Presentation The accounting policies of Telephone and Data Systems, Inc. (“TDS”) conform to accounting principles generally accepted in the United States of America (“GAAP”) as set forth in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 83% -owned wireless telephone subsidiary, United States Cellular Corporation (“U.S. Cellular”) and TDS’ wholly-owned subsidiary, TDS Telecommunications Corporation (“TDS Telecom”). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that require consolidation under GAAP. All material intercompany accounts and transactions have been eliminated. The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Calculated amounts and percentages are based on the underlying actual numbers rather than the numbers rounded to millions as presented. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (“Form 10-K”) for the year ended December 31, 2016 . TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended March 31, 2017 , are U.S. Cellular, Wireline, Cable, and Hosted and Managed Services (“HMS”) operations. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned subsidiary Suttle-Straus, Inc. (“Suttle-Straus”). Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States, except for HMS, which includes an insignificant foreign operation. See Note 10 — Business Segment Information for summary financial information on each business segment. The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of March 31, 2017 and December 31, 2016 , its results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2017 and 2016 . These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2016 , except as described below. Equipment Installment Plans TDS equipment revenue under equipment installment plan contracts is recognized at the time the device is delivered to the end-user customer for the selling price of the device, net of any deferred imputed interest or trade-in right, if applicable. Imputed interest is reflected as a reduction to the receivable balance and recognized over the duration of the plan as Service revenues. See Note 3 — Equipment Installment Plans . Effective January 1, 2017, TDS elected to change the classification of interest income on equipment installment plan contracts from Interest and dividend income to Service revenues in the Consolidated Statement of Operations. TDS believes this classification is preferable because financing of devices as part of enrolling customers for service is an activity that is central to TDS’ operations, and it is consistent with the presentation by others in the industry. Comparative financial statements of prior years have been adjusted to apply the new classification retrospectively. As a result of this change in classification, Service revenues for the three months ended March 31, 2016, increased by $11 million from previously reported amounts, with a corresponding decrease in Interest and dividend income. In comparison, Service revenues for the three months ended March 31, 2017 , include $ 16 million of equipment installment plan interest income, which would have been reported within Interest and dividend income had the change not been implemented. This change did not have an impact on Income before income taxes, Net income, or Earnings per share for the three months ended March 31, 2016, nor did it have a cumulative impact to Retained earnings as of any date presented. Recently Issued Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”) and has since amended the standard with Accounting Standards Update 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date , Accounting Standards Update 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , Accounting Standards Update 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , Accounting Standards Update 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , and Accounting Standards Update 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . These standards replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. TDS is required to adopt ASU 2014-09, as amended, on January 1, 2018. Early adoption as of January 1, 2017, is permitted; however, TDS did not adopt early. ASU 2014-09, as amended, impacts TDS’ revenue recognition related to the allocation of contract revenues between various services and equipment, and the timing of when those revenues are recognized. In addition, ASU 2014-09 requires deferral of incremental contract acquisition and fulfillment costs and subsequent expense recognition over the contract period or expected customer life. TDS has identified that new systems, processes and controls are required to adopt ASU 2014-09, as amended. TDS has substantially completed the design and development of new systems to perform revenue recognition accounting under the provisions of ASU 2014-09, as amended, and is currently engaged in the process of testing these new systems. TDS expects to transition to the new standard under the modified retrospective transition method whereby a cumulative effect adjustment to retained earnings is recognized upon adoption and the guidance is applied prospectively. Upon adoption, the cumulative effect adjustment is expected to include the establishment of contract asset and contract liability accounts with a corresponding adjustment to retained earnings to reflect the reallocation of revenues between service and equipment performance obligations for which control is transferred to customers in different periods. Reallocation impacts generally arise when bundle discounts are provided in a contract arrangement that includes equipment and service performance obligations. In these cases, the revenue will be reallocated according to the relative stand-alone selling prices of the performance obligations included in the bundle and this may be different than how the revenue is billed to the customer and recognized under current guidance. In addition, contract cost assets will be established to reflect costs that will be deferred as incremental contract acquisition and fulfillment costs. Incremental contract acquisition costs generally relate to commissions paid to sales associates while fulfillment costs are generally related to service installation costs on the wireline and cable businesses. TDS is evaluating the effects that adoption of ASU 2014-09, as amended, will have on its financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (“ASU 2016-02”). ASU 2016-02 requires lessees to record a right-of-use asset and lease liability for almost all leases. This ASU does not substantially impact lessor accounting. TDS is required to adopt ASU 2016-02 on January 1, 2019. Early adoption is permitted. Upon adoption of ASU 2016-02, TDS expects a substantial increase to assets and liabilities on its balance sheet. TDS is evaluating the effects that adoption of ASU 2016-02 will have on its financial position and results of operations. In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosure relating to the credit quality of trade and other receivables, including information relating to management’s estimate of credit allowances. TDS is required to adopt ASU 2016-13 on January 1, 2020. Early adoption as of January 1, 2019 is permitted. TDS is evaluating the effects that adoption of ASU 2016-13 will have on its financial position, results of operations and disclosures. In December 2016, the FASB issued Accounting Standards Update 2016-19 Technical Corrections and Improvements (“ASU 2016-19”). ASU 2016-19 includes an amendment to Accounting Standards Codification Subtopic 350-40, Intangibles – Goodwill and Other – Internal-Use Software, which clarifies a software license within the scope of the Subtopic will be accounted for as the acquisition of an intangible asset and the incurrence of a liability to the extent that the license fees are not fully paid at acquisition. TDS adopted this standard prospectively for all arrangements entered into or materially modified after January 1, 2017. In January 2017, the FASB issued Accounting Standards Update 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 eliminates Step 2 of the current goodwill impairment test. Goodwill impairment loss will be measured as the amount by which a reporting unit’s carrying amount exceeds its fair value. TDS is required to adopt ASU 2017-04 on January 1, 2020. Early adoption is permitted. TDS is assessing whether it will early adopt ASU 2017-04. In February 2017, the FASB issued Accounting Standards Update 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets: Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets (“ASU 2017-05”). ASU 2017-05 clarifies how entities account for the derecognition of a nonfinancial asset and adds guidance for partial sales of nonfinancial assets. TDS is required to adopt ASU 2017-05 on January 1, 2018. Early adoption is permitted. TDS is evaluating the effects that adoption of ASU 2017-05 will have on its financial position and results of operations. In March 2017, the FASB issued Accounting Standards Update 2017-07, Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”). ASU 2017-07 requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net periodic benefit cost must be presented separately from the service cost component and outside of Operating income in the Consolidated Statement of Operations. The guidance also specifies that only the service cost component of net benefit cost is eligible for capitalization. TDS is required to adopt ASU 2017-07 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-07 is not expected to have a significant impact on TDS’ results of operations. Amounts Collected from Customers and Remitted to Governmental Authorities TDS records amounts collected from customers and remitted to governmental authorities on a net basis within a tax liability account if the tax is assessed upon the customer and TDS merely acts as an agent in collecting the tax on behalf of the imposing governmental authority. If the tax is assessed upon TDS, then amounts collected from customers as recovery of the tax are recorded in Service revenues and amounts remitted to governmental authorities are recorded in Selling, general and administrative expenses in the Consolidated Statement of Operations. The amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities totaled $ 19 million and $ 23 million for the three months ended March 31, 2017 and 2016 , respectively.

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Mar. 31, 2017
Fair Value Disclosures [Abstract]
Fair Value Measurements	Note 2 Fair Value Measurements As of March 31, 2017 and December 31, 2016 , TDS did not have any material financial or nonfinancial assets or liabilities that were required to be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. The provisions of GAAP establish a fair value hierarchy that contains three levels for inputs used in fair value measurements. Level 1 inputs include quoted market prices for identical assets or liabilities in active markets. Level 2 inputs include quoted market prices for similar assets and liabilities in active markets or quoted market prices for identical assets and liabilities in inactive markets. Level 3 inputs are unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. A financial instrument’s level within the fair value hierarchy is not representative of its expected performance or its overall risk profile and, therefore, Level 3 assets are not necessarily higher risk than Level 2 assets or Level 1 assets. TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy March 31, 2017 December 31, 2016 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 896 $ 896 $ 900 $ 900 Long-term debt Retail 2 1,753 1,805 1,753 1,741 Institutional 2 533 564 533 532 Other 2 205 204 208 207 The fair value of Cash and cash equivalents approximates the book value due to the short-term nature of these financial instruments. Long-term debt excludes capital lease obligations and the current portion of Long-term debt. The fair value of “Retail” Long-term debt was estimated using market prices for TDS’ 7.0% Senior Notes, 6.875% Senior Notes, 6.625% Senior Notes and 5.875% Senior Notes, and U.S. Cellular’s 6.95% Senior Notes, 7.25% 2063 Senior Notes and 7.25% 2064 Senior Notes. TDS’ “Institutional” debt consists of U.S. Cellular’s 6.7% Senior Notes which are traded over the counter. TDS’ “Other” debt consists of a senior term loan credit facility and other borrowings with financial institutions. TDS estimated the fair value of its Institutional and Other debt through a discounted cash flow analysis using the interest rates or estimated yield to maturity for each borrowing, which ranged from 0.00% to 6.50% and 0.00% to 6.93% at March 31, 2017 and December 31, 2016 , respectively.

Equipment Installment Plans

Equipment Installment Plans	3 Months Ended
	Mar. 31, 2017
Receivables [Abstract]
Equipment Installment Plans	Note 3 Equipment Installment Plans TDS sells devices to customers under equipment installment contracts over a specified time period. For certain equipment installment plans, after a specified period of time or amount of payments, the customer may have the right to upgrade to a new device and have the remaining unpaid equipment installment contract balance waived, subject to certain conditions, including trading in the original device in good working condition and signing a new equipment installment contract. TDS values this trade-in right as a guarantee liability. The guarantee liability is initially measured at fair value and is determined based on assumptions including the probability and timing of the customer upgrading to a new device and the fair value of the device being traded-in at the time of trade-in. As of March 31, 2017 and December 31, 2016 , the guarantee liability related to these plans was $ 27 million and $ 33 million, respectively, and is reflected in Customer deposits and deferred revenues in the Consolidated Balance Sheet. TDS equipment installment plans do not provide for explicit interest charges. Because equipment installment plans have a duration of greater than twelve months, TDS imputes interest. TDS records imputed interest as a reduction to the related accounts receivable and recognizes it over the term of the installment agreement. Equipment installment plan receivables had a weighted average effective imputed interest rate of 11.6% and 11.2% as of March 31, 2017 and December 31, 2016 , respectively. The following table summarizes equipment installment plan receivables as of March 31, 2017 and December 31, 2016 . March 31, 2017 December 31, 2016 (Dollars in millions) Equipment installment plan receivables, gross $ 661 $ 628 Deferred interest (57) (53) Equipment installment plan receivables, net of deferred interest 604 575 Allowance for credit losses (53) (50) Equipment installment plan receivables, net $ 551 $ 525 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Due from customers and agents (Current portion) $ 356 $ 345 Other assets and deferred charges (Non-current portion) 195 180 Equipment installment plan receivables, net $ 551 $ 525 TDS uses various inputs, including internal data, information from the credit bureaus and other sources, to evaluate the credit profiles of its customers. From this evaluation, a credit class is assigned to the customer that determines the number of eligible lines, the amount of credit available, and the down payment requirement, if any. Customers assigned to credit classes requiring no down payment represent a lower risk category, whereas those assigned to credit classes requiring a down payment represent a higher risk category. The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: March 31, 2017 December 31, 2016 Lower Risk Higher Risk Total Lower Risk Higher Risk Total (Dollars in millions) Unbilled $ 582 $ 44 $ 626 $ 553 $ 38 $ 591 Billed — current 20 2 22 23 2 25 Billed — past due 10 3 13 10 2 12 Equipment installment plan receivables, gross $ 612 $ 49 $ 661 $ 586 $ 42 $ 628 The activity in the allowance for credit losses balance for the equipment installment plan receivables was as follows: March 31, 2017 March 31, 2016 (Dollars in millions) Allowance for credit losses, beginning of period $ 50 $ 26 Bad debts expense 15 11 Write-offs, net of recoveries (12) (9) Allowance for credit losses, end of period $ 53 $ 28

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2017
Earnings Per Share [Abstract]
Earnings per Share	Note 4 Earnings Per Share Basic earnings per share available to TDS common shareholders is computed by dividing Net income available to TDS common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share available to TDS common shareholders is computed by dividing Net income available to TDS common shareholders by the weighted average number of common shares outstanding during the period adjusted to include the effects of potentially dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon the exercise of outstanding stock options and the vesting of performance and restricted stock units. The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows: Three Months Ended March 31, 2017 2016 (Dollars and shares in millions, except per share amounts) Basic earnings per share available to TDS common shareholders: Net income available to TDS common shareholders used in basic earnings per share $ 37 $ 8 Adjustments to compute diluted earnings: Noncontrolling interest adjustment – – Net income available to TDS common shareholders used in diluted earnings per share $ 37 $ 8 Weighted average number of shares used in basic earnings per share: Common Shares 103 102 Series A Common Shares 7 7 Total 110 109 Effects of dilutive securities 2 1 Weighted average number of shares used in diluted earnings per share 112 110 Basic earnings per share available to TDS common shareholders $ 0.34 $ 0.07 Diluted earnings per share available to TDS common shareholders $ 0.33 $ 0.07 Certain Common Shares issuable upon the exercise of stock options, vesting of performance and restricted stock units or conversion of preferred shares were not included in average diluted shares outstanding for the calculation of Diluted earnings per share available to TDS common shareholders because their effects were antidilutive. The number of such Common Shares excluded was 4 million shares and 7 million shares for th e three months ended March 31, 2017 and 2016 , respectively.

Acquisitions Divestures And Exc

Acquisitions Divestures And Exchanges	3 Months Ended
	Mar. 31, 2017
Acquisitions, Divestitures and Exchanges [Abstract]
Acquisitions, Divestures and Exchanges	Note 5 Acquisitions, Divestitures and Exchanges In February 2016, U.S. Cellular entered into an agreement with a third party to exchange certain 700 MHz licenses for certain AWS and PCS licenses and $ 28 million of cash. This license exchange was accomplished in two closings. The first closing occurred in the second quarter of 2016, at which time U.S. Cellular received $ 13 million of cash and recorded a gain of $ 9 million. The second closing occurred in the first quarter of 2017, at which time U.S. Cellular received $ 15 million of cash and recorded a gain of $ 17 million. In July 2016, the FCC announced U.S. Cellular as a qualified bidder in the FCC’s forward auction of 600 MHz spectrum licenses, referred to as Auction 1002. Prior to commencement of the forward auction, U.S. Cellular made an upfront payment to the FCC of $ 143 million in June 2016 to establish its initial bidding eligibility. The auction deposit is recorded as a component of Other assets and deferred charges as of March 31, 2017 and December 31, 2016. In April 2017, the FCC announced by way of public notice that U.S. Cellular was the winning bidder for 188 licenses for an aggregate purchase price of $ 329 million. U.S. Cellular is required to pay $ 186 million, the remaining amount due for the purchase of the licenses, to the FCC in May 2017. U.S. Cellular expects to receive the licenses at the conclusion of the FCC’s standard post-auction licensing process.

Intangible Assets

Intangible Assets	3 Months Ended
	Mar. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Note 6 Intangible Assets Activity related to TDS’ Licenses for the three months ended March 31, 2017 , is presented below. Goodwill increased by $4 million and Other intangible assets increased by $1 million in the Cable segment in the first quarter of 2017 due to a small acquisition of a fiber telecommunications company. There were no changes to Franchise rights during the three months ended March 31, 2017 . Licenses (Dollars in millions) Balance December 31, 2016 $ 1,895 Acquisitions 3 Transferred to Assets held for sale (5) Exchanges - Licenses received 11 Balance March 31, 2017 $ 1,904

Investments In Unconsolidated E

Investments In Unconsolidated Entities	3 Months Ended
	Mar. 31, 2017
Investments in Unconsolidated Entities [Abstract]
Investments in Unconsolidated Entities	Note 7 Investments in Unconsolidated Entities Investments in unconsolidated entities consist of amounts invested in wireless and wireline entities in which TDS holds a noncontrolling interest. These investments are accounted for using either the equity or cost method. The following table, which is based in part on information provided by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended March 31, 2017 2016 (Dollars in millions) Revenues $ 1,615 $ 1,688 Operating expenses 1,217 1,236 Operating income 398 452 Other expense, net – (4) Net income $ 398 $ 448

Variable Interest Entities

Variable Interest Entities	3 Months Ended
	Mar. 31, 2017
Variable Interest Entities [Abstract]
Variable Interest Entities	Note 8 Variable Interest Entities Consolidated VIEs TDS consolidates variable interest entities (“VIEs”) in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance and (b) the obligation to absorb the VIE losses and right to receive benefits that are significant to the VIE. TDS reviews these criteria initially at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in TDS’ Form 10-K for the year ended December 31, 2016 . In the three months ended March 31, 2017 , U.S. Cellular formed USCC EIP LLC, a special purpose entity (“SPE”), to facilitate the potential financing of its equipment installment plan receivable balances in the future. Under a Receivables Sale Agreement, U.S. Cellular wholly owned, majority owned and unconsolidated entities, collectively referred to as “affiliated entities”, transfer device equipment installment contracts to USCC EIP LLC. This SPE will aggregate device equipment installment plan contracts for further transfer into a separate bankruptcy remote securitization trust structure, perform servicing, collection and all other administrative activities related to accounting for equipment installment plan contracts. USCC EIP LLC’s sole business consists of the acquisition of the receivables from U.S. Cellular affiliated entities for the future transfer of receivables into a trust. Given that this SPE lacks sufficient equity to finance its activities and U.S. Cellular has the power to direct the activities of this SPE, U.S. Cellular is deemed the primary beneficiary of this variable interest entity, and will consolidate the assets and liabilities of USCC EIP LLC into the consolidated financial statements. In the three months ended March 31, 2017 , net equipment installment plan receivables totaling $679 million were transferred to the newly formed SPE from these affiliated entities. Because TDS fully consolidates USCC EIP LLC, the transfer of receivables into this SPE did not have a material impact to the consolidated financial statements of TDS. As of March 31, 2017, TDS had not executed a securitized borrowing from a third party. The following VIEs were formed to participate in FCC auctions of wireless spectrum and to fund, establish, and provide wireless service with respect to any FCC licenses won in the auctions: Advantage Spectrum, L.P. (“Advantage Spectrum”) and Sunshine Spectrum, Inc. (“Sunshine Spectrum”), the general partner of Advantage Spectrum (former general partner was Frequency Advantage, L.P. (“Frequency Advantage”)); Aquinas Wireless, L.P. (“Aquinas Wireless”); and King Street Wireless, L.P. (“King Street Wireless”) and King Street Wireless, Inc., the general partner of King Street Wireless. These particular VIEs are collectively referred to as designated entities. The power to direct the activities that most significantly impact the economic performance of these VIEs is shared. Specifically, the general partner of these VIEs has the exclusive right to manage, operate and control the limited partnerships and make all decisions to carry on the business of the partnerships. The general partner of each partnership needs the consent of the limited partner, an indirect TDS subsidiary, to sell or lease certain licenses, to make certain large expenditures, admit other partners or liquidate the limited partnerships. Although the power to direct the activities of these VIEs is shared, TDS has the most significant level of exposure to the variability associated with the economic performance of the VIEs, indicating that TDS is the primary beneficiary of the VIEs. Therefore, in accordance with GAAP, these VIEs are consolidated. In January 2017, Sunshine Spectrum and the other owner of Frequency Advantage (the previous general partner of Advantage Spectrum) completed a series of transactions whereby Frequency Advantage was dissolved and Sunshine Spectrum became the new general partner of Advantage Spectrum. Consistent with its previous treatment of Frequency Advantage and in accordance with GAAP, TDS consolidates Sunshine Spectrum in its financial statements. TDS also consolidates other VIEs that are limited partnerships that provide wireless service. A limited partnership is a variable interest entity unless the limited partners hold substantive participating rights or kick-out rights over the general partners. For certain limited partnerships, U.S. Cellular is the general partner and manages the operations. In these partnerships, the limited partners do not have substantive kick-out or participating rights and, further, such limited partners do not have the authority to remove the general partner. Therefore, these limited partnerships are also recognized as VIEs and are consolidated under the variable interest model. The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. March 31, December 31, 2017 2016 (Dollars in millions) Assets Cash and cash equivalents $ 2 $ 2 Accounts receivable 395 39 Other current assets 6 6 Licenses 649 649 Property, plant and equipment, net 91 93 Other assets and deferred charges 197 15 Total assets $ 1,340 $ 804 Liabilities Current liabilities $ 41 $ 18 Deferred liabilities and credits 12 12 Total liabilities $ 53 $ 30 Unconsolidated VIEs TDS manages the operations of and holds a variable interest in certain other limited partnerships, but is not the primary beneficiary of these entities and, therefore, does not consolidate them under the variable interest model. TDS’ total investment in these unconsolidated entities was $ 6 million at March 31, 2017 and December 31, 2016 , and is included in Investments in unconsolidated entities in TDS’ Consolidated Balance Sheet. The maximum exposure from unconsolidated VIEs is limited to the investment held by TDS in those entities. Other Related Matters TDS made contributions, loans and/or advances to its VIEs totaling $ 654 million, of which $ 650 million is related to USCC EIP LLC as discussed above, and $ 13 million during the three months ended March 31, 2017 and March 31, 2016 , respectively. TDS may agree to make additional capital contributions and/or advances to these or other VIEs and/or to their general partners to provide additional funding for operations or the development of licenses granted in various auctions. TDS may finance such amounts with a combination of cash on hand, borrowings under its revolving credit agreement and/or other long-term debt. There is no assurance that TDS will be able to obtain additional financing on commercially reasonable terms or at all to provide such financial support.

Noncontrolling Interests

Noncontrolling Interests	3 Months Ended
	Mar. 31, 2017
Noncontrolling Interests [Abstract]
Noncontrolling Interests	Note 9 Noncontrolling Interests The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in U.S. Cellular on TDS’ equity: Three Months Ended March 31, 2017 2016 (Dollars in millions) Net income attributable to TDS shareholders $ 37 $ 8 Transfer (to) from the noncontrolling interests Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares (1) (2) Change in TDS' Capital in excess of par value from U.S. Cellular's repurchases of U.S. Cellular shares – – Purchase of ownership in subsidiaries from noncontrolling interests – – Net transfers (to) from noncontrolling interests (1) (2) Change from net income attributable to TDS and transfers (to) from noncontrolling interests $ 36 $ 6

Business Segment Information

Business Segment Information	3 Months Ended
	Mar. 31, 2017
Business Segment Information [Abstract]
Business Segment Information	Note 10 Business Segment Information U.S. Cellular and TDS Telecom are billed for all services they receive from TDS, consisting primarily of information processing, accounting and finance, and general management services. Such billings are based on expenses specifically identified to U.S. Cellular and TDS Telecom and on allocations of common expenses. Management believes the method used to allocate common expenses is reasonable and that all expenses and costs applicable to U.S. Cellular and TDS Telecom are reflected in the accompanying business segment information on a basis that is representative of what they would have been if U.S. Cellular and TDS Telecom operated on a stand-alone basis. Financial data for TDS’ reportable segments for the three month periods ended, or as of March 31, 2017 and 2016 , is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of March 31, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 746 $ 179 $ 49 $ 29 $ (1) $ 256 $ (5) $ 997 Equipment and product sales 190 – – 43 – 43 8 241 Total operating revenues 1 936 179 49 71 (1) 299 3 1,238 Cost of services (excluding Depreciation, amortization and accretion reported below) 175 63 24 20 (1) 107 – 282 Cost of equipment and products 228 1 – 36 – 36 6 270 Selling, general and administrative 339 48 13 11 – 71 (4) 406 Depreciation, amortization and accretion 153 39 10 7 – 56 2 211 (Gain) loss on asset disposals, net 4 – – – – 1 (1) 4 (Gain) loss on license sales and exchanges, net (17) – – – – – – (17) Operating income (loss) 1 54 29 2 (2) – 29 (1) 82 Equity in earnings of unconsolidated entities 33 – – – – – (1) 32 Interest and dividend income 1 3 1 – – – 1 – 4 Interest expense (28) – – (1) – (1) (13) (42) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 61 30 2 (3) – 29 (13) 77 Income tax expense (benefit) 2 33 11 (10) 34 Net income (loss) 28 18 (3) 43 Add back: Depreciation, amortization and accretion 153 39 10 7 – 56 2 211 (Gain) loss on asset disposals, net 4 – – – – 1 (1) 4 (Gain) loss on license sales and exchanges, net (17) – – – – – – (17) Interest expense 28 – – 1 – 1 13 42 Income tax expense (benefit) 2 33 11 (10) 34 Adjusted EBITDA 3 $ 229 $ 69 $ 13 $ 5 $ – $ 86 $ 2 $ 317 Investments in unconsolidated entities $ 434 $ 4 $ – $ – $ – $ 4 $ 34 $ 472 Total assets $ 7,024 $ 1,204 $ 609 $ 264 $ – $ 2,077 $ 248 $ 9,349 Capital expenditures $ 61 $ 17 $ 9 $ 6 $ – $ 33 $ 2 $ 96 Numbers may not foot due to rounding. TDS Telecom Three Months Ended or as of March 31, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 771 $ 173 $ 45 $ 29 $ (1) $ 246 $ (6) $ 1,011 Equipment and product sales 198 – – 35 – 35 10 243 Total operating revenues 1 969 173 45 64 (1) 281 4 1,254 Cost of services (excluding Depreciation, amortization and accretion reported below) 184 62 22 21 (1) 104 – 288 Cost of equipment and products 256 1 – 29 – 30 5 291 Selling, general and administrative 361 48 12 11 – 71 (1) 431 Depreciation, amortization and accretion 153 42 9 7 – 58 1 212 (Gain) loss on asset disposals, net 5 – 1 – – 1 – 6 Operating income (loss) 1 10 20 1 (4) – 17 (1) 26 Equity in earnings of unconsolidated entities 35 – – – – – – 35 Interest and dividend income 1 2 1 – – – 1 – 3 Interest expense (28) 1 – (1) – – (13) (41) Other, net 1 – (1) – – (1) – – Income (loss) before income taxes 20 22 – (5) – 17 (14) 23 Income tax expense (benefit) 2 11 7 (5) 13 Net income (loss) 9 10 (9) 10 Add back: Depreciation, amortization and accretion 153 42 9 7 – 58 1 212 (Gain) loss on asset disposals, net 5 – 1 – – 1 – 6 Interest expense 28 (1) – 1 – – 13 41 Income tax expense (benefit) 2 11 7 (5) 13 Adjusted EBITDA 3 $ 206 $ 63 $ 10 $ 3 $ – $ 76 $ – $ 282 Investments in unconsolidated entities $ 384 $ 4 $ – $ – $ – $ 4 $ 35 $ 423 Total assets $ 7,057 $ 1,291 $ 581 $ 270 $ – $ 2,142 $ 184 $ 9,383 Capital expenditures $ 79 $ 27 $ 13 $ 2 $ – $ 42 $ 4 $ 125 1 Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for “TDS Telecom Total”. 3 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (“Adjusted EBITDA”) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance.

Summary of Significant Accounti

Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Significant Accounting Policies)	3 Months Ended
	Mar. 31, 2017
Accounting Policies [Abstract]
Principles of Consolidation	The accounting policies of Telephone and Data Systems, Inc. (“TDS”) conform to accounting principles generally accepted in the United States of America (“GAAP”) as set forth in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). The consolidated financial statements include the accounts of TDS and subsidiaries in which it has a controlling financial interest, including TDS’ 83% -owned wireless telephone subsidiary, United States Cellular Corporation (“U.S. Cellular”) and TDS’ wholly-owned subsidiary, TDS Telecommunications Corporation (“TDS Telecom”). In addition, the consolidated financial statements include certain entities in which TDS has a variable interest that require consolidation under GAAP. All material intercompany accounts and transactions have been eliminated. TDS’ business segments reflected in this Quarterly Report on Form 10-Q for the period ended March 31, 2017 , are U.S. Cellular, Wireline, Cable, and Hosted and Managed Services (“HMS”) operations. TDS’ non-reportable other business activities are presented as “Corporate, Eliminations and Other”, which includes the operations of TDS’ wholly-owned subsidiary Suttle-Straus, Inc. (“Suttle-Straus”). Suttle-Straus’ financial results were not significant to TDS’ operations. All of TDS’ segments operate only in the United States, except for HMS, which includes an insignificant foreign operation. See Note 10 — Business Segment Information for summary financial information on each business segment.
Basis of Accounting	The unaudited consolidated financial statements included herein have been prepared by TDS pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, TDS believes that the disclosures included herein are adequate to make the information presented not misleading. Calculated amounts and percentages are based on the underlying actual numbers rather than the numbers rounded to millions as presented. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in TDS’ Annual Report on Form 10-K (“Form 10-K”) for the year ended December 31, 2016 . The accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring items, unless otherwise disclosed) necessary for the fair statement of TDS’ financial position as of March 31, 2017 and December 31, 2016 , its results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2017 and 2016 . These results are not necessarily indicative of the results to be expected for the full year. TDS has not changed its significant accounting and reporting policies from those disclosed in its Form 10-K for the year ended December 31, 2016 , except as described below.
Changes in Accounting Principles	TDS equipment revenue under equipment installment plan contracts is recognized at the time the device is delivered to the end-user customer for the selling price of the device, net of any deferred imputed interest or trade-in right, if applicable. Imputed interest is reflected as a reduction to the receivable balance and recognized over the duration of the plan as Service revenues. See Note 3 — Equipment Installment Plans . Effective January 1, 2017, TDS elected to change the classification of interest income on equipment installment plan contracts from Interest and dividend income to Service revenues in the Consolidated Statement of Operations. TDS believes this classification is preferable because financing of devices as part of enrolling customers for service is an activity that is central to TDS’ operations, and it is consistent with the presentation by others in the industry. Comparative financial statements of prior years have been adjusted to apply the new classification retrospectively. As a result of this change in classification, Service revenues for the three months ended March 31, 2016, increased by $11 million from previously reported amounts, with a corresponding decrease in Interest and dividend income. In comparison, Service revenues for the three months ended March 31, 2017 , include $ 16 million of equipment installment plan interest income, which would have been reported within Interest and dividend income had the change not been implemented. This change did not have an impact on Income before income taxes, Net income, or Earnings per share for the three months ended March 31, 2016, nor did it have a cumulative impact to Retained earnings as of any date presented.
Recently Issued Accounting Pronouncements	In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”) and has since amended the standard with Accounting Standards Update 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date , Accounting Standards Update 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , Accounting Standards Update 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , Accounting Standards Update 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , and Accounting Standards Update 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . These standards replace existing revenue recognition rules with a single comprehensive model to use in accounting for revenue arising from contracts with customers. TDS is required to adopt ASU 2014-09, as amended, on January 1, 2018. Early adoption as of January 1, 2017, is permitted; however, TDS did not adopt early. ASU 2014-09, as amended, impacts TDS’ revenue recognition related to the allocation of contract revenues between various services and equipment, and the timing of when those revenues are recognized. In addition, ASU 2014-09 requires deferral of incremental contract acquisition and fulfillment costs and subsequent expense recognition over the contract period or expected customer life. TDS has identified that new systems, processes and controls are required to adopt ASU 2014-09, as amended. TDS has substantially completed the design and development of new systems to perform revenue recognition accounting under the provisions of ASU 2014-09, as amended, and is currently engaged in the process of testing these new systems. TDS expects to transition to the new standard under the modified retrospective transition method whereby a cumulative effect adjustment to retained earnings is recognized upon adoption and the guidance is applied prospectively. Upon adoption, the cumulative effect adjustment is expected to include the establishment of contract asset and contract liability accounts with a corresponding adjustment to retained earnings to reflect the reallocation of revenues between service and equipment performance obligations for which control is transferred to customers in different periods. Reallocation impacts generally arise when bundle discounts are provided in a contract arrangement that includes equipment and service performance obligations. In these cases, the revenue will be reallocated according to the relative stand-alone selling prices of the performance obligations included in the bundle and this may be different than how the revenue is billed to the customer and recognized under current guidance. In addition, contract cost assets will be established to reflect costs that will be deferred as incremental contract acquisition and fulfillment costs. Incremental contract acquisition costs generally relate to commissions paid to sales associates while fulfillment costs are generally related to service installation costs on the wireline and cable businesses. TDS is evaluating the effects that adoption of ASU 2014-09, as amended, will have on its financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (“ASU 2016-02”). ASU 2016-02 requires lessees to record a right-of-use asset and lease liability for almost all leases. This ASU does not substantially impact lessor accounting. TDS is required to adopt ASU 2016-02 on January 1, 2019. Early adoption is permitted. Upon adoption of ASU 2016-02, TDS expects a substantial increase to assets and liabilities on its balance sheet. TDS is evaluating the effects that adoption of ASU 2016-02 will have on its financial position and results of operations. In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosure relating to the credit quality of trade and other receivables, including information relating to management’s estimate of credit allowances. TDS is required to adopt ASU 2016-13 on January 1, 2020. Early adoption as of January 1, 2019 is permitted. TDS is evaluating the effects that adoption of ASU 2016-13 will have on its financial position, results of operations and disclosures. In December 2016, the FASB issued Accounting Standards Update 2016-19 Technical Corrections and Improvements (“ASU 2016-19”). ASU 2016-19 includes an amendment to Accounting Standards Codification Subtopic 350-40, Intangibles – Goodwill and Other – Internal-Use Software, which clarifies a software license within the scope of the Subtopic will be accounted for as the acquisition of an intangible asset and the incurrence of a liability to the extent that the license fees are not fully paid at acquisition. TDS adopted this standard prospectively for all arrangements entered into or materially modified after January 1, 2017. In January 2017, the FASB issued Accounting Standards Update 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 eliminates Step 2 of the current goodwill impairment test. Goodwill impairment loss will be measured as the amount by which a reporting unit’s carrying amount exceeds its fair value. TDS is required to adopt ASU 2017-04 on January 1, 2020. Early adoption is permitted. TDS is assessing whether it will early adopt ASU 2017-04. In February 2017, the FASB issued Accounting Standards Update 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets: Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets (“ASU 2017-05”). ASU 2017-05 clarifies how entities account for the derecognition of a nonfinancial asset and adds guidance for partial sales of nonfinancial assets. TDS is required to adopt ASU 2017-05 on January 1, 2018. Early adoption is permitted. TDS is evaluating the effects that adoption of ASU 2017-05 will have on its financial position and results of operations. In March 2017, the FASB issued Accounting Standards Update 2017-07, Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”). ASU 2017-07 requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net periodic benefit cost must be presented separately from the service cost component and outside of Operating income in the Consolidated Statement of Operations. The guidance also specifies that only the service cost component of net benefit cost is eligible for capitalization. TDS is required to adopt ASU 2017-07 on January 1, 2018. Early adoption is permitted. The adoption of ASU 2017-07 is not expected to have a significant impact on TDS’ results of operations.
Variable Interest Entities	TDS consolidates variable interest entities (“VIEs”) in which it has a controlling financial interest as defined by GAAP and is therefore deemed the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance and (b) the obligation to absorb the VIE losses and right to receive benefits that are significant to the VIE. TDS reviews these criteria initially at the time it enters into agreements and subsequently when events warranting reconsideration occur. These VIEs have risks similar to those described in the “Risk Factors” in TDS’ Form 10-K for the year ended December 31, 2016 .

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2017
Fair Value Disclosures [Abstract]
Fair value measurements	TDS has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. Level within the Fair Value Hierarchy March 31, 2017 December 31, 2016 Book Value Fair Value Book Value Fair Value (Dollars in millions) Cash and cash equivalents 1 $ 896 $ 896 $ 900 $ 900 Long-term debt Retail 2 1,753 1,805 1,753 1,741 Institutional 2 533 564 533 532 Other 2 205 204 208 207

Equipment Installment Plans (Ta

Equipment Installment Plans (Table)	3 Months Ended
	Mar. 31, 2017
Receivables [Abstract]
Equipment installment plan receivables	The following table summarizes equipment installment plan receivables as of March 31, 2017 and December 31, 2016 . March 31, 2017 December 31, 2016 (Dollars in millions) Equipment installment plan receivables, gross $ 661 $ 628 Deferred interest (57) (53) Equipment installment plan receivables, net of deferred interest 604 575 Allowance for credit losses (53) (50) Equipment installment plan receivables, net $ 551 $ 525 Net balance presented in the Consolidated Balance Sheet as: Accounts receivable — Due from customers and agents (Current portion) $ 356 $ 345 Other assets and deferred charges (Non-current portion) 195 180 Equipment installment plan receivables, net $ 551 $ 525
Equipment installment plan receivables credit categories	The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows: March 31, 2017 December 31, 2016 Lower Risk Higher Risk Total Lower Risk Higher Risk Total (Dollars in millions) Unbilled $ 582 $ 44 $ 626 $ 553 $ 38 $ 591 Billed — current 20 2 22 23 2 25 Billed — past due 10 3 13 10 2 12 Equipment installment plan receivables, gross $ 612 $ 49 $ 661 $ 586 $ 42 $ 628
Equipment installment plans allowance for credit losses	The activity in the allowance for credit losses balance for the equipment installment plan receivables was as follows: March 31, 2017 March 31, 2016 (Dollars in millions) Allowance for credit losses, beginning of period $ 50 $ 26 Bad debts expense 15 11 Write-offs, net of recoveries (12) (9) Allowance for credit losses, end of period $ 53 $ 28

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2017
Earnings Per Share [Abstract]
Earnings per share	The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows: Three Months Ended March 31, 2017 2016 (Dollars and shares in millions, except per share amounts) Basic earnings per share available to TDS common shareholders: Net income available to TDS common shareholders used in basic earnings per share $ 37 $ 8 Adjustments to compute diluted earnings: Noncontrolling interest adjustment – – Net income available to TDS common shareholders used in diluted earnings per share $ 37 $ 8 Weighted average number of shares used in basic earnings per share: Common Shares 103 102 Series A Common Shares 7 7 Total 110 109 Effects of dilutive securities 2 1 Weighted average number of shares used in diluted earnings per share 112 110 Basic earnings per share available to TDS common shareholders $ 0.34 $ 0.07 Diluted earnings per share available to TDS common shareholders $ 0.33 $ 0.07

Intangible Assets (Tables)

Intangible Assets (Tables)	3 Months Ended
	Mar. 31, 2017
Licenses
Licenses	Licenses (Dollars in millions) Balance December 31, 2016 $ 1,895 Acquisitions 3 Transferred to Assets held for sale (5) Exchanges - Licenses received 11 Balance March 31, 2017 $ 1,904

Investment in Unconsolidated En

Investment in Unconsolidated Entities (Tables)	3 Months Ended
	Mar. 31, 2017
Investments in Unconsolidated Entities [Abstract]
Equity method investments, summarized results of operations	The following table, which is based in part on information provided by third parties, summarizes the combined results of operations of TDS’ equity method investments. Three Months Ended March 31, 2017 2016 (Dollars in millions) Revenues $ 1,615 $ 1,688 Operating expenses 1,217 1,236 Operating income 398 452 Other expense, net – (4) Net income $ 398 $ 448

Variable Interest Entities (Tab

Variable Interest Entities (Tables)	3 Months Ended
	Mar. 31, 2017
Variable Interest Entities [Abstract]
Consolidated VIE assets and liabilities	The following table presents the classification and balances of the consolidated VIEs’ assets and liabilities in TDS’ Consolidated Balance Sheet. March 31, December 31, 2017 2016 (Dollars in millions) Assets Cash and cash equivalents $ 2 $ 2 Accounts receivable 395 39 Other current assets 6 6 Licenses 649 649 Property, plant and equipment, net 91 93 Other assets and deferred charges 197 15 Total assets $ 1,340 $ 804 Liabilities Current liabilities $ 41 $ 18 Deferred liabilities and credits 12 12 Total liabilities $ 53 $ 30

Noncontrolling Interests (Table

Noncontrolling Interests (Tables)	3 Months Ended
	Mar. 31, 2017
Noncontrolling Interests [Abstract]
Noncontrolling interests	The following schedule discloses the effects of Net income attributable to TDS shareholders and changes in TDS’ ownership interest in U.S. Cellular on TDS’ equity: Three Months Ended March 31, 2017 2016 (Dollars in millions) Net income attributable to TDS shareholders $ 37 $ 8 Transfer (to) from the noncontrolling interests Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares (1) (2) Change in TDS' Capital in excess of par value from U.S. Cellular's repurchases of U.S. Cellular shares – – Purchase of ownership in subsidiaries from noncontrolling interests – – Net transfers (to) from noncontrolling interests (1) (2) Change from net income attributable to TDS and transfers (to) from noncontrolling interests $ 36 $ 6

Business Segment (Tables)

Business Segment (Tables)	3 Months Ended
	Mar. 31, 2017
Business Segment Information [Abstract]
Business segment information	Financial data for TDS’ reportable segments for the three month periods ended, or as of March 31, 2017 and 2016 , is as follows. See Note 1 — Basis of Presentation for additional information. TDS Telecom Three Months Ended or as of March 31, 2017 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 746 $ 179 $ 49 $ 29 $ (1) $ 256 $ (5) $ 997 Equipment and product sales 190 – – 43 – 43 8 241 Total operating revenues 1 936 179 49 71 (1) 299 3 1,238 Cost of services (excluding Depreciation, amortization and accretion reported below) 175 63 24 20 (1) 107 – 282 Cost of equipment and products 228 1 – 36 – 36 6 270 Selling, general and administrative 339 48 13 11 – 71 (4) 406 Depreciation, amortization and accretion 153 39 10 7 – 56 2 211 (Gain) loss on asset disposals, net 4 – – – – 1 (1) 4 (Gain) loss on license sales and exchanges, net (17) – – – – – – (17) Operating income (loss) 1 54 29 2 (2) – 29 (1) 82 Equity in earnings of unconsolidated entities 33 – – – – – (1) 32 Interest and dividend income 1 3 1 – – – 1 – 4 Interest expense (28) – – (1) – (1) (13) (42) Other, net (1) – – – – – 2 1 Income (loss) before income taxes 61 30 2 (3) – 29 (13) 77 Income tax expense (benefit) 2 33 11 (10) 34 Net income (loss) 28 18 (3) 43 Add back: Depreciation, amortization and accretion 153 39 10 7 – 56 2 211 (Gain) loss on asset disposals, net 4 – – – – 1 (1) 4 (Gain) loss on license sales and exchanges, net (17) – – – – – – (17) Interest expense 28 – – 1 – 1 13 42 Income tax expense (benefit) 2 33 11 (10) 34 Adjusted EBITDA 3 $ 229 $ 69 $ 13 $ 5 $ – $ 86 $ 2 $ 317 Investments in unconsolidated entities $ 434 $ 4 $ – $ – $ – $ 4 $ 34 $ 472 Total assets $ 7,024 $ 1,204 $ 609 $ 264 $ – $ 2,077 $ 248 $ 9,349 Capital expenditures $ 61 $ 17 $ 9 $ 6 $ – $ 33 $ 2 $ 96 Numbers may not foot due to rounding. TDS Telecom Three Months Ended or as of March 31, 2016 U.S. Cellular Wireline Cable HMS TDS Telecom Eliminations TDS Telecom Total Corporate, Eliminations and Other Total (Dollars in millions) Operating revenues Service 1 $ 771 $ 173 $ 45 $ 29 $ (1) $ 246 $ (6) $ 1,011 Equipment and product sales 198 – – 35 – 35 10 243 Total operating revenues 1 969 173 45 64 (1) 281 4 1,254 Cost of services (excluding Depreciation, amortization and accretion reported below) 184 62 22 21 (1) 104 – 288 Cost of equipment and products 256 1 – 29 – 30 5 291 Selling, general and administrative 361 48 12 11 – 71 (1) 431 Depreciation, amortization and accretion 153 42 9 7 – 58 1 212 (Gain) loss on asset disposals, net 5 – 1 – – 1 – 6 Operating income (loss) 1 10 20 1 (4) – 17 (1) 26 Equity in earnings of unconsolidated entities 35 – – – – – – 35 Interest and dividend income 1 2 1 – – – 1 – 3 Interest expense (28) 1 – (1) – – (13) (41) Other, net 1 – (1) – – (1) – – Income (loss) before income taxes 20 22 – (5) – 17 (14) 23 Income tax expense (benefit) 2 11 7 (5) 13 Net income (loss) 9 10 (9) 10 Add back: Depreciation, amortization and accretion 153 42 9 7 – 58 1 212 (Gain) loss on asset disposals, net 5 – 1 – – 1 – 6 Interest expense 28 (1) – 1 – – 13 41 Income tax expense (benefit) 2 11 7 (5) 13 Adjusted EBITDA 3 $ 206 $ 63 $ 10 $ 3 $ – $ 76 $ – $ 282 Investments in unconsolidated entities $ 384 $ 4 $ – $ – $ – $ 4 $ 35 $ 423 Total assets $ 7,057 $ 1,291 $ 581 $ 270 $ – $ 2,142 $ 184 $ 9,383 Capital expenditures $ 79 $ 27 $ 13 $ 2 $ – $ 42 $ 4 $ 125 1 Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details. 2 Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for “TDS Telecom Total”. 3 Adjusted earnings before interest, taxes, depreciation, amortization and accretion (“Adjusted EBITDA”) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance.

Basis of Presentation (Details)

Basis of Presentation (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Basis of Presentation [Line Items]
Amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities	$ 19	$ 23
Equipment Installment Plans Accounting Change
Service revenue	997	1,011
Interest and dividend income	4	3
Adjustment
Equipment Installment Plans Accounting Change
Service revenue	$ 16	11
Interest and dividend income		$ (11)
U.S. Cellular
Basis of Presentation [Line Items]
TDS ownership of U.S. Cellular	83.00%

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Financial Instruments
Cash and cash equivalents	$ 896	$ 900	$ 1,054	$ 985
Institutional and Other | Minimum
Financial Instruments
Fair value assumption, interest rate	0.00%	0.00%
Institutional and Other | Maximum
Financial Instruments
Fair value assumption, interest rate	6.50%	6.93%
Fair Value | Level 1
Financial Instruments
Cash and cash equivalents	$ 896	$ 900
Fair Value | Level 2 | Retail
Financial Instruments
Long-term debt	1,805	1,741
Fair Value | Level 2 | Institutional
Financial Instruments
Long-term debt	564	532
Fair Value | Level 2 | Other
Financial Instruments
Long-term debt	204	207
Book Value
Financial Instruments
Cash and cash equivalents	896	900
Book Value | Retail
Financial Instruments
Long-term debt	1,753	1,753
Book Value | Institutional
Financial Instruments
Long-term debt	533	533
Book Value | Other
Financial Instruments
Long-term debt	$ 205	$ 208

Equipment Installment Plan Rece

Equipment Installment Plan Receivables, EIP Receivables (Details) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Equipment installment plans [Line Items]
Equipment installment plan receivables, gross	$ 661	$ 628
Deferred interest	(57)	(53)
Equipment installment plan receivables, net of deferred interest	604	575
Allowance for credit losses	(53)	(50)
Equipment installment plan receivables, net	551	525
Accounts receivable - Due from customers and agents
Equipment installment plans [Line Items]
Equipment installment plan receivables, net	356	345
Other assets and deferred charges
Equipment installment plans [Line Items]
Equipment installment plan receivables, net	$ 195	$ 180

Equipment Installment Plan Re30

Equipment Installment Plan Receivables, Gross Receivables by Credit Category (Details) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	$ 661	$ 628
Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	626	591
Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	22	25
Equipment installment plan receivables, past due	13	12
Lower Risk
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	612	586
Lower Risk | Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	582	553
Lower Risk | Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	20	23
Equipment installment plan receivables, past due	10	10
Higher Risk
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables, gross	49	42
Higher Risk | Unbilled
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	44	38
Higher Risk | Billed
Financing Receivable, Recorded Investment [Line Items]
Equipment installment plan receivables	2	2
Equipment installment plan receivables, past due	$ 3	$ 2

Equipment Installment Plan Re31

Equipment Installment Plan Receivables, Unamortized Imputed Discount and Allowance for Credit Losses (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for credit losses, beginning of period	$ 50
Allowance for credit losses, end of period	53
Equipment Installment Plan Receivable
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for credit losses, beginning of period	50	$ 26
Bad debts expense	15	11
Write-offs, net of recoveries	(12)	(9)
Allowance for credit losses, end of period	$ 53	$ 28

Equipment Installment Plan Re32

Equipment Installment Plan Receivables, Narrative (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Equipment installment plans [Line Items]
Guarantee liability	$ 27	$ 33
Imputed interest rate	11.60%	11.20%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Earnings per share
Net income available to TDS common shareholders used in basic earnings per share	$ 37	$ 8
Net income available to TDS common shareholders used in diluted earnings per share	$ 37	$ 8
Weighted average number of shares used in basic earnings per share	110	109
Effects of dilutive securities	2	1
Weighted average number of shares used in diluted earnings per share	112	110
Basic earnings per share available to TDS common shareholders	$ 0.34	$ 0.07
Diluted earnings per share available to TDS common shareholders	$ 0.33	$ 0.07
Earnings per share, Other disclosures
Antidilutive securities	4	7
Common Shares
Earnings per share
Weighted average number of shares used in basic earnings per share	103	102
Series A Common Shares
Earnings per share
Weighted average number of shares used in basic earnings per share	7	7

Acquisitions, Divestitures and

Acquisitions, Divestitures and Exchanges (Details) $ in Millions	1 Months Ended		3 Months Ended
	May 31, 2017USD ($)	Jun. 30, 2016USD ($)	Mar. 31, 2017USD ($)	Jun. 30, 2016USD ($)	Mar. 31, 2016USD ($)	Apr. 30, 2017USD ($)	Feb. 29, 2016USD ($)
Acquisitions
Cash paid for acquisitions and licenses			$ 14
Exchanges
Cash received from divestitures and exchanges			16		$ 2
Gain on license sales and exchanges			17
U.S. Cellular
Exchanges
Gain on license sales and exchanges			17
U.S. Cellular | License exchange 1
Exchanges
Net cash to be received							$ 28
U.S. Cellular | License exchange 1, first closing
Exchanges
Cash received from divestitures and exchanges				$ 13
Gain on license sales and exchanges				$ 9
U.S. Cellular | License exchange 1, second closing
Exchanges
Cash received from divestitures and exchanges			15
Gain on license sales and exchanges			$ 17
U.S. Cellular | Auction 1002
Acquisitions
Federal Communications Commission deposit		$ 143
U.S. Cellular | Auction 1002 | Subsequent event
Acquisitions
Fcc License Auction Total Licenses Won						188
Fcc License Auction Total Winning Bid						$ 329
U.S. Cellular | Auction 1002 | Future period
Acquisitions
Cash paid for acquisitions and licenses	$ 186

Intangible Assets (Details)

Intangible Assets (Details) $ in Millions	3 Months Ended
	Mar. 31, 2017USD ($)
TDS Telecom Cable
Intangible assets, other disclosures
Goodwill acquired during period	$ 4
Other intangible assets acquired	1
Licenses
Licenses
Balance, beginning of period	1,895
Acquisitions	3
Transferred to Assets held for sale	(5)
Exchange - Licenses received	11
Balance, end of period	$ 1,904

Investment in Unconsolidated 36

Investment in Unconsolidated Entities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Equity method investments, combined income statements
Revenues	$ 1,615	$ 1,688
Operating expenses	1,217	1,236
Operating income	398	452
Other expense, net		(4)
Net income	$ 398	$ 448

Variable Interest Entities (Det

Variable Interest Entities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016	Dec. 31, 2015
Assets
Cash and cash equivalents	$ 896	$ 1,054	$ 900	$ 985
Accounts receivable	739		753
Other current assets	30		32
Licenses	1,904		1,895
Property, plant and equipment, net	3,449		3,555
Other assets and deferred charges	449		434
Liabilities
Current liabilities	738		887
Variable Interest Entities, Other Disclosures
Transfer of net equipment installment plan receivables	679
Capital contributions, loans or advances	654	13
Investments in unconsolidated entities	472	$ 423	451
Consolidated Variable Interest Entities
Assets
Cash and cash equivalents	2		2
Accounts receivable	395		39
Other current assets	6		6
Licenses	649		649
Property, plant and equipment, net	91		93
Other assets and deferred charges	197		15
Total assets	1,340		804
Liabilities
Current liabilities	41		18
Deferred liabilities and credits	12		12
Total liabilities	53		30
Unconsolidated Variable Interest Entities
Variable Interest Entities, Other Disclosures
Investments in unconsolidated entities	6		$ 6
USCC EIP LLC
Variable Interest Entities, Other Disclosures
Capital contributions, loans or advances	$ 650

Noncontrolling Interests (Detai

Noncontrolling Interests (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Noncontrolling Interests [Abstract]
Net income attributable to TDS shareholders	$ 37	$ 8
Transfer (to) from the noncontrolling interests
Change in TDS' Capital in excess of par value from U.S. Cellular's issuance of U.S. Cellular shares	(1)	(2)
Net transfers (to) from noncontrolling interests	(1)	(2)
Change from net income attributable to TDS and transfers (to) from noncontrolling interests	$ 36	$ 6

Business Segment (Details)

Business Segment (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2017		Mar. 31, 2016	Dec. 31, 2016
Segment Reporting Information [Line Items]
Service		$ 997		$ 1,011
Equipment and product sales		241		243
Total operating revenues		1,238		1,254
Cost of services (excluding Depreciation, amortization and accretion reported below)		282		288
Cost of equipment and products		270		291
Selling, general and administrative		406		431
Depreciation, amortization and accretion		211		212
(Gain) loss on asset disposals, net		4		6
(Gain) loss on license sales and exchanges, net		(17)
Operating income (loss)		82		26
Equity in earnings of unconsolidated entities		32		35
Interest and dividend income		4		3
Interest expense		(42)		(41)
Other, net		1
Income before income taxes		77		23
Income tax expense (benefit)		34		13
Net income		43		10
Depreciation, amortization and accretion		211		212
(Gain) loss on asset disposals, net		4		6
(Gain) loss on license sales and exchanges, net		(17)
Interest expense		42		41
Income tax expense		34		13
Adjusted EBITDA	[1]	317		282
Investments in unconsolidated entities		472		423	$ 451
Total assets		9,349	[2]	9,383	$ 9,446	[2]
Capital expenditures		96		125
U.S. Cellular
Segment Reporting Information [Line Items]
Service	[3]	746		771
Equipment and product sales		190		198
Total operating revenues	[3]	936		969
Cost of services (excluding Depreciation, amortization and accretion reported below)		175		184
Cost of equipment and products		228		256
Selling, general and administrative		339		361
Depreciation, amortization and accretion		153		153
(Gain) loss on asset disposals, net		4		5
(Gain) loss on license sales and exchanges, net		(17)
Operating income (loss)	[3]	54		10
Equity in earnings of unconsolidated entities		33		35
Interest and dividend income	[3]	3		2
Interest expense		(28)		(28)
Other, net		(1)		1
Income before income taxes		61		20
Income tax expense (benefit)	[4]	33		11
Net income		28		9
Depreciation, amortization and accretion		153		153
(Gain) loss on asset disposals, net		4		5
(Gain) loss on license sales and exchanges, net		(17)
Interest expense		28		28
Income tax expense	[4]	33		11
Adjusted EBITDA	[1]	229		206
Investments in unconsolidated entities		434		384
Total assets		7,024		7,057
Capital expenditures		61		79
TDS Telecom
Segment Reporting Information [Line Items]
Service	[3]	256		246
Equipment and product sales		43		35
Total operating revenues	[3]	299		281
Cost of services (excluding Depreciation, amortization and accretion reported below)		107		104
Cost of equipment and products		36		30
Selling, general and administrative		71		71
Depreciation, amortization and accretion		56		58
(Gain) loss on asset disposals, net		1		1
Operating income (loss)	[3]	29		17
Interest and dividend income	[3]	1		1
Interest expense		(1)
Other, net				(1)
Income before income taxes		29		17
Income tax expense (benefit)	[4]	11		7
Net income		18		10
Depreciation, amortization and accretion		56		58
(Gain) loss on asset disposals, net		1		1
Interest expense		1
Income tax expense	[4]	11		7
Adjusted EBITDA	[1]	86		76
Investments in unconsolidated entities		4		4
Total assets		2,077		2,142
Capital expenditures		33		42
TDS Telecom Wireline
Segment Reporting Information [Line Items]
Service	[3]	179		173
Total operating revenues	[3]	179		173
Cost of services (excluding Depreciation, amortization and accretion reported below)		63		62
Cost of equipment and products		1		1
Selling, general and administrative		48		48
Depreciation, amortization and accretion		39		42
Operating income (loss)	[3]	29		20
Interest and dividend income	[3]	1		1
Interest expense				1
Income before income taxes		30		22
Depreciation, amortization and accretion		39		42
Interest expense				(1)
Adjusted EBITDA	[1]	69		63
Investments in unconsolidated entities		4		4
Total assets		1,204		1,291
Capital expenditures		17		27
TDS Telecom Cable
Segment Reporting Information [Line Items]
Service	[3]	49		45
Total operating revenues	[3]	49		45
Cost of services (excluding Depreciation, amortization and accretion reported below)		24		22
Selling, general and administrative		13		12
Depreciation, amortization and accretion		10		9
(Gain) loss on asset disposals, net				1
Operating income (loss)	[3]	2		1
Other, net				(1)
Income before income taxes		2
Depreciation, amortization and accretion		10		9
(Gain) loss on asset disposals, net				1
Adjusted EBITDA	[1]	13		10
Total assets		609		581
Capital expenditures		9		13
TDS Telecom HMS
Segment Reporting Information [Line Items]
Service	[3]	29		29
Equipment and product sales		43		35
Total operating revenues	[3]	71		64
Cost of services (excluding Depreciation, amortization and accretion reported below)		20		21
Cost of equipment and products		36		29
Selling, general and administrative		11		11
Depreciation, amortization and accretion		7		7
Operating income (loss)	[3]	(2)		(4)
Interest expense		(1)		(1)
Income before income taxes		(3)		(5)
Depreciation, amortization and accretion		7		7
Interest expense		1		1
Adjusted EBITDA	[1]	5		3
Total assets		264		270
Capital expenditures		6		2
TDS Telecom Eliminations
Segment Reporting Information [Line Items]
Service	[3]	(1)		(1)
Total operating revenues	[3]	(1)		(1)
Cost of services (excluding Depreciation, amortization and accretion reported below)		(1)		(1)
Corporate, Eliminations and Other
Segment Reporting Information [Line Items]
Service	[3]	(5)		(6)
Equipment and product sales		8		10
Total operating revenues	[3]	3		4
Cost of equipment and products		6		5
Selling, general and administrative		(4)		(1)
Depreciation, amortization and accretion		2		1
(Gain) loss on asset disposals, net		(1)
Operating income (loss)	[3]	(1)		(1)
Equity in earnings of unconsolidated entities		(1)
Interest expense		(13)		(13)
Other, net		2
Income before income taxes		(13)		(14)
Income tax expense (benefit)	[4]	(10)		(5)
Net income		(3)		(9)
Depreciation, amortization and accretion		2		1
(Gain) loss on asset disposals, net		(1)
Interest expense		13		13
Income tax expense	[4]	(10)		(5)
Adjusted EBITDA	[1]	2
Investments in unconsolidated entities		34		35
Total assets		248		184
Capital expenditures		$ 2		$ 4
[1]	Adjusted earnings before interest, taxes, depreciation, amortization and accretion (“Adjusted EBITDA”) is a segment measure reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. Adjusted EBITDA is defined as net income, adjusted for the items set forth in the reconciliation above. TDS believes Adjusted EBITDA is a useful measure of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance.
[2]	The consolidated total assets as of March 31, 2017 and December 31, 2016 include assets held by consolidated VIEs of $763 million and $804 million, respectively, which are not available to be used to settle the obligations of TDS. The consolidated total liabilities as of March 31, 2017 and December 31, 2016 include certain liabilities of consolidated VIEs of $15 million and $17 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of TDS. See Note 8 — Variable Interest Entities for additional information.
[3]	Equipment installment plan interest income is reflected as a component of Service revenues consistent with an accounting policy change effective January 1, 2017. All prior period numbers have been recast to conform to this accounting change. See Note 1 — Basis of Presentation for additional details.
[4]	Income tax expense (benefit) is not provided at the individual segment level for Wireline, Cable and HMS. TDS calculates income tax expense for "TDS Telecom Total".