Document_And_Entity_Informatio
Document And Entity Information (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Jun. 30, 2013 | Jan. 31, 2014 | Jan. 31, 2014 | |
Series A Common Shares | Common Shares | |||
Entity Registrant Name | 'United States Cellular Corporation | ' | ' | ' |
Entity Central Index Key | '0000821130 | ' | ' | ' |
Document Type | '10-K | ' | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' | ' |
Amendment Flag | 'false | ' | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' | ' |
Entity Voluntary Filers | 'No | ' | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' | ' |
Entity Public Float | ' | $475,196,295 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' | ' |
Trading Symbol | 'USM | ' | ' | ' |
Entity Common Stock, Shares Outstanding | ' | ' | 33,006,000 | 51,208,000 |
Consolidated_Statement_Of_Oper
Consolidated Statement Of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating revenues | ' | ' | ' |
Service | $3,594,773 | $4,098,856 | $4,053,797 |
Equipment sales | 324,063 | 353,228 | 289,549 |
Total operating revenues | 3,918,836 | 4,452,084 | 4,343,346 |
Operating expenses | ' | ' | ' |
System operations (excluding Depreciation, amortization and accretion reported below) | 763,435 | 946,805 | 929,379 |
Cost of equipment sold | 999,000 | 935,947 | 791,802 |
Selling, general and administrative (including charges from affiliates of $99.2 million, $104.3 million and $104.1 million in 2013, 2012 and 2011) | 1,677,395 | 1,764,933 | 1,769,701 |
Depreciation, amortization and accretion | 803,781 | 608,633 | 573,557 |
(Gain) loss on asset disposals, net | 30,606 | 18,088 | 9,889 |
(Gain) loss on sale of business and other exit costs, net | -246,767 | 21,022 | ' |
(Gain) loss on license sales and exchanges | -255,479 | ' | -11,762 |
Total operating expenses | 3,771,971 | 4,295,428 | 4,062,566 |
Operating income | 146,865 | 156,656 | 280,780 |
Investment and other income (expense) | ' | ' | ' |
Equity in earnings of unconsolidated entities | 131,949 | 90,364 | 83,566 |
Interest and dividend income | 3,961 | 3,644 | 3,395 |
Gain (loss) on investments | 18,556 | -3,718 | 11,373 |
Interest expense | -43,963 | -42,393 | -65,614 |
Other, net | 288 | 500 | -678 |
Total investment and other income (expense) | 110,791 | 48,397 | 32,042 |
Income before income taxes | 257,656 | 205,053 | 312,822 |
Income tax expense | 113,134 | 63,977 | 114,078 |
Net income | 144,522 | 141,076 | 198,744 |
Less: Net income attributable to noncontrolling interests, net of tax | 4,484 | 30,070 | 23,703 |
Net income attributable to U.S. Cellular shareholders | $140,038 | $111,006 | $175,041 |
Basic weighted average shares outstanding | 83,968 | 84,645 | 84,877 |
Basic earnings per share attributable to U.S. Cellular shareholders | $1.67 | $1.31 | $2.06 |
Diluted weighted average shares outstanding | 84,730 | 85,230 | 85,448 |
Diluted earnings per share attributable to U.S. Cellular shareholders | $1.65 | $1.30 | $2.05 |
Special dividend per share to U.S. Cellular shareholders | $5.75 | ' | ' |
Consolidated_Statement_of_Cash
Consolidated Statement of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities | ' | ' | ' |
Net income | $144,522 | $141,076 | $198,744 |
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities | ' | ' | ' |
Depreciation, amortization and accretion | 803,781 | 608,633 | 573,557 |
Bad debts expense | 98,864 | 67,372 | 62,157 |
Stock-based compensation expense | 15,844 | 21,466 | 20,183 |
Deferred income taxes, net | -75,348 | 49,244 | 203,264 |
Equity in earnings of unconsolidated entities | -131,949 | -90,364 | -83,566 |
Distributions from unconsolidated entities | 125,660 | 84,417 | 91,768 |
(Gain) loss on asset disposals, net | 30,606 | 18,088 | 9,889 |
(Gain) loss on sale of business and other exit costs, net | -246,767 | 21,022 | ' |
(Gain) loss on license sales and exchanges | -255,479 | ' | -11,762 |
(Gain) loss on investments | -18,556 | 3,718 | -11,373 |
Noncash interest expense | 1,059 | -1,822 | 10,040 |
Other operating activities | 646 | 546 | 102 |
Changes in assets and liabilities from operations | ' | ' | ' |
Accounts receivable | -291,759 | -64,816 | -82,175 |
Inventory | -82,422 | -28,786 | -14,640 |
Accounts payable - trade | 85,199 | -4,977 | 28,410 |
Accounts payable - affiliate | 147 | -1,458 | 1,392 |
Customer deposits and deferred revenues | 66,344 | 30,353 | 34,927 |
Accrued taxes | 30,037 | 73,064 | -39,984 |
Accrued interest | 273 | 167 | 225 |
Other assets and liabilities | -9,805 | -27,652 | -3,296 |
Cash flows from operating activities | 290,897 | 899,291 | 987,862 |
Cash flows from investing activities | ' | ' | ' |
Cash used for additions to property, plant and equipment | -717,862 | -826,400 | -771,798 |
Cash paid for aquisitions and licenses | -16,540 | -122,690 | -23,773 |
Cash received from divestitures | 811,120 | 49,932 | ' |
Cash paid for investments | ' | -120,000 | -110,000 |
Cash received for investments | 100,000 | 125,000 | 145,250 |
Other investing activities | -3,969 | -2,453 | 718 |
Cash flows from investing activities | 172,749 | -896,611 | -759,603 |
Cash flows from financing activities | ' | ' | ' |
Repayment of long-term debt | -414 | -145 | -330,338 |
Issuance of long-term debt | ' | ' | 342,000 |
Common shares reissued for benefit plans, net of tax payments | 5,784 | -2,205 | 1,935 |
Common shares repurchased | -18,544 | -20,045 | -62,294 |
Payment of debt issuance costs | -23 | -514 | -11,400 |
Dividends paid | -482,270 | ' | ' |
Distributions to noncontrolling interests | -3,766 | -22,970 | -21,094 |
Payments to acquire additional interest in subsidiaries | -1,005 | -3,167 | ' |
Other financing activities | 299 | 569 | 172 |
Cash flows from financing activities | -499,939 | -48,477 | -81,019 |
Net increase (decrease) in cash and cash equivalents | -36,293 | -45,797 | 147,240 |
Cash and cash equivalents | ' | ' | ' |
Beginning of period | 378,358 | 424,155 | 276,915 |
End of period | $342,065 | $378,358 | $424,155 |
Consolidated_Balance_Sheet
Consolidated Balance Sheet (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets | ' | ' |
Cash and cash equivalents | $342,065 | $378,358 |
Short-term investments | 50,104 | 100,676 |
Accounts receivable | ' | ' |
Customers and agents, less allowances of $59,206 and $24,290, respectively | 467,255 | 349,424 |
Roaming | 30,136 | 31,782 |
Affiliated | 980 | 375 |
Other, less allowances of $1,032 and $2,612, respectively | 88,224 | 63,639 |
Inventory, net | 238,188 | 155,886 |
Income taxes receivable | ' | 1,612 |
Prepaid expenses | 65,596 | 62,560 |
Net deferred income tax asset | 99,105 | 35,419 |
Other current assets | 19,538 | 16,745 |
Total current assets | 1,401,191 | 1,196,476 |
Assets held for sale | 16,027 | 216,763 |
Investments | ' | ' |
Licenses | 1,401,126 | 1,456,794 |
Goodwill | 387,524 | 421,743 |
Investments in unconsolidated entities | 265,585 | 144,531 |
Long-term investments | ' | 50,305 |
Total investments | 2,054,235 | 2,073,373 |
Property, plant and equipment | ' | ' |
In service and under construction | 7,717,512 | 7,478,428 |
Less: Accumulated depreciation | 4,860,992 | 4,455,840 |
Property, plant and equipment, net | 2,856,520 | 3,022,588 |
Other assets and deferred charges | 117,735 | 78,250 |
Total assets | 6,445,708 | 6,587,450 |
Current liabilities | ' | ' |
Current portion of long-term debt | 166 | 92 |
Accounts payable | ' | ' |
Affiliated | 11,243 | 10,725 |
Trade | 405,583 | 310,936 |
Customer deposits and deferred revenues | 256,740 | 192,113 |
Accrued taxes | 73,820 | 35,834 |
Accrued compensation | 66,566 | 90,418 |
Other current liabilities | 192,055 | 114,881 |
Total current liabilities | 1,006,173 | 754,999 |
Liabilities held for sale | ' | 19,594 |
Deferred liabilities and credits | ' | ' |
Net deferred income tax liability | 836,297 | 849,818 |
Other deferred liabilities and credits | 315,073 | 288,441 |
Long-term debt | 878,032 | 878,858 |
Commitments and contingencies | ' | ' |
Noncontrolling interests with redemption features | 536 | 493 |
U.S. Cellular shareholders' equity | ' | ' |
Series A Common and Common Shares | 88,074 | 88,074 |
Additional paid-in capital | 1,424,729 | 1,412,453 |
Treasury Shares at cost | -164,692 | -165,724 |
Retained earnings | 2,043,095 | 2,399,052 |
Total U.S. Cellular shareholders' equity | 3,391,206 | 3,733,855 |
Noncontrolling interests | 18,391 | 61,392 |
Total equity | 3,409,597 | 3,795,247 |
Total liabilities and equity | $6,445,708 | $6,587,450 |
Consolidated_Balance_Sheet_Par
Consolidated Balance Sheet Parenthetical (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
Current assets | ' | ' |
Customers and agents, allowances | $59,206 | $24,290 |
Other, allowances | 1,032 | 2,612 |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 190,000 | 190,000 |
Issued shares | 88,074 | 88,074 |
Outstanding shares | 84,205 | 84,168 |
Par value | 88,074 | 88,074 |
Treasury shares | 3,869 | 3,906 |
Common Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 140,000 | 140,000 |
Issued shares | 55,068 | 55,068 |
Outstanding shares | 51,199 | 51,162 |
Par value per share | $1 | $1 |
Par value | 55,068 | 55,068 |
Treasury shares | 3,869 | 3,906 |
Series A Common Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 50,000 | 50,000 |
Issued shares | 33,006 | 33,006 |
Outstanding shares | 33,006 | 33,006 |
Par value per share | $1 | $1 |
Par value | $33,006 | $33,006 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Equity (USD $) | Total | Series A Common and Common Shares | Additional Paid-In Capital | Treasury Shares | Retained Earnings | Total U.S. Cellular Shareholders' Equity | Noncontrolling Interests |
In Thousands, unless otherwise specified | |||||||
Beginning balance at Dec. 31, 2010 | $3,539,970 | $88,074 | $1,368,487 | ($105,616) | $2,135,507 | $3,486,452 | $53,518 |
Add (Deduct) | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | 175,041 | ' | ' | ' | 175,041 | 175,041 | ' |
Net income attributable to noncontrolling interests classified as equity | 23,532 | ' | ' | ' | ' | ' | 23,532 |
Repurchase of Common Shares | -62,294 | ' | ' | -62,294 | ' | -62,294 | ' |
Incentive and compensation plans | 1,965 | ' | 57 | 15,093 | -13,185 | 1,965 | ' |
Stock-based compensation awards | 20,183 | ' | 20,183 | ' | ' | 20,183 | ' |
Tax windfall (shortfall) from stock awards | -1,386 | ' | -1,386 | ' | ' | -1,386 | ' |
Distributions to noncontrolling interests | -21,094 | ' | ' | ' | ' | ' | -21,094 |
Ending balance at Dec. 31, 2011 | 3,675,917 | 88,074 | 1,387,341 | -152,817 | 2,297,363 | 3,619,961 | 55,956 |
Add (Deduct) | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | 111,006 | ' | ' | ' | 111,006 | 111,006 | ' |
Net income attributable to noncontrolling interests classified as equity | 30,019 | ' | ' | ' | ' | ' | 30,019 |
Repurchase of Common Shares | -20,045 | ' | ' | -20,045 | ' | -20,045 | ' |
Incentive and compensation plans | -2,042 | ' | 137 | 7,138 | -9,317 | -2,042 | ' |
Stock-based compensation awards | 21,249 | ' | 21,249 | ' | ' | 21,249 | ' |
Tax windfall (shortfall) from stock awards | -1,518 | ' | -1,518 | ' | ' | -1,518 | ' |
Distributions to noncontrolling interests | -22,970 | ' | ' | ' | ' | ' | -22,970 |
Adjust investment in subsidiaries for noncontrolling interest purchases | 3,658 | ' | 5,244 | ' | ' | 5,244 | -1,586 |
Other | -27 | ' | ' | ' | ' | ' | -27 |
Ending balance at Dec. 31, 2012 | 3,795,247 | 88,074 | 1,412,453 | -165,724 | 2,399,052 | 3,733,855 | 61,392 |
Add (Deduct) | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | 140,038 | ' | ' | ' | 140,038 | 140,038 | ' |
Net income attributable to noncontrolling interests classified as equity | 4,251 | ' | ' | ' | ' | ' | 4,251 |
Common and Series A Common Shares dividends | -482,270 | ' | ' | ' | -482,270 | -482,270 | ' |
Repurchase of Common Shares | -18,544 | ' | ' | -18,544 | ' | -18,544 | ' |
Incentive and compensation plans | 6,073 | ' | 222 | 19,576 | -13,725 | 6,073 | ' |
Stock-based compensation awards | 15,467 | ' | 15,467 | ' | ' | 15,467 | ' |
Tax windfall (shortfall) from stock awards | -3,267 | ' | -3,267 | ' | ' | -3,267 | ' |
Distributions to noncontrolling interests | -3,576 | ' | ' | ' | ' | ' | -3,576 |
Adjust investment in subsidiaries for noncontrolling interest purchases | -52 | ' | -146 | ' | ' | -146 | 94 |
Deconsolidation of partnerships | -43,770 | ' | ' | ' | ' | ' | -43,770 |
Ending balance at Dec. 31, 2013 | $3,409,597 | $88,074 | $1,424,729 | ($164,692) | $2,043,095 | $3,391,206 | $18,391 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Disclosure Text Block | ' | |||||||||
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | |||||||||
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS | ||||||||||
United States Cellular Corporation (“U.S. Cellular”), a Delaware Corporation, is an 84%-owned subsidiary of Telephone and Data Systems, Inc. (“TDS”). | ||||||||||
Nature of Operations | ||||||||||
U.S. Cellular owns, operates and invests in wireless systems throughout the United States. As of December 31, 2013, U.S. Cellular served 4.8 million customers. U.S. Cellular operates as one reportable segment. | ||||||||||
Principles of Consolidation | ||||||||||
The accounting policies of U.S. Cellular 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”). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of U.S. Cellular, its majority-owned subsidiaries, general partnerships in which U.S. Cellular has a majority partnership interest and variable interest entities (“VIEs”) in which U.S. Cellular is the primary beneficiary. Both VIE and primary beneficiary represent terms defined by GAAP. | ||||||||||
Intercompany accounts and transactions have been eliminated. | ||||||||||
Reclassifications | ||||||||||
Certain prior year amounts have been reclassified to conform to the 2013 financial statement presentation. These reclassifications did not affect consolidated net income attributable to U.S. Cellular shareholders, cash flows, assets, liabilities or equity for the years presented. | ||||||||||
Business Combinations | ||||||||||
U.S. Cellular accounts for business combinations at fair value in accordance with the acquisition method. This method requires that the acquirer recognize 100% of the acquiree's assets and liabilities at their fair values on the acquisition date for all acquisitions, whether full or partial. In addition, transaction costs related to acquisitions are expensed. | ||||||||||
Use of Estimates | ||||||||||
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect (a) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and (b) the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates are involved in accounting for goodwill and indefinite-lived intangible assets, depreciation, amortization and accretion, allowance for doubtful accounts, loyalty reward points, income taxes, stock based compensation and asset retirement obligations. | ||||||||||
Cash and Cash Equivalents | ||||||||||
Cash and cash equivalents include cash and short-term, highly liquid investments with original maturities of three months or less. | ||||||||||
Short-Term and Long-Term Investments | ||||||||||
At December 31, 2013 and 2012, U.S. Cellular had $50.1 million and $100.7 million, respectively, in Short-term investments. At December 31, 2012, U.S. Cellular had $50.3 million in Long-term investments. Short-term and Long-term investments consist primarily of U.S. Treasury Notes which are designated as held-to-maturity investments and are recorded at amortized cost in the Consolidated Balance Sheet. For these investments, U.S. Cellular's objective is to earn a higher rate of return on funds that are not anticipated to be required to meet liquidity needs in the near term, while maintaining a low level of investment risk. See Note 2 — Fair Value Measurements for additional details on Short-term and Long-term investments. | ||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | ||||||||||
Accounts receivable consist primarily of amounts owed by customers for wireless services and equipment sales, by agents for sales of equipment to them and by other wireless carriers whose customers have used U.S. Cellular's wireless systems. | ||||||||||
The allowance for doubtful accounts is the best estimate of the amount of probable credit losses related to existing accounts receivable. The allowance is estimated based on historical experience and other factors that could affect collectability. Accounts receivable balances are reviewed on either an aggregate or individual basis for collectability depending on the type of receivable. When it is probable that an account balance will not be collected, the account balance is charged against the allowance for doubtful accounts. U.S. Cellular does not have any off-balance sheet credit exposure related to its customers. | ||||||||||
The changes in the allowance for doubtful accounts during the years ended December 31, 2013, 2012 and 2011 were as follows: | ||||||||||
2013 | 2012 | 2011 | ||||||||
(Dollars in thousands) | ||||||||||
Beginning balance | $ | 26,902 | $ | 23,537 | $ | 25,816 | ||||
Additions, net of recoveries | 98,864 | 67,372 | 62,157 | |||||||
Deductions | -65,528 | -64,007 | -64,436 | |||||||
Ending balance | $ | 60,238 | $ | 26,902 | $ | 23,537 | ||||
Inventory | ||||||||||
Inventory consists primarily of wireless devices stated at the lower of cost or market, with cost determined using the first-in, first-out method and market determined by replacement costs or estimated net realizable value. | ||||||||||
Fair Value Measurements | ||||||||||
Under the provisions of GAAP, fair value is a market-based measurement and not an entity-specific measurement, based on an exchange transaction in which the entity sells an asset or transfers a liability (exit price). The provisions also 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. | ||||||||||
Goodwill | ||||||||||
U.S. Cellular has Goodwill as a result of its acquisitions of wireless businesses. Such Goodwill represents the excess of the total purchase price over the fair value of net assets acquired in these transactions. | ||||||||||
Licenses | ||||||||||
Licenses consist of direct and incremental costs incurred in acquiring Federal Communications Commission (“FCC”) licenses to provide wireless service. | ||||||||||
U.S. Cellular has determined that wireless licenses are indefinite-lived intangible assets and, therefore, not subject to amortization based on the following factors: | ||||||||||
Radio spectrum is not a depleting asset. | ||||||||||
The ability to use radio spectrum is not limited to any one technology. | ||||||||||
U.S. Cellular and its consolidated subsidiaries are licensed to use radio spectrum through the FCC licensing process, which enables licensees to utilize specified portions of the spectrum for the provision of wireless service. | ||||||||||
U.S. Cellular and its consolidated subsidiaries are required to renew their FCC licenses every ten years or, in some cases, every fifteen years. To date, all of U.S. Cellular's license renewal applications have been granted by the FCC. Generally, license renewal applications filed by licensees otherwise in compliance with FCC regulations are routinely granted. If, however, a license renewal application is challenged either by a competing applicant for the license or by a petition to deny the renewal application, the license will be renewed if the licensee can demonstrate its entitlement to a “renewal expectancy.” Licensees are entitled to such an expectancy if they can demonstrate to the FCC that they have provided “substantial service” during their license term and have “substantially complied” with FCC rules and policies. U.S. Cellular believes that it is probable that its future license renewal applications will be granted. | ||||||||||
Goodwill and Licenses Impairment Assessment | ||||||||||
Goodwill and Licenses must be assessed for impairment annually or more frequently if events or changes in circumstances indicate that such assets might be impaired. U.S. Cellular performs its annual impairment assessment of Goodwill and Licenses as of November 1 of each year. | ||||||||||
U.S. Cellular may first assess qualitative factors, such as company, industry and economic trends to determine whether it is necessary to perform the two-step Goodwill impairment test. If determined to be necessary, the first step compares the fair value of the reporting unit to its carrying value. If the carrying amount exceeds the fair value, the second step of the test is performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of reporting unit Goodwill with the carrying amount of that Goodwill. To calculate the implied fair value of Goodwill in this second step, an enterprise allocates the fair value of the reporting unit to all of the assets and liabilities of that reporting unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value was the price paid to acquire the reporting unit. The excess of the fair value of the reporting unit over the amount assigned to the assets and liabilities of the reporting unit is the implied fair value of Goodwill. If the carrying amount of Goodwill exceeds the implied fair value of Goodwill, an impairment loss is recognized for that difference. | ||||||||||
The impairment test for an indefinite-lived intangible asset other than Goodwill may consist of first assessing qualitative factors, such as company, industry and economic trends. If determined to be necessary, the next step compares the fair value of the intangible asset to its carrying amount. If the carrying amount exceeds the fair value, an impairment loss is recognized for the difference. | ||||||||||
Quoted market prices in active markets are the best evidence of fair value of an intangible asset or reporting unit and are used when available. If quoted market prices are not available, the estimate of fair value is based on the best information available, including prices for similar assets and the use of other valuation techniques. Other valuation techniques include present value analysis, multiples of earnings or revenues, or similar performance measures. The use of these techniques involve assumptions by management about factors that are uncertain including future cash flows, the appropriate discount rate, and other inputs. Different assumptions for these inputs could create materially different results. | ||||||||||
U.S. Cellular tests Goodwill for impairment at the level of reporting referred to as a reporting unit. For purposes of its impairment testing of Goodwill in 2013, U.S. Cellular identified four reporting units. The four reporting units represent four geographic groupings of operating markets, representing four geographic service areas. For purposes of its impairment testing of Goodwill in 2012, U.S. Cellular identified five reporting units. The change in reporting units resulted from the NY1 & NY2 Deconsolidation more fully described in Note 7 — Investments in Unconsolidated Entities. | ||||||||||
A discounted cash flow approach was used to value each reporting unit for purposes of the Goodwill impairment review by using value drivers and risks specific to the current industry and economic markets. The cash flow estimates incorporated assumptions that market participants would use in their estimates of fair value. Key assumptions made in this process were the discount rate, estimated expected revenue growth rate, projected capital expenditures and the terminal growth rate. | ||||||||||
U.S. Cellular tests Licenses for impairment at the level of reporting referred to as a unit of accounting. For purposes of its 2013 impairment testing of Licenses, U.S. Cellular separated its FCC licenses into eleven units of accounting based on geographic service areas. For purposes of its 2012 impairment testing of Licenses, U.S. Cellular separated its FCC licenses into thirteen units of accounting based on geographic service areas. The change in units of accounting resulted from (i) the Divestiture Transaction and the Mississippi Valley non-operating market license sale, both of which are more fully described in Note 5 — Acquisitions, Divestitures and Exchanges and (ii) the NY1 & NY2 Deconsolidation more fully described in Note 7 — Investments in Unconsolidated Entities. In both 2013 and 2012, seven of the units of accounting represented geographic groupings of licenses which, because they were not being utilized and, therefore, were not expected to generate cash flows from operating activities in the foreseeable future, were considered separate units of accounting for purposes of impairment testing. | ||||||||||
U.S. Cellular estimates the fair value of built licenses for purposes of impairment testing using the build-out method. The build-out method estimates the fair value of Licenses by calculating future cash flows from a hypothetical start-up wireless company and assuming that the only assets available upon formation are the underlying Licenses. To apply this method, a hypothetical build-out of U.S. Cellular's wireless network, infrastructure, and related costs are projected based on market participant information. Calculated cash flows, along with a terminal value, are discounted to the present and summed to determine the estimated fair value. | ||||||||||
For units of accounting which consist of unbuilt licenses, U.S. Cellular prepares estimates of fair value by reference to prices paid in recent auctions and market transactions where available. If such information is not available, the fair value of the unbuilt licenses is assumed to change by the same percentage, and in the same direction, that the fair value of built licenses measured using the build-out method changed during the period. | ||||||||||
Investments in Unconsolidated Entities | ||||||||||
Investments in unconsolidated entities consist of amounts invested in wireless entities in which U.S. Cellular holds a noncontrolling interest. U.S. Cellular follows the equity method of accounting for such investments in which its ownership interest is less than or equal to 50% but equals or exceeds 20% for corporations and 3% for partnerships and limited liability companies, or for unconsolidated entities in which its ownership is greater than 50% but U.S. Cellular does not have a controlling financial interest. The cost method of accounting is followed for such investments in which U.S. Cellular's ownership interest is less than 20% for corporations and is less than 3% for partnerships and limited liability companies and for investments for which U.S. Cellular does not have the ability to exercise significant influence. | ||||||||||
For its equity method investments for which financial information is readily available, U.S. Cellular records its equity in the earnings of the entity in the current period. For its equity method investments for which financial information is not readily available, U.S. Cellular records its equity in the earnings of the entity on a one quarter lag basis. | ||||||||||
Property, Plant and Equipment | ||||||||||
U.S. Cellular's Property, plant and equipment is stated at the original cost of construction or purchase including capitalized costs of certain taxes, payroll-related expenses, interest and estimated costs to remove the assets. | ||||||||||
Expenditures that enhance the productive capacity of assets in service or extend their useful lives are capitalized and depreciated. Expenditures for maintenance and repairs of assets in service are charged to System operations expense or Selling, general and administrative expense, as applicable. Retirements and disposals of assets are recorded by removing the original cost of the asset (along with the related accumulated depreciation) from plant in service and charging it, together with net removal costs (removal costs less any applicable accrued asset retirement obligations and salvage value realized), to (Gain) loss on asset disposals, net. | ||||||||||
Costs of developing new information systems are capitalized and amortized over their expected economic useful lives. | ||||||||||
Depreciation | ||||||||||
Depreciation is provided using the straight-line method over the estimated useful life of the assets. | ||||||||||
U.S. Cellular depreciates leasehold improvement assets associated with leased properties over periods ranging from one to thirty years; such periods approximate the shorter of the assets' economic lives or the specific lease terms. | ||||||||||
Useful lives of specific assets are reviewed throughout the year to determine if changes in technology or other business changes would warrant accelerating the depreciation of those specific assets. Due to the Divestiture Transaction more fully described in Note 5 — Acquisitions, Divestitures and Exchanges, U.S. Cellular changed the useful lives of certain assets in 2013 and 2012. Other than the Divestiture Transaction, there were no other material changes to useful lives of property, plant and equipment in 2013, 2012 or 2011. | ||||||||||
Impairment of Long-lived Assets | ||||||||||
U.S. Cellular reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the assets might be impaired. If necessary, the impairment test for tangible long-lived assets is a two-step process. The first step compares the carrying value of the asset (or asset group) with the estimated undiscounted cash flows over the remaining asset (or asset group) life. If the carrying value of the asset (or asset group) is greater than the undiscounted cash flows, the second step of the test is performed to measure the amount of impairment loss. The second step compares the carrying value of the asset to its estimated fair value. If the carrying value exceeds the estimated fair value (less cost to sell), an impairment loss is recognized for the difference. | ||||||||||
U.S. Cellular has one asset group for purposes of assessing property, plant and equipment for impairment based on the fact that the individual operating markets are reliant on centrally operated data centers, mobile telephone switching offices, network operations center and wide-area network. As a result, U.S. Cellular operates a single integrated national wireless network, and the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities represent cash flows generated by this single interdependent network. | ||||||||||
Quoted market prices in active markets are the best evidence of fair value of a tangible long-lived asset and are used when available. If quoted market prices are not available, the estimate of fair value is based on the best information available, including prices for similar assets and the use of other valuation techniques. A present value analysis of cash flow scenarios is often the best available valuation technique. The use of this technique involves assumptions by management about factors that are uncertain including future cash flows, the appropriate discount rate and other inputs. Different assumptions for these inputs could create materially different results. | ||||||||||
Agent Liabilities | ||||||||||
U.S. Cellular has relationships with agents, which are independent businesses that obtain customers for U.S. Cellular. At December 31, 2013 and 2012, U.S. Cellular had accrued $121.3 million and $88.2 million, respectively, for amounts due to agents. This amount is included in Other current liabilities in the Consolidated Balance Sheet. | ||||||||||
Other Assets and Deferred Charges | ||||||||||
Other assets and deferred charges include underwriters' and legal fees and other charges related to issuing U.S. Cellular's various borrowing instruments and other long-term agreements, and are amortized over the respective term of each instrument. The amounts for deferred charges included in the Consolidated Balance Sheet at December 31, 2013 and 2012, are shown net of accumulated amortization of $26.0 million and $12.7 million, respectively. | ||||||||||
Asset Retirement Obligations | ||||||||||
U.S. Cellular operates cell sites, retail stores and office spaces in its operating markets. A majority of these sites, stores and office spaces are leased. Most of these leases contain terms which require or may require U.S. Cellular to return the leased property to its original condition at the lease expiration date. | ||||||||||
U.S. Cellular accounts for asset retirement obligations by recording the fair value of a liability for legal obligations associated with an asset retirement in the period in which the obligations are incurred. At the time the liability is incurred, U.S. Cellular records a liability equal to the net present value of the estimated cost of the asset retirement obligation and increases the carrying amount of the related long-lived asset by an equal amount. The liability is accreted to its present value over a period ending with the estimated settlement date of the respective asset retirement obligation. The carrying amount of the long-lived asset is depreciated over the useful life of the asset. Upon settlement of the obligation, any difference between the cost to retire the asset and the recorded liability (including accretion of discount) is recognized in the Consolidated Statement of Operations. | ||||||||||
Treasury Shares | ||||||||||
Common Shares repurchased by U.S. Cellular are recorded at cost as treasury shares and result in a reduction of equity. Treasury shares are reissued as part of U.S. Cellular's stock-based compensation programs. When treasury shares are reissued, U.S. Cellular determines the cost using the first-in, first-out cost method. The difference between the cost of the treasury shares and reissuance price is included in Additional paid-in capital or Retained earnings. | ||||||||||
Revenue Recognition | ||||||||||
Revenues from wireless operations consist primarily of: | ||||||||||
Charges for access, airtime, roaming, long distance, data and other value added services provided to U.S. Cellular's retail customers and to end users through third-party resellers; | ||||||||||
Charges to carriers whose customers use U.S. Cellular's systems when roaming; | ||||||||||
Sales of equipment and accessories; | ||||||||||
Amounts received from the Universal Service Fund (“USF”) in states where U.S. Cellular has been designated an Eligible Telecommunications Carrier (“ETC”); and | ||||||||||
Redemptions of loyalty reward points for products or services. | ||||||||||
Revenues related to wireless services and other value added services are recognized as services are rendered. Revenues billed in advance or in arrears of the services being provided are estimated and deferred or accrued, as appropriate. | ||||||||||
Revenues from sales of equipment and accessories are recognized when title and risk of loss passes to the agent or end-user customer. | ||||||||||
U.S. Cellular allocates revenue to each element of multiple element service offerings using the relative selling price method. Under this method, arrangement consideration, which consists of the amounts billed to the customer net of any cash-based discounts, is allocated to each element on the basis of its relative selling price on a stand-alone basis. Such stand-alone selling price is determined in accordance with the following hierarchy: | ||||||||||
U.S. Cellular-specific objective evidence of stand-alone selling price, if available; otherwise | ||||||||||
Third-party evidence of selling price, if it is determinable; otherwise | ||||||||||
A best estimate of stand-alone selling price. | ||||||||||
U.S. Cellular estimates stand-alone selling prices of the elements of its service offerings as follows: | ||||||||||
Wireless services – Based on the actual selling price U.S. Cellular offers when such plan is sold on a stand-alone basis, or if the plan is not sold on a stand-alone basis, U.S. Cellular's estimate of the price of such plan based on similar plans that are sold on a stand-alone basis. | ||||||||||
Wireless devices – Based on the selling price of the respective wireless device when it is sold on a stand-alone basis. | ||||||||||
Phone Replacement – Based on U.S. Cellular's estimate of the price of this service if it were sold on a stand-alone basis, which was calculated by estimating the cost of this program plus a reasonable margin. | ||||||||||
Loyalty reward points – By estimating the retail price of the products and services for which points may be redeemed and dividing such amount by the number of loyalty points required to receive such products and services. This is calculated on a weighted average basis and requires U.S. Cellular to estimate the percentage of loyalty points that will be redeemed for each product or service. | ||||||||||
U.S. Cellular follows the deferred revenue method of accounting for its loyalty reward program. Under this method, revenue allocated to loyalty reward points is deferred. Revenue is recognized at the time of customer redemption or when such points have been depleted via an account maintenance charge. U.S. Cellular periodically reviews and revises the redemption and depletion rates as appropriate based on history and related future expectations. As of December 31, 2013, U.S. Cellular estimated loyalty reward points breakage based on actuarial estimates and recorded a $7.4 million change in estimate, which reduced Customer deposits and deferred revenues in the Consolidated Balance Sheet and increased Service revenues in the Consolidated Statement of Operations. | ||||||||||
In the fourth quarter of 2013, U.S. Cellular issued loyalty reward points with a value of $43.5 million as a loyalty bonus in recognition of the inconvenience experienced by customers during U.S. Cellular's recent billing system conversion. The value of the loyalty bonus reduced Service revenues in the Consolidated Statement of Operations and increased Customer deposits and deferred revenues in the Consolidated Balance Sheet. | ||||||||||
As of December 31, 2013 and 2012, U.S. Cellular had deferred revenue related to loyalty reward points outstanding of $116.2 million and $56.6 million, respectively. These amounts are recorded in Customer deposits and deferred revenues (a current liability account) in the Consolidated Balance Sheet, as customers may redeem their reward points within the current period. | ||||||||||
Cash-based discounts and incentives, including discounts to customers who pay their bills through the use of on-line bill payment methods, are recognized as a reduction of Operating revenues concurrently with the associated revenue, and are allocated to the various products and services in the bundled offering based on their respective relative selling price. | ||||||||||
In order to provide better control over wireless device quality, U.S. Cellular sells wireless devices to agents. U.S. Cellular pays rebates to agents at the time an agent activates a new customer or retains an existing customer in a transaction involving a wireless device. U.S. Cellular accounts for these rebates by reducing revenues at the time of the wireless device sale to the agent rather than at the time the agent activates a new customer or retains a current customer. Similarly, U.S. Cellular offers certain wireless device sales rebates and incentives to its retail customers and records the revenue net of the corresponding rebate or incentive. The total potential rebates and incentives are reduced by U.S. Cellular's estimate of rebates that will not be redeemed by customers based on historical experience of such redemptions. | ||||||||||
GAAP requires that activation fees charged with the sale of equipment and service be allocated to the equipment and service based upon the relative selling prices of each item. Device activation fees charged at agent locations, where U.S. Cellular does not also sell a wireless device to the customer, are deferred and recognized over the average device life. Device activation fees charged as a result of handset sales at Company-owned retail stores are recognized at the time the handset is delivered to the customer. | ||||||||||
ETC revenues recognized in the reporting period represent the amounts which U.S. Cellular is entitled to receive for such period, as determined and approved in connection with U.S. Cellular's designation as an ETC in various states. | ||||||||||
Amounts Collected from Customers and Remitted to Governmental Authorities | ||||||||||
U.S. Cellular records amounts collected from customers and remitted to governmental authorities net within a tax liability account if the tax is assessed upon the customer and U.S. Cellular merely acts as an agent in collecting the tax on behalf of the imposing governmental authority. If the tax is assessed upon U.S. Cellular, 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 $114.7 million, $135.7 million and $125.2 million for 2013, 2012 and 2011, respectively. | ||||||||||
Advertising Costs | ||||||||||
U.S. Cellular expenses advertising costs as incurred. Advertising costs totaled $199.9 million, $227.0 million and $257.8 million in 2013, 2012 and 2011, respectively. | ||||||||||
Income Taxes | ||||||||||
U.S. Cellular is included in a consolidated federal income tax return with other members of the TDS consolidated group. TDS and U.S. Cellular are parties to a Tax Allocation Agreement which provides that U.S. Cellular and its subsidiaries be included with the TDS affiliated group in a consolidated federal income tax return and in state income or franchise tax returns in certain situations. For financial statement purposes, U.S. Cellular and its subsidiaries calculate their income, income taxes and credits as if they comprised a separate affiliated group. Under the Tax Allocation Agreement, U.S. Cellular remits its applicable income tax payments to TDS. U.S. Cellular had a tax payable balance with TDS of $34.8 million and $1.1 million as of December 31, 2013 and 2012, respectively. | ||||||||||
Deferred taxes are computed using the liability method, whereby deferred tax assets are recognized for future deductible temporary differences and operating loss carryforwards, and deferred tax liabilities are recognized for future taxable temporary differences. Both deferred tax assets and liabilities are measured using the tax rates anticipated to be in effect when the temporary differences reverse. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. U.S. Cellular evaluates income tax uncertainties, assesses the probability of the ultimate settlement with the applicable taxing authority and records an amount based on that assessment. | ||||||||||
Stock-Based Compensation | ||||||||||
U.S. Cellular has established a long-term incentive plan and a Non-Employee Director compensation plan, and previously had an employee stock purchase plan before this was terminated in the fourth quarter of 2011. Also, U.S. Cellular employees were eligible to participate in the TDS employee stock purchase plan before this was terminated in the fourth quarter of 2011. These plans are described more fully in Note 15 — Stock-based Compensation. These plans are considered compensatory plans and, therefore, recognition of compensation cost for grants made under these plans is required. | ||||||||||
U.S. Cellular values its share-based payment transactions using a Black-Scholes valuation model. Stock-based compensation cost recognized during the period is based on the portion of the share-based payment awards that are ultimately expected to vest. Accordingly, stock-based compensation cost recognized has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Pre-vesting forfeitures and expected life are estimated based on historical experience related to similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. U.S. Cellular believes that its historical experience provides the best estimates of future pre-vesting forfeitures and future expected life. The expected volatility assumption is based on the historical volatility of U.S. Cellular's common stock over a period commensurate with the expected life. The dividend yield assumption is zero because U.S. Cellular has never paid a dividend, except a special cash dividend in June 2013, and has expressed its intention to retain all future earnings in the business. The risk-free interest rate assumption is determined using the U.S. Treasury Yield Curve Rate with a term length that approximates the expected life of the stock options. | ||||||||||
The fair value of options is recognized as compensation cost over the respective requisite service period of the awards, which is generally the vesting period, on a straight-line basis for each separate vesting portion of the awards as if the awards were, in-substance, multiple awards (graded vesting attribution method). | ||||||||||
Defined Contribution Plans | ||||||||||
U.S. Cellular participates in a qualified noncontributory defined contribution pension plan sponsored by TDS; such plan provides pension benefits for the employees of U.S. Cellular and its subsidiaries. Under this plan, pension benefits and costs are calculated separately for each participant and are funded currently. Pension costs were $10.4 million, $12.4 million and $11.6 million in 2013, 2012 and 2011, respectively. | ||||||||||
U.S. Cellular also participates in a defined contribution retirement savings plan (“401(k) plan”) sponsored by TDS. Total costs incurred from U.S. Cellular's contributions to the 401(k) plan were $15.4 million, $17.1 million and $15.5 million in 2013, 2012 and 2011, respectively. | ||||||||||
Operating Leases | ||||||||||
U.S. Cellular is a party to various lease agreements for office space, retail stores, cell sites and equipment that are accounted for as operating leases. Certain leases have renewal options and/or fixed rental increases. Renewal options that are reasonably assured of exercise are included in determining the lease term. U.S. Cellular accounts for certain operating leases that contain rent abatements, lease incentives and/or fixed rental increases by recognizing lease revenue and expense on a straight-line basis over the lease term. | ||||||||||
Recently Issued Accounting Pronouncements | ||||||||||
On July 18, 2013, the FASB issued Accounting Standards Update 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryfoward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). ASU 2013-11 addresses the presentation of an unrecognized tax benefit when a net operating loss carryforward or tax credit carryforward exists. In such event, an unrecognized tax benefit, or portion of an unrecognized tax benefit, would be presented in the Consolidated Balance Sheet as a reduction to deferred tax assets unless the net operating loss carryforward or tax credit carryforward at the reporting date is not available under the tax law of the applicable jurisdiction. U.S. Cellular is required to adopt the provisions of ASU 2013-11 effective January 1, 2014. The adoption of ASU 2013-11 is not expected to have a significant impact on U.S. Cellular's financial position or results of operations. | ||||||||||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Disclosure Text Block | ' | ||||||||||||||
Fair Value Measurements | ' | ||||||||||||||
NOTE 2 FAIR VALUE MEASUREMENTS | |||||||||||||||
As of December 31, 2013 and 2012, U.S. Cellular did not have any financial assets or liabilities that were required to be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. However, U.S. Cellular has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. | |||||||||||||||
31-Dec-13 | 31-Dec-12 | ||||||||||||||
Level within the Fair Value Hierarchy | Book Value | Fair Value | Book Value | Fair Value | |||||||||||
(Dollars in thousands) | |||||||||||||||
Cash and cash equivalents | 1 | $ | 342,065 | $ | 342,065 | $ | 378,358 | $ | 378,358 | ||||||
Short-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | 50,104 | 50,104 | 100,676 | 100,676 | ||||||||||
Long-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | - | - | 50,305 | 50,339 | ||||||||||
Long-term debt | |||||||||||||||
6.95% Senior Notes | 1 | 342,000 | 309,852 | 342,000 | 376,610 | ||||||||||
6.7% Senior Notes | 2 | 532,449 | 507,697 | 532,194 | 582,744 | ||||||||||
Short-term investments are designated as held-to-maturity investments and recorded at amortized cost in the Consolidated Balance Sheet. Long-term debt excludes capital lease obligations and the current portion of Long-term debt. | |||||||||||||||
The fair values of Cash and cash equivalents and Short-term investments approximate their book values due to the short-term nature of these financial instruments. The fair values of Long-term investments were estimated using quoted market prices for the individual issuances. The fair value of Long-term debt was estimated using market prices for the 6.95% Senior Notes, and discounted cash flow analysis using an estimated yield to maturity of 7.35% and 6.09% for the 6.7% Senior Notes at December 31, 2013 and 2012, respectively. | |||||||||||||||
As of December 31, 2013 and 2012, U.S. Cellular did not have nonfinancial assets or liabilities that required the application of fair value accounting for purposes of reporting such amounts in the Consolidated Balance Sheet. | |||||||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Disclosure Text Block | ' | ||||||||||||||||||
Income Taxes | ' | ||||||||||||||||||
NOTE 3 INCOME TAXES | |||||||||||||||||||
U.S. Cellular's income taxes balances at December 31, 2013 and 2012 were as follows: | |||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Federal income taxes (payable) | $ | -32,351 | $ | -1,614 | |||||||||||||||
State income taxes receivable (payable) | -1,545 | 1,612 | |||||||||||||||||
Income tax expense (benefit) is summarized as follows: | |||||||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Current | |||||||||||||||||||
Federal | $ | 180,056 | $ | 10,547 | $ | -90,235 | |||||||||||||
State | 8,426 | 4,186 | 1,049 | ||||||||||||||||
Deferred | |||||||||||||||||||
Federal | -69,917 | 54,490 | 187,581 | ||||||||||||||||
State | -5,431 | -5,246 | 15,683 | ||||||||||||||||
$ | 113,134 | $ | 63,977 | $ | 114,078 | ||||||||||||||
A reconciliation of U.S. Cellular's income tax expense computed at the statutory rate to the reported income tax expense, and the statutory federal income tax expense rate to U.S. Cellular's effective income tax expense rate is as follows: | |||||||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | ||||||||||||||
(Dollars in millions) | |||||||||||||||||||
Statutory federal income tax expense and rate | $ | 90.2 | 35 | % | $ | 71.8 | 35 | % | $ | 109.5 | 35 | % | |||||||
State income taxes, net of federal benefit (1) | 5.2 | 2 | 3.7 | 1.8 | 4.5 | 1.4 | |||||||||||||
Effect of noncontrolling interests | -2.2 | -0.9 | -6.3 | -3.1 | -4.9 | -1.6 | |||||||||||||
Gains (losses) on investments and sale of assets (2) | 20.5 | 8 | - | - | - | - | |||||||||||||
Correction of deferred taxes (3) | - | - | -5.3 | -2.6 | 6.1 | 2 | |||||||||||||
Other differences, net | -0.6 | -0.2 | 0.1 | 0.1 | -1.1 | -0.3 | |||||||||||||
Total income tax expense and rate | $ | 113.1 | 43.9 | % | $ | 64 | 31.2 | % | $ | 114.1 | 36.5 | % | |||||||
-1 | Net state income taxes include changes in the valuation allowance. In addition, state tax benefits related to the settlement of state tax audits and the expiration of statutes of limitations are included in 2013, 2012 and 2011. | ||||||||||||||||||
-2 | Represents 2013 tax expense related to the NY1 & NY2 Deconsolidation and the Divestiture Transaction. | ||||||||||||||||||
-3 | U.S. Cellular recorded immaterial adjustments to correct deferred tax balances in 2012 and 2011 related to tax basis and law changes that related to periods prior to 2012 and 2011, respectively. | ||||||||||||||||||
U.S. Cellular's current Net deferred income tax asset totaled $99.1 million and $35.4 million at December 31, 2013 and 2012, respectively, and primarily represents the deferred tax effects of the deferred revenue for the loyalty reward points, the allowance for doubtful accounts on customer receivables and accrued liabilities. | |||||||||||||||||||
U.S. Cellular’s noncurrent deferred income tax assets and liabilities at December 31, 2013 and 2012 and the temporary differences that gave rise to them were as follows: | |||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Noncurrent deferred tax assets | |||||||||||||||||||
Net operating loss (“NOL”) carryforwards | $ | 61,294 | $ | 63,240 | |||||||||||||||
Stock-based compensation | 19,028 | 22,411 | |||||||||||||||||
Compensation and benefits - other | 3,746 | 13,673 | |||||||||||||||||
Deferred rent | 19,462 | 15,822 | |||||||||||||||||
Other | 24,604 | 25,432 | |||||||||||||||||
128,134 | 140,578 | ||||||||||||||||||
Less valuation allowance | -40,392 | -40,208 | |||||||||||||||||
Total noncurrent deferred tax assets | 87,742 | 100,370 | |||||||||||||||||
Noncurrent deferred tax liabilities | |||||||||||||||||||
Property, plant and equipment | 503,491 | 527,547 | |||||||||||||||||
Licenses/intangibles | 282,764 | 294,738 | |||||||||||||||||
Partnership investments | 133,931 | 124,221 | |||||||||||||||||
Other | 3,853 | 3,682 | |||||||||||||||||
Total noncurrent deferred tax liabilities | 924,039 | 950,188 | |||||||||||||||||
Net noncurrent deferred income tax liability | $ | 836,297 | $ | 849,818 | |||||||||||||||
At December 31, 2013, U.S. Cellular and certain subsidiaries had $1,149.4 million of state NOL carryforwards (generating a $51.1 million deferred tax asset) available to offset future taxable income. The state NOL carryforwards expire between 2014 and 2033. Certain subsidiaries had federal NOL carryforwards (generating a $10.2 million deferred tax asset) available to offset their future taxable income. The federal NOL carryforwards expire between 2018 and 2033. A valuation allowance was established for certain state NOL carryforwards and federal NOL carryforwards since it is more likely than not that a portion of such carryforwards will expire before they can be used. | |||||||||||||||||||
A summary of U.S. Cellular’s deferred tax asset valuation allowance is as follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Balance at January 1, | $ | 41,295 | $ | 30,261 | $ | 29,891 | |||||||||||||
Charged to income tax expense | -1,527 | 3,033 | -1,450 | ||||||||||||||||
Charged to other accounts | 3,607 | 8,001 | 1,820 | ||||||||||||||||
Balance at December 31, | $ | 43,375 | $ | 41,295 | $ | 30,261 | |||||||||||||
As of December 31, 2013, the valuation allowance reduced current deferred tax assets by $3.0 million and noncurrent deferred tax assets by $40.4 million. | |||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Unrecognized tax benefits balance at January 1, | $ | 26,460 | $ | 28,745 | $ | 32,547 | |||||||||||||
Additions for tax positions of current year | 5,925 | 6,656 | 4,487 | ||||||||||||||||
Additions for tax positions of prior years | 1,501 | 854 | 332 | ||||||||||||||||
Reductions for tax positions of prior years | -45 | -115 | -1,104 | ||||||||||||||||
Reductions for settlements of tax positions | -576 | - | -244 | ||||||||||||||||
Reductions for lapses in statutes of limitations | -4,452 | -9,680 | -7,273 | ||||||||||||||||
Unrecognized tax benefits balance at December 31, | $ | 28,813 | $ | 26,460 | $ | 28,745 | |||||||||||||
Unrecognized tax benefits are included in Accrued taxes and Other deferred liabilities and credits in the Consolidated Balance Sheet. If these benefits were recognized, they would have reduced income tax expense in 2013, 2012 and 2011 by $18.7 million, $17.2 million and $18.7 million, respectively, net of the federal benefit from state income taxes. As of December 31, 2013, U.S. Cellular does not expect unrecognized tax benefits to change significantly in the next twelve months. | |||||||||||||||||||
U.S. Cellular recognizes accrued interest and penalties related to unrecognized tax benefits in Income tax expense. The amounts charged to Income tax expense related to interest and penalties resulted in an expense of $0.6 million in 2013, and a benefit of $2.2 million and $2.6 million in 2012 and 2011, respectively. Net accrued interest and penalties were $12.3 million and $12.8 million at December 31, 2013 and 2012, respectively. | |||||||||||||||||||
U.S. Cellular is included in TDS' consolidated federal income tax return. U.S. Cellular also files various state and local income tax returns. The TDS consolidated group remains subject to federal income tax audits for the tax years after 2011. With only a few exceptions, TDS is no longer subject to state income tax audits for years prior to 2009. | |||||||||||||||||||
Earnings_Per_Share
Earnings Per Share | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Disclosure Text Block | ' | |||||||||
Earnings per Share | ' | |||||||||
NOTE 4 EARNINGS PER SHARE | ||||||||||
Basic earnings per share attributable to U.S. Cellular shareholders is computed by dividing Net income attributable to U.S. Cellular shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share attributable to U.S. Cellular shareholders is computed by dividing Net income attributable to U.S. Cellular 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 exercise of outstanding stock options and the vesting of 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: | ||||||||||
Year ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars and shares in thousands, except earnings per share) | ||||||||||
Net income attributable to U.S. Cellular shareholders | $ | 140,038 | $ | 111,006 | $ | 175,041 | ||||
Weighted average number of shares used in basic earnings per share | 83,968 | 84,645 | 84,877 | |||||||
Effect of dilutive securities: | ||||||||||
Stock options | 211 | 184 | 224 | |||||||
Restricted stock units | 551 | 401 | 347 | |||||||
Weighted average number of shares used in diluted earnings per share | 84,730 | 85,230 | 85,448 | |||||||
Basic earnings per share attributable to U.S. Cellular shareholders | $ | 1.67 | $ | 1.31 | $ | 2.06 | ||||
Diluted earnings per share attributable to U.S. Cellular shareholders | $ | 1.65 | $ | 1.3 | $ | 2.05 | ||||
Certain Common Shares issuable upon the exercise of stock options or vesting of restricted stock units were not included in average diluted shares outstanding for the calculation of Diluted earnings per share attributable to U.S. Cellular shareholders because their effects were antidilutive. The number of such Common Shares excluded, if any, is shown in the table below. | ||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Shares in thousands) | ||||||||||
Stock options | 2,010 | 2,123 | 1,591 | |||||||
Restricted stock units | 190 | 369 | 250 | |||||||
On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. Outstanding U.S. Cellular stock options and restricted stock unit awards were equitably adjusted for the special cash dividend. The impact of such adjustments on the earnings per share calculation was fully reflected for all years presented. | ||||||||||
Acquisitions_Divestitures_and_
Acquisitions, Divestitures and Exchanges | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
Disclosure Text Block | ' | ||||||||||||||||||||||
Acquisitions, Divestitures and Exchanges | ' | ||||||||||||||||||||||
NOTE 5 ACQUISITIONS, DIVESTITURES AND EXCHANGES | |||||||||||||||||||||||
U.S. Cellular assesses its existing wireless interests on an ongoing basis with a goal of improving the competitiveness of its operations and maximizing its long-term return on investment. As part of this strategy, U.S. Cellular reviews attractive opportunities to acquire additional operating markets and wireless spectrum. In addition, U.S. Cellular may seek to divest outright or include in exchanges for other wireless interests those interests that are not strategic to its long-term success. | |||||||||||||||||||||||
Acquisitions did not have a material impact on U.S. Cellular's consolidated financial statements for the periods presented and pro forma results, assuming acquisitions had occurred at the beginning of each period presented, would not be materially different from the results reported. | |||||||||||||||||||||||
Divestiture Transaction | |||||||||||||||||||||||
On November 6, 2012, U.S. Cellular entered into a Purchase and Sale Agreement with subsidiaries of Sprint Corp., fka Sprint Nextel Corporation (“Sprint”). Pursuant to the Purchase and Sale Agreement, on May 16, 2013, U.S. Cellular transferred customers and certain PCS license spectrum to Sprint in U.S. Cellular's Chicago, central Illinois, St. Louis and certain Indiana/Michigan/Ohio markets (“Divestiture Markets”) in consideration for $480 million in cash. The Purchase and Sale Agreement also contemplated certain other agreements, together with the Purchase and Sale Agreement collectively referred to as the “Divestiture Transaction.” | |||||||||||||||||||||||
U.S. Cellular retained other assets and liabilities related to the Divestiture Markets, including network assets, retail stores and related equipment, and other buildings and facilities. The transaction did not affect spectrum licenses held by U.S. Cellular or variable interest entities (“VIEs”) that were not used in the operations of the Divestiture Markets. Pursuant to the Purchase and Sale Agreement, U.S. Cellular and Sprint also entered into certain other agreements, including customer and network transition services agreements, which require U.S. Cellular to provide customer, billing and network services to Sprint for a period of up to 24 months after the May 16, 2013 closing date. Sprint will reimburse U.S. Cellular for providing such services at an amount equal to U.S. Cellular's estimated costs, including applicable overhead allocations. In addition, these agreements require Sprint to reimburse U.S. Cellular up to $200 million (the “Sprint Cost Reimbursement”) for certain network decommissioning costs, network site lease rent and termination costs, network access termination costs, and employee termination benefits for specified engineering employees. It is estimated that up to $175 million of the Sprint Cost Reimbursement will be recorded in (Gain) loss on sale of business and other exit costs, net and up to $25 million of the Sprint Cost Reimbursement will be recorded in System operations in the Consolidated Statement of Operations. For the year ended December 31, 2013, $10.6 million of the Sprint Cost Reimbursement had been received and recorded in Cash received from divestitures in the Consolidated Statement of Cash Flows. | |||||||||||||||||||||||
Financial impacts of the Divestiture Transaction are classified in the Consolidated Statement of Operations within Operating income. The table below describes the amounts U.S. Cellular has recognized and expects to recognize in the Consolidated Statement of Operations between the date the Purchase and Sale Agreement was signed and the end of the transition services period. | |||||||||||||||||||||||
(Dollars in thousands) | Expected Period of Recognition | Projected Range | Cumulative Amount Recognized as of December 31, 2013 | Actual Amount Recognized Year Ended December 31, 2013 | Actual Amount Recognized Three Months Ended December 31, 2013 | Actual Amount Recognized Three Months and Year Ended December 31, 2012 | |||||||||||||||||
(Gain) loss on sale of business and other exit costs, net | |||||||||||||||||||||||
Proceeds from Sprint | |||||||||||||||||||||||
Purchase price | 2013 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | - | $ | - | ||||||||||
Sprint Cost Reimbursement | 2013-2014 | -120,000 | -175,000 | -47,641 | -47,641 | -43,420 | - | ||||||||||||||||
Net assets transferred | 2013 | 213,593 | 213,593 | 213,593 | 213,593 | - | - | ||||||||||||||||
Non-cash charges for the write-off and write-down of property under construction and related assets | 2012-2014 | 10,000 | 14,000 | 10,675 | 3 | -51 | 10,672 | ||||||||||||||||
Employee related costs including severance, retention and outplacement | 2012-2014 | 12,000 | 18,000 | 14,262 | 1,653 | -809 | 12,609 | ||||||||||||||||
Contract termination costs | 2012-2014 | 110,000 | 160,000 | 59,584 | 59,525 | 40,744 | 59 | ||||||||||||||||
Transaction costs | 2012-2014 | 5,000 | 6,000 | 5,565 | 4,428 | 347 | 1,137 | ||||||||||||||||
Total (Gain) loss on sale of business and other exit costs, net | $ | -249,407 | $ | -243,407 | $ | -223,962 | $ | -248,439 | $ | -3,189 | $ | 24,477 | |||||||||||
Depreciation, amortization and accretion expense | |||||||||||||||||||||||
Incremental depreciation, amortization and accretion, net of salvage values | 2012-2014 | 200,000 | 225,000 | 198,571 | 178,513 | 44,513 | 20,058 | ||||||||||||||||
(Increase) decrease in Operating income | $ | -49,407 | $ | -18,407 | $ | -25,391 | $ | -69,926 | $ | 41,324 | $ | 44,535 | |||||||||||
Incremental depreciation, amortization and accretion, net of salvage values represents anticipated amounts to be recorded in the specified time periods as a result of a change in estimate for the remaining useful life and salvage value of certain assets and a change in estimate which accelerated the settlement dates of certain asset retirement obligations in conjunction with the Divestiture Transaction. Specifically, for the years indicated, this is estimated depreciation, amortization and accretion recorded on assets and liabilities of the Divestiture Markets after the November 6, 2012 transaction date less depreciation, amortization and accretion that would have been recorded on such assets and liabilities in the normal course, absent the Divestiture Transaction. | |||||||||||||||||||||||
As a result of the transaction, U.S. Cellular recognized the following amounts in the Consolidated Balance Sheet: | |||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||
(Dollars in thousands) | Balance December 31, 2012 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance December 31, 2013 | ||||||||||||||||||
Accrued compensation | |||||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | 12,305 | $ | 6,853 | $ | -11,905 | $ | -5,200 | $ | 2,053 | |||||||||||||
Other current liabilities | |||||||||||||||||||||||
Contract termination costs | $ | 30 | $ | 22,675 | $ | -8,713 | $ | - | $ | 13,992 | |||||||||||||
Other deferred liabilities and credits | |||||||||||||||||||||||
Contract termination costs | $ | - | $ | 34,283 | $ | -3,434 | $ | - | $ | 30,849 | |||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||
(Dollars in thousands) | Balance November 6, 2012 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance December 31, 2012 | ||||||||||||||||||
Accrued compensation | |||||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | - | $ | 12,609 | $ | -304 | $ | - | $ | 12,305 | |||||||||||||
Other current liabilities | |||||||||||||||||||||||
Contract termination costs | $ | - | $ | 59 | $ | -29 | $ | - | $ | 30 | |||||||||||||
-1 | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | ||||||||||||||||||||||
-2 | Adjustment to liability represents changes to previously accrued amounts. | ||||||||||||||||||||||
Other Acquisitions, Divestitures and Exchanges | |||||||||||||||||||||||
On October 4, 2013, U.S. Cellular sold the majority of its Mississippi Valley non-operating market license (“unbuilt license”) for $308.0 million. At the time of the sale, a $250.6 million gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations. | |||||||||||||||||||||||
On August 14, 2013 U.S. Cellular entered into a definitive agreement to sell the majority of its St. Louis area unbuilt license for $92.3 million. This transaction is subject to regulatory approval and is expected to close in the first quarter of 2014. In accordance with GAAP, the book value of the license has been accounted for and disclosed as “held for sale” in the Consolidated Balance Sheet at December 31, 2013. | |||||||||||||||||||||||
On November 20, 2012, U.S. Cellular acquired seven 700 MHz licenses covering portions of Illinois, Michigan, Minnesota, Missouri, Nebraska, Oregon, Washington and Wisconsin for $57.7 million. | |||||||||||||||||||||||
On August 15, 2012, U.S. Cellular acquired four 700 MHz licenses covering portions of Iowa, Kansas, Missouri, Nebraska and Oklahoma for $34.0 million. | |||||||||||||||||||||||
On March 14, 2012, U.S. Cellular sold the majority of the assets and liabilities of a wireless market for $49.8 million in cash. At the time of the sale, a $4.2 million gain was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations. On May 9, 2011, pursuant to certain required terms of the partnership agreement, U.S. Cellular paid $24.6 million in cash to purchase the remaining ownership interest in this wireless market in which it previously held a 49% noncontrolling interest. In connection with the acquisition of the remaining interest, a $13.4 million gain was recorded to adjust the carrying value of this 49% investment to its fair value of $25.7 million based on an income approach valuation method. The gain was recorded in Gain (loss) on investments in the Consolidated Statement of Operations in 2011. | |||||||||||||||||||||||
On September 30, 2011, U.S. Cellular completed an exchange whereby U.S. Cellular received eighteen 700 MHz spectrum licenses covering portions of Idaho, Illinois, Indiana, Kansas, Nebraska, Oregon and Washington in exchange for two PCS spectrum licenses covering portions of Illinois and Indiana. The exchange of licenses provided U.S. Cellular with additional spectrum to meet anticipated future capacity and coverage requirements in several of its markets. No cash, customers, network assets, other assets or liabilities were included in the exchange. As a result of this transaction, U.S. Cellular recognized a gain of $11.8 million, representing the difference between the fair value of the licenses received, calculated using a market approach valuation method, and the carrying value of the licenses surrendered. This gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the year ended December 31, 2011. | |||||||||||||||||||||||
U.S. Cellular acquisitions in 2013 and 2012 and the allocation of the purchase price for these acquisitions were as follows: | |||||||||||||||||||||||
Allocation of Purchase Price | |||||||||||||||||||||||
(Dollars in thousands) | Purchase Price | Goodwill | Licenses | Intangible Assets Subject to Amortization | Net Tangible Assets/(Liabilities) | ||||||||||||||||||
2013 | |||||||||||||||||||||||
Licenses | $ | 16,540 | $ | - | $ | 16,540 | $ | - | $ | - | |||||||||||||
2012 | |||||||||||||||||||||||
Licenses | $ | 122,690 | $ | - | $ | 122,690 | $ | - | $ | - | |||||||||||||
At December 31, 2013 and 2012, the following assets and liabilities were classified in the Consolidated Balance Sheet as "Assets held for sale" and "Liabilities held for sale": | |||||||||||||||||||||||
Current Assets | Licenses | Goodwill | Property, Plant and Equipment | Loss on Assets Held for Sale (1) | Total Assets Held for Sale | Liabilities Held for Sale (2) | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
2013 | |||||||||||||||||||||||
Divestiture of Spectrum Licenses | $ | - | $ | 16,027 | $ | - | $ | - | $ | - | $ | 16,027 | $ | - | |||||||||
2012 | |||||||||||||||||||||||
Divestiture Transaction | $ | - | $ | 140,599 | $ | 72,994 | $ | - | $ | - | $ | 213,593 | $ | 19,594 | |||||||||
Bolingbrook Customer Care Center (3) | - | - | - | 4,275 | -1,105 | 3,170 | - | ||||||||||||||||
Total | $ | - | $ | 140,599 | $ | 72,994 | $ | 4,275 | $ | -1,105 | $ | 216,763 | $ | 19,594 | |||||||||
-1 | Loss on assets held for sale was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations. | ||||||||||||||||||||||
-2 | Liabilities held for sale primarily consisted of Customer deposits and deferred revenues. | ||||||||||||||||||||||
-3 | Effective January 1, 2013, U.S. Cellular transferred its Bolingbrook Customer Care Center operations to an existing third party vendor. |
Intangible_Assets
Intangible Assets | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Disclosure Text Block | ' | ||||||
Intangible Assets | ' | ||||||
NOTE 6 INTANGIBLE ASSETS | |||||||
Changes in U.S. Cellular's Licenses and Goodwill are presented below. See Note 5 — Acquisitions, Divestitures and Exchanges for information regarding transactions which affected Licenses and Goodwill during the periods. | |||||||
Licenses | |||||||
Year Ended December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Balance, beginning of year | $ | 1,456,794 | $ | 1,470,769 | |||
Acquisitions | 16,540 | 122,690 | |||||
Divestitures | -59,419 | - | |||||
Transferred to Assets held for sale | -16,027 | -140,599 | |||||
Other | 3,238 | 3,934 | |||||
Balance, end of year | $ | 1,401,126 | $ | 1,456,794 | |||
Goodwill | |||||||
Year Ended December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Assigned value at time of acquisition | $ | 494,737 | $ | 494,737 | |||
Accumulated impairment losses in prior periods | - | - | |||||
Transferred to Assets held for sale | -72,994 | - | |||||
Balance, beginning of year | 421,743 | 494,737 | |||||
Divestitures | -505 | - | |||||
Transferred to Assets held for sale | - | -72,994 | |||||
NY1 & NY2 Deconsolidation | -33,714 | - | |||||
Balance, end of year | $ | 387,524 | $ | 421,743 |
Investment_in_Unconsolidated_E
Investment in Unconsolidated Entities | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Disclosure Text Block | ' | ||||||||||
Investment in Unconsolidated Entities | ' | ||||||||||
NOTE 7 INVESTMENTS IN UNCONSOLIDATED ENTITIES | |||||||||||
Investments in unconsolidated entities consist of amounts invested in wireless entities in which U.S. Cellular holds a noncontrolling interest. These investments are accounted for using either the equity or cost method as shown in the following table: | |||||||||||
December 31, | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Equity method investments: | |||||||||||
Capital contributions, loans, advances and adjustments | $ | 121,571 | $ | 10,323 | |||||||
Cumulative share of income | 1,152,916 | 1,017,449 | |||||||||
Cumulative share of distributions | -1,010,513 | -884,852 | |||||||||
263,974 | 142,920 | ||||||||||
Cost method investments | 1,611 | 1,611 | |||||||||
Total investments in unconsolidated entities | $ | 265,585 | $ | 144,531 | |||||||
Equity in earnings of unconsolidated entities totaled $131.9 million, $90.4 million and $83.6 million in 2013, 2012 and 2011, respectively; of those amounts, U.S. Cellular's investment in the Los Angeles SMSA Limited Partnership (“LA Partnership”) contributed $78.4 million, $67.2 million and $55.3 million in 2013, 2012 and 2011, respectively. U.S. Cellular held a 5.5% ownership interest in the LA Partnership throughout and at the end of each of these years. | |||||||||||
The following tables, which are based on information provided in part by third parties, summarize the combined assets, liabilities and equity, and the combined results of operations of U.S. Cellular's equity method investments: | |||||||||||
December 31, | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Assets | |||||||||||
Current | $ | 489,659 | $ | 444,100 | |||||||
Due from affiliates | 408,735 | 298,707 | |||||||||
Property and other | 2,026,104 | 1,896,784 | |||||||||
$ | 2,924,498 | $ | 2,639,591 | ||||||||
Liabilities and Equity | |||||||||||
Current liabilities | $ | 351,624 | $ | 350,067 | |||||||
Deferred credits | 84,834 | 80,660 | |||||||||
Long-term liabilities | 19,712 | 21,328 | |||||||||
Long-term capital lease obligations | 707 | 405 | |||||||||
Partners' capital and shareholders' equity | 2,467,621 | 2,187,131 | |||||||||
$ | 2,924,498 | $ | 2,639,591 | ||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||
(Dollars in thousands) | |||||||||||
Results of Operations | |||||||||||
Revenues | $ | 6,218,067 | $ | 5,804,466 | $ | 5,519,024 | |||||
Operating expenses | 4,473,722 | 4,363,399 | 4,282,277 | ||||||||
Operating income | 1,744,345 | 1,441,067 | 1,236,747 | ||||||||
Other income, net | 4,842 | 4,003 | 4,976 | ||||||||
Net income | $ | 1,749,187 | $ | 1,445,070 | $ | 1,241,723 | |||||
NY1 & NY2 Deconsolidation | |||||||||||
U.S. Cellular holds a 60.00% interest in St. Lawrence Seaway RSA Cellular Partnership (“NY1”) and a 57.14% interest in New York RSA 2 Cellular Partnership (“NY2”) (together with NY1, the “Partnerships”). The remaining interests in the Partnerships are held by Cellco Partnership d/b/a Verizon Wireless (“Verizon Wireless”). The Partnerships are operated by Verizon Wireless under the Verizon Wireless brand. Prior to April 3, 2013, because U.S. Cellular owned a greater than 50% interest in each of these Partnerships and based on U.S. Cellular's rights under the Partnership Agreements, U.S. Cellular consolidated the financial results of these Partnerships in accordance with GAAP. | |||||||||||
On April 3, 2013, U.S. Cellular entered into an agreement relating to the Partnerships. The agreement amends the Partnership Agreements in several ways which provide Verizon Wireless with substantive participating rights that allow Verizon Wireless to make decisions that are in the ordinary course of business of the Partnerships and which are significant to directing and executing the activities of the business. Accordingly, as required by GAAP, U.S. Cellular deconsolidated the Partnerships effective as of April 3, 2013 and thereafter reported them as equity method investments in its consolidated financial statements (“NY1 & NY2 Deconsolidation”). After the NY1 & NY2 Deconsolidation, U.S. Cellular retained the same ownership percentages in the Partnerships and will continue to report the same percentages of income from the Partnerships, which will be recorded in Equity in earnings of unconsolidated entities in the Consolidated Statement of Operations. In addition to the foregoing described arrangements, U.S. Cellular has certain other arm's length, ordinary business relationships with Verizon Wireless and its affiliates. | |||||||||||
In accordance with GAAP, as a result of the NY1 & NY2 Deconsolidation, U.S. Cellular's interest in the Partnerships was reflected in Investments in unconsolidated entities at a fair value of $114.8 million as of April 3, 2013. Recording U.S. Cellular's interest in the Partnerships required allocation of the excess of fair value over book value to customer lists, licenses, a favorable contract and goodwill of the Partnerships. Amortization expense related to customer lists and the favorable contract will be recognized over their respective useful lives and is included in Equity in earnings of unconsolidated entities in the Consolidated Statement of Operations. In addition, U.S. Cellular recognized a non-cash pre-tax gain of $18.5 million in the second quarter of 2013. The gain was recorded in Gain (loss) on investments in the Consolidated Statement of Operations. | |||||||||||
The Partnerships were valued using a discounted cash flow approach and a publicly-traded guideline company method. The discounted cash flow approach uses value drivers and risks specific to the industry and current economic factors and incorporates assumptions that market participants would use in their estimates of fair value and may not be indicative of U.S. Cellular specific assumptions. The most significant assumptions made in this process were the revenue growth rate (shown as a simple average in the table below), the terminal revenue growth rate, discount rate and capital expenditures. The assumptions were as follows: | |||||||||||
Key assumptions | |||||||||||
Average expected revenue growth rate (next ten years) | 2 | % | |||||||||
Terminal revenue growth rate (after year ten) | 2 | % | |||||||||
Discount rate | 10.5 | % | |||||||||
Capital expenditures as a percentage of revenue | 14.9-18.8 | % | |||||||||
The publicly-traded guideline company method develops an indication of fair value by calculating average market pricing multiples for selected publicly-traded companies using multiples of: Revenue and Earnings before Interest, Taxes, and Depreciation and Amortization (EBITDA). The developed multiples were applied to applicable financial measures of the Partnerships to determine fair value. The discounted cash flow approach and publicly-traded guideline company method were weighted to arrive at the total fair value of the Partnerships. | |||||||||||
Property_Plant_and_Equipment
Property, Plant and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Disclosure Text Block | ' | ||||||||
Property, Plant and Equipment | ' | ||||||||
NOTE 8 PROPERTY, PLANT AND EQUIPMENT | |||||||||
Property, plant and equipment in service and under construction, and related accumulated depreciation and amortization, as of December 31, 2013 and 2012 were as follows: | |||||||||
December 31, | Useful Lives (Years) | 2013 | 2012 | ||||||
(Dollars in thousands) | |||||||||
Land | N/A | $ | 36,266 | $ | 33,947 | ||||
Buildings | 20 | 304,272 | 341,852 | ||||||
Leasehold and land improvements | 30-Jan | 1,197,520 | 1,188,720 | ||||||
Cell site equipment | 25-Jun | 3,306,575 | 3,100,916 | ||||||
Switching equipment | 8-Jan | 1,161,976 | 1,155,114 | ||||||
Office furniture and equipment | 5-Mar | 539,248 | 535,656 | ||||||
Other operating assets and equipment | 25-May | 92,456 | 128,290 | ||||||
System development | 7-Mar | 962,698 | 631,184 | ||||||
Work in process | N/A | 116,501 | 362,749 | ||||||
7,717,512 | 7,478,428 | ||||||||
Accumulated depreciation and amortization | -4,860,992 | -4,455,840 | |||||||
$ | 2,856,520 | $ | 3,022,588 | ||||||
Depreciation and amortization expense totaled $791.1 million, $597.7 million and $565.1 million in 2013, 2012 and 2011, respectively. As a result of the Divestiture Transaction, U.S. Cellular recognized incremental depreciation and amortization in 2012 and 2013. See Note 5 — Acquisitions, Divestitures and Exchanges for additional information. | |||||||||
In 2013, 2012 and 2011, (Gain) loss on asset disposals, net included charges of $30.6 million, $18.1 million and $9.9 million, respectively, related to disposals of assets, trade-ins of older assets for replacement assets and other retirements of assets from service in the normal course of business. | |||||||||
Asset_Retirement_Obligation
Asset Retirement Obligation | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Disclosure Text Block | ' | |||||||
Asset Retirement Obligation | ' | |||||||
NOTE 9 ASSET RETIREMENT OBLIGATIONS | ||||||||
U.S. Cellular is subject to asset retirement obligations associated with its leased cell sites, switching office sites, retail store sites and office locations in its operating markets. Asset retirement obligations generally include obligations to restore leased land and retail store and office premises to their pre-lease conditions. These obligations are included in Other deferred liabilities and credits and Other current liabilities in the Consolidated Balance Sheet. | ||||||||
In 2013 and 2012, U.S. Cellular performed a review of the assumptions and estimated costs related to its asset retirement obligations. The results of the reviews (identified as “Revisions in estimated cash outflows”) and other changes in asset retirement obligations during 2013 and 2012, including the Divestiture Transaction, were as follows: | ||||||||
(Dollars in thousands) | 2013 | 2012 | ||||||
Balance, beginning of period | $ | 179,607 | $ | 143,402 | ||||
Additional liabilities accrued | 635 | 5,578 | ||||||
Revisions in estimated cash outflows (1) | 6,268 | 22,588 | ||||||
Disposition of assets (2) | -3,534 | -2,674 | ||||||
Accretion expense (3) | 12,592 | 10,713 | ||||||
Balance, end of period (4) | $ | 195,568 | $ | 179,607 | ||||
-1 | Included increases of $14.9 million as a result of changes in expected settlement dates related to the Divestiture Transaction in 2012. | |||||||
-2 | Included $2.0 million of incremental disposition costs related to the Divestiture Transaction in 2013. | |||||||
-3 | Included $1.1 million and $0.2 million of incremental accretion related to the Divestiture Transaction in 2013 and 2012, respectively. | |||||||
-4 | In 2013, as a result of the accelerated settlement dates of certain asset retirement obligations related to the Divestiture Transaction, U.S. Cellular reclassified $37.7 million of its asset retirement obligations from Other deferred liabilities and credits to Other current liabilities. |
Debt
Debt | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Disclosure Text Block | ' | |||||||||||||||
Debt | ' | |||||||||||||||
NOTE 10 DEBT | ||||||||||||||||
Revolving Credit Facility | ||||||||||||||||
At December 31, 2013, U.S. Cellular had a revolving credit facility available for general corporate purposes. Amounts under the revolving credit facility may be borrowed, repaid and reborrowed from time to time until maturity. U.S. Cellular did not borrow under its current or previous revolving credit facilities in 2013, 2012 or 2011 except for letters of credit. | ||||||||||||||||
U.S. Cellular's interest cost on its revolving credit facility is subject to increase if its current credit ratings from nationally recognized credit rating agencies is lowered, and is subject to decrease if the ratings are raised. The credit facility would not cease to be available nor would the maturity date accelerate solely as a result of a downgrade in U.S. Cellular's credit rating. However, a downgrade in U.S. Cellular's credit rating could adversely affect its ability to renew the credit facilities or obtain access to other credit facilities in the future. | ||||||||||||||||
The maturity date of any borrowings under the U.S. Cellular revolving credit facility would accelerate in the event of a change in control. | ||||||||||||||||
The following table summarizes the terms of the revolving credit facility as of December 31, 2013: | ||||||||||||||||
(Dollars in millions) | ||||||||||||||||
Maximum borrowing capacity | $ | 300 | ||||||||||||||
Letters of credit outstanding (1) | $ | 17.6 | ||||||||||||||
Amount borrowed | $ | - | ||||||||||||||
Amount available for use | $ | 282.4 | ||||||||||||||
Borrowing rate: One-month London Interbank Offered Rate ("LIBOR") plus contractual spread (2) | 1.67 | % | ||||||||||||||
LIBOR | 0.17 | % | ||||||||||||||
Contractual spread | 1.5 | % | ||||||||||||||
Range of commitment fees on amount available for use (3) | ||||||||||||||||
Low | 0.13 | % | ||||||||||||||
High | 0.3 | % | ||||||||||||||
Agreement date | Dec-10 | |||||||||||||||
Maturity date | Dec-17 | |||||||||||||||
Fees incurred attributable to the Revolving Credit Facility are as follows: | ||||||||||||||||
Fees incurred as a percent of Maximum borrowing capacity for 2013 | 0.25 | % | ||||||||||||||
Fees incurred, amount | ||||||||||||||||
2013 | $ | 0.8 | ||||||||||||||
2012 | $ | 1.1 | ||||||||||||||
2011 | $ | 1.2 | ||||||||||||||
-1 | In June 2013, U.S. Cellular provided $17.4 million in letters of credit to the FCC in connection with U.S. Cellular's winning bids in Auction 901. See Note 16 — Supplemental Cash Flow Disclosures for additional information on Auction 901. | |||||||||||||||
-2 | Borrowings under the revolving credit facility bear interest at LIBOR plus a contractual spread based on U.S. Cellular’s credit rating or, at U.S. Cellular’s option, an alternate “Base Rate” as defined in the revolving credit agreement. U.S. Cellular may select a borrowing period of either one, two, three or six months (or other period of twelve months or less if requested by U.S. Cellular and approved by the lenders). If U.S. Cellular provides notice of intent to borrow less than three business days in advance of a borrowing, interest on borrowing is at the Base Rate plus the contractual spread. | |||||||||||||||
-3 | The revolving credit facility has commitment fees based on the unsecured senior debt ratings assigned to U.S. Cellular by certain ratings agencies. | |||||||||||||||
The continued availability of the revolving credit facility requires U.S. Cellular to comply with certain negative and affirmative covenants, maintain certain financial ratios and make representations regarding certain matters at the time of each borrowing. U.S. Cellular believes it was in compliance as of December 31, 2013 with all covenants and other requirements set forth in the revolving credit facility. | ||||||||||||||||
In connection with U.S. Cellular's revolving credit facility, TDS and U.S. Cellular entered into a subordination agreement dated December 17, 2010 together with the administrative agent for the lenders under U.S. Cellular's revolving credit agreement. Pursuant to this subordination agreement, (a) any consolidated funded indebtedness from U.S. Cellular to TDS will be unsecured and (b) any (i) consolidated funded indebtedness from U.S. Cellular to TDS (other than “refinancing indebtedness” as defined in the subordination agreement) in excess of $105,000,000, and (ii) refinancing indebtedness in excess of $250,000,000, will be subordinated and made junior in right of payment to the prior payment in full of obligations to the lenders under U.S. Cellular's revolving credit agreement. As of December 31, 2013, U.S. Cellular had no outstanding consolidated funded indebtedness or refinancing indebtedness that was subordinated to the revolving credit agreement pursuant to the subordination agreement. | ||||||||||||||||
At December 31, 2013, U.S. Cellular had recorded $2.7 million of issuance costs related to the revolving credit facility which is included in Other assets and deferred charges in the Consolidated Balance Sheet. | ||||||||||||||||
Long-Term Debt | ||||||||||||||||
Long-term debt as of December 31, 2013 and 2012 was as follows: | ||||||||||||||||
December 31, | ||||||||||||||||
(Dollars in thousands) | Issuance date | Maturity date | Call date | 2013 | 2012 | |||||||||||
Unsecured Senior Notes | ||||||||||||||||
6.70% | December 2003 and June 2004 | Dec-33 | Dec-03 | $ | 544,000 | $ | 544,000 | |||||||||
Less: 6.7% Unamortized discount | -11,551 | -11,806 | ||||||||||||||
532,449 | 532,194 | |||||||||||||||
6.95% | May-11 | May-60 | May-16 | 342,000 | 342,000 | |||||||||||
Obligation on capital leases | 3,749 | 4,756 | ||||||||||||||
Total long-term debt | $ | 878,198 | $ | 878,950 | ||||||||||||
Long-term debt, current | $ | 166 | $ | 92 | ||||||||||||
Long-term debt, noncurrent | $ | 878,032 | $ | 878,858 | ||||||||||||
U.S. Cellular may redeem the 6.7% Senior Notes, in whole or in part, at any time prior to maturity at a redemption price equal to the greater of (a) 100% of the principal amount of such notes, plus accrued and unpaid interest, or (b) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date on a semi-annual basis at the Treasury Rate plus 30 basis points. U.S. Cellular may redeem the 6.95% Senior Notes, in whole or in part at any time after the call date, at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest. | ||||||||||||||||
Interest on the 6.7% Senior Notes is payable semi-annually, and on the 6.95% Senior Notes is payable quarterly. | ||||||||||||||||
Capitalized debt issuance costs for Unsecured Senior Notes totaled $16.3 million and are included in Other assets and deferred charges (a long-term asset account). These costs are amortized over the life of the notes using the effective interest method. | ||||||||||||||||
U.S. Cellular does not have any annual requirements for principal payments on long-term debt over the next five years (excluding capital lease obligations). | ||||||||||||||||
The covenants associated with U.S. Cellular's long-term debt obligations, among other things, restrict U.S. Cellular's ability, subject to certain exclusions, to incur additional liens, enter into sale and leaseback transactions, and sell, consolidate or merge assets. | ||||||||||||||||
U.S. Cellular's long-term debt indentures do not contain any provisions resulting in acceleration of the maturities of outstanding debt in the event of a change in U.S. Cellular's credit rating. However, a downgrade in U.S. Cellular's credit rating could adversely affect its ability to obtain long-term debt financing in the future. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Disclosure Text Block | ' | |||||
Commitments and Contingencies | ' | |||||
NOTE 11 COMMITMENTS AND CONTINGENCIES | ||||||
Agreements | ||||||
As previously disclosed, on August 17, 2010, U.S. Cellular and Amdocs Software Systems Limited (“Amdocs”) entered into a Software License and Maintenance Agreement (“SLMA”) and a Master Service Agreement (“MSA”) (collectively, the “Amdocs Agreements”) to develop a Billing and Operational Support System (“B/OSS”). In July 2013, U.S. Cellular implemented B/OSS, pursuant to an updated Statement of Work dated June 29, 2012. Total payments to Amdocs related to this implementation are estimated to be approximately $183.9 million (subject to certain potential adjustments) over the period from commencement of the SLMA through the first half of 2014. As of December 31, 2013, $136.8 million had been paid to Amdocs. | ||||||
Lease Commitments | ||||||
U.S. Cellular is a party to various lease agreements, both as lessee and lessor, for office space, retail store sites, cell sites and equipment which are accounted for as operating leases. Certain leases have renewal options and/or fixed rental increases. Renewal options that are reasonably assured of exercise are included in determining the lease term. Any rent abatements or lease incentives, in addition to fixed rental increases, are included in the calculation of rent expense and calculated on a straight-line basis over the defined lease term. | ||||||
As of December 31, 2013, future minimum rental payments required under operating leases and rental receipts expected under operating leases that have noncancellable lease terms in excess of one year were as follows: | ||||||
Operating Leases Future Minimum Rental Payments | Operating Leases Future Minimum Rental Receipts | |||||
(Dollars in thousands) | ||||||
2014 | $ | 152,349 | $ | 46,357 | ||
2015 | 134,852 | 36,847 | ||||
2016 | 116,397 | 26,201 | ||||
2017 | 97,098 | 17,226 | ||||
2018 | 79,166 | 6,521 | ||||
Thereafter | 783,730 | 227 | ||||
Total | $ | 1,363,592 | $ | 133,379 | ||
Rent expense totaled $162.1 million, $183.9 million and $171.6 million in 2013, 2012 and 2011, respectively. | ||||||
Rent revenue totaled $45.7 million, $41.7 million and $39.2 million in 2013, 2012 and 2011, respectively. | ||||||
Indemnifications | ||||||
U.S. Cellular enters into agreements in the normal course of business that provide for indemnification of counterparties. The terms of the indemnifications vary by agreement. The events or circumstances that would require U.S. Cellular to perform under these indemnities are transaction specific; however, these agreements may require U.S. Cellular to indemnify the counterparty for costs and losses incurred from litigation or claims arising from the underlying transaction. U.S. Cellular is unable to estimate the maximum potential liability for these types of indemnifications as the amounts are dependent on the outcome of future events, the nature and likelihood of which cannot be determined at this time. Historically, U.S. Cellular has not made any significant indemnification payments under such agreements. | ||||||
Legal Proceedings | ||||||
U.S. Cellular is involved or may be involved from time to time in legal proceedings before the FCC, other regulatory authorities, and/or various state and federal courts. If U.S. Cellular believes that a loss arising from such legal proceedings is probable and can be reasonably estimated, an amount is accrued in the financial statements for the estimated loss. If only a range of loss can be determined, the best estimate within that range is accrued; if none of the estimates within that range is better than another, the low end of the range is accrued. The assessment of the expected outcomes of legal proceedings is a highly subjective process that requires judgments about future events. The legal proceedings are reviewed at least quarterly to determine the adequacy of accruals and related financial statement disclosures. The ultimate outcomes of legal proceedings could differ materially from amounts accrued in the financial statements. | ||||||
U.S. Cellular has accrued $0.3 million and $1.7 million with respect to legal proceedings and unasserted claims as of December 31, 2013 and 2012, respectively. U.S. Cellular has not accrued any amount for legal proceedings if it cannot estimate the amount of the possible loss or range of loss. U.S. Cellular does not believe that the amount of any contingent loss in excess of the amounts accrued would be material. | ||||||
Apple iPhone Products Purchase Commitment | ||||||
In March 2013, U.S. Cellular entered into an agreement with Apple to purchase certain minimum quantities of Apple iPhone products over a three-year period beginning in November 2013. Based on current forecasts, U.S. Cellular estimates that the remaining contractual purchase commitment as of December 31, 2013 is approximately $950 million. At this time, U.S. Cellular expects to meet its contractual commitment with Apple. |
Variable_Interest_Entities
Variable Interest Entities | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Disclosure Text Block | ' | ||||||
Variable Interest Entities | ' | ||||||
NOTE 12 VARIABLE INTEREST ENTITIES (VIEs) | |||||||
U.S. Cellular consolidates variable interest entities in which it has a controlling financial interest and is 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. U.S. Cellular reviews these criteria initially at the time it enters into agreements and subsequently when reconsideration events occur. | |||||||
Consolidated VIEs | |||||||
As of December 31, 2013, U.S. Cellular holds a variable interest in and consolidates the following VIEs under GAAP: | |||||||
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. | |||||||
The power to direct the activities that most significantly impact the economic performance of Aquinas Wireless and King Street Wireless (collectively, the “limited partnerships”) 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; however, the general partner of each partnership needs consent of the limited partner, a U.S. Cellular 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 the VIEs is shared, U.S. Cellular has a disproportionate level of exposure to the variability associated with the economic performance of the VIEs, indicating that U.S. Cellular is the primary beneficiary of the VIEs in accordance with GAAP. Accordingly, these VIEs are consolidated. | |||||||
The following table presents the classification of the consolidated VIEs' assets and liabilities in U.S. Cellular's Consolidated Balance Sheet. | |||||||
December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Assets | |||||||
Cash and cash equivalents | $ | 2,076 | $ | 5,849 | |||
Other current assets | 1,184 | 120 | |||||
Licenses | 310,475 | 308,091 | |||||
Property, plant and equipment, net | 18,600 | 16,443 | |||||
Other assets and deferred charges | 511 | 887 | |||||
Total assets | $ | 332,846 | $ | 331,390 | |||
Liabilities | |||||||
Current liabilities | $ | 46 | $ | 1,013 | |||
Deferred liabilities and credits | 3,139 | 3,024 | |||||
Total liabilities | $ | 3,185 | $ | 4,037 | |||
Other Related Matters | |||||||
Aquinas Wireless and King Street Wireless 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. As such, these entities have risks similar to those described in the “Risk Factors” in U.S. Cellular's Annual Report on Form 10-K. | |||||||
U.S. Cellular may agree to make additional capital contributions and/or advances to Aquinas Wireless and King Street Wireless and/or to their general partners to provide additional funding for the development of licenses granted in various auctions. U.S. Cellular may finance such amounts with a combination of cash on hand, borrowings under its revolving credit agreement and/or long-term debt. There is no assurance that U.S. Cellular will be able to obtain additional financing on commercially reasonable terms or at all to provide such financial support. | |||||||
The limited partnership agreements of Aquinas Wireless and King Street Wireless also provide the general partner with a put option whereby the general partner may require the limited partner, a subsidiary of U.S. Cellular, to purchase its interest in the limited partnership. The general partner's put options related to its interests in King Street Wireless and Aquinas Wireless will become exercisable in 2019 and 2020, respectively. The put option price is determined pursuant to a formula that takes into consideration fixed interest rates and the market value of U.S. Cellular's Common Shares. Upon exercise of the put option, the general partner is required to repay borrowings due to U.S. Cellular. If the general partner does not elect to exercise its put option, the general partner may trigger an appraisal process in which the limited partner (a subsidiary of U.S. Cellular) may have the right, but not the obligation, to purchase the general partner's interest in the limited partnership at a price and on other terms and conditions specified in the limited partnership agreement. In accordance with requirements under GAAP, U.S. Cellular is required to calculate a theoretical redemption value for all of the put options assuming they are exercisable at the end of each reporting period, even though such exercise is not contractually permitted. Pursuant to GAAP, this theoretical redemption value, net of amounts payable to U.S. Cellular for loans and accrued interest thereon made by U.S. Cellular to the general partners the (“net put value”), was $0.5 million at December 31, 2013 and 2012, respectively. The net put value is recorded as Noncontrolling interests with redemption features in U.S. Cellular's Consolidated Balance Sheet. Also in accordance with GAAP, changes in the redemption value of the put options, net of interest accrued on the loans, are recorded as a component of Net income attributable to noncontrolling interests, net of tax, in U.S. Cellular's Consolidated Statements of Operations. | |||||||
U.S. Cellular's capital contributions and advances made to Aquinas Wireless and King Street Wireless and/or their general partners totaled $10.0 million in the year ended December 31, 2012. There were no capital contributions or advances made to Aquinas Wireless or King Street Wireless or their general partners in 2013. | |||||||
U.S. Cellular currently provides 4G LTE service in conjunction with King Street Wireless. Aquinas Wireless is still in the process of developing long-term business plans. | |||||||
Noncontrolling_Interests
Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2013 | |
Disclosure Text Block | ' |
Noncontrolling Interests | ' |
NOTE 13 NONCONTROLLING INTERESTS | |
U.S. Cellular's consolidated financial statements include certain noncontrolling interests that meet the GAAP definition of mandatorily redeemable financial instruments. These mandatorily redeemable noncontrolling interests represent interests held by third parties in consolidated partnerships and limited liability companies (“LLCs”), where the terms of the underlying partnership or LLC agreement provide for a defined termination date at which time the assets of the subsidiary are to be sold, the liabilities are to be extinguished and the remaining net proceeds are to be distributed to the noncontrolling interest holders and U.S. Cellular in accordance with the respective partnership and LLC agreements. The termination dates of these mandatorily redeemable noncontrolling interests range from 2085 to 2107. | |
The estimated aggregate amount that would be due and payable to settle all of these noncontrolling interests assuming an orderly liquidation of the finite-lived consolidated partnerships and LLCs on December 31, 2013, net of estimated liquidation costs, is $24.8 million. This amount excludes redemption amounts recorded in Noncontrolling interests with redemption features in the Consolidated Balance Sheet. The estimate of settlement value was based on certain factors and assumptions which are subjective in nature. Changes in those factors and assumptions could result in a materially larger or smaller settlement amount. U.S. Cellular currently has no plans or intentions relating to the liquidation of any of the related partnerships or LLCs prior to their scheduled termination dates. The corresponding carrying value of the mandatorily redeemable noncontrolling interests in finite-lived consolidated partnerships and LLCs at December 31, 2013 was $15.4 million, and is included in Noncontrolling interests in the Consolidated Balance Sheet. The excess of the aggregate settlement value over the aggregate carrying value of these mandatorily redeemable noncontrolling interests is due primarily to the unrecognized appreciation of the noncontrolling interest holders' share of the underlying net assets in the consolidated partnerships and LLCs. Neither the noncontrolling interest holders' share, nor U.S. Cellular's share, of the appreciation of the underlying net assets of these subsidiaries is reflected in the consolidated financial statements. |
Common_Shareholders_Equity
Common Shareholders' Equity | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Disclosure Text Block | ' | ||||||||||
Common Shareholders' Equity | ' | ||||||||||
NOTE 14 COMMON SHAREHOLDERS' EQUITY | |||||||||||
Tax-Deferred Savings Plan | |||||||||||
U.S. Cellular has reserved 67,215 Common Shares for issuance under the TDS Tax-Deferred Savings Plan, a qualified profit-sharing plan pursuant to Sections 401(a) and 401(k) of the Internal Revenue Code. Participating employees have the option of investing their contributions in a U.S. Cellular Common Share fund, a TDS Common Share fund or certain unaffiliated funds. | |||||||||||
Series A Common Shares | |||||||||||
Series A Common Shares are convertible on a share-for-share basis into Common Shares. In matters other than the election of directors, each Series A Common Share is entitled to ten votes per share, compared to one vote for each Common Share. The Series A Common Shares are entitled to elect 75% of the directors (rounded down), and the Common Shares elect 25% of the directors (rounded up). As of December 31, 2013, a majority of U.S. Cellular's outstanding Common Shares and all of U.S. Cellular's outstanding Series A Common Shares were held by TDS. | |||||||||||
Common Share Repurchase Program | |||||||||||
On November 17, 2009, the Board of Directors of U.S. Cellular authorized the repurchase of up to 1,300,000 Common Shares on an annual basis beginning in 2009 and continuing each year thereafter, on a cumulative basis. These purchases will be made pursuant to open market purchases, block purchases, private purchases, or otherwise, depending on market prices and other conditions. This authorization does not have an expiration date. | |||||||||||
Share repurchases made under this authorization were as follows: | |||||||||||
Year Ended December 31, | Number of Shares | Average Cost Per Share | Total Cost | ||||||||
(Dollar amounts and shares in thousands) | |||||||||||
2013 | |||||||||||
U.S. Cellular Common Shares | 499 | $ | 37.19 | $ | 18,544 | ||||||
2012 | |||||||||||
U.S. Cellular Common Shares | 571 | $ | 35.11 | $ | 20,045 | ||||||
2011 | |||||||||||
U.S. Cellular Common Shares | 1,276 | $ | 48.82 | $ | 62,294 | ||||||
Pursuant to certain employee and non-employee benefit plans, U.S. Cellular reissued 535,578, 182,195, and 286,211 Treasury Shares in 2013, 2012 and 2011, respectively. | |||||||||||
Dividend | |||||||||||
On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. | |||||||||||
Stock_Based_Compensation
Stock Based Compensation | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Disclosure Text Block | ' | ||||||||||||||
Stock Based Compensation | ' | ||||||||||||||
NOTE 15 STOCK-BASED COMPENSATION | |||||||||||||||
U.S. Cellular has established the following stock-based compensation plans: long-term incentive plans and a Non-Employee Director compensation plan, and had an employee stock purchase plan that was terminated in the fourth quarter of 2011. In addition, U.S. Cellular employees were eligible to participate in the TDS employee stock purchase plan before that plan also was terminated in the fourth quarter of 2011. | |||||||||||||||
Under the U.S. Cellular Long-Term Incentive Plans, U.S. Cellular may grant fixed and performance based incentive and non-qualified stock options, restricted stock, restricted stock units, and deferred compensation stock unit awards to key employees. At December 31, 2013, the only types of awards outstanding are fixed non-qualified stock option awards, restricted stock unit awards, and deferred compensation stock unit awards. | |||||||||||||||
On June 25, 2013, U.S. Cellular paid a special cash dividend to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. Outstanding U.S. Cellular stock options, restricted stock unit awards and deferred compensation stock units were equitably adjusted for the special cash dividend. The impact of such adjustments are fully reflected for all years presented. See Note 4 – Earnings Per Share for additional information. | |||||||||||||||
At December 31, 2013, U.S. Cellular had reserved 10,139,000 Common Shares for equity awards granted and to be granted under the Long-Term Incentive Plans. No Common Shares were reserved for issuance to employees under any employee stock purchase plan since this plan was terminated in the fourth quarter of 2011. | |||||||||||||||
U.S. Cellular also has established a Non-Employee Director compensation plan under which it has reserved 212,000 Common Shares at December 31, 2013 for issuance as compensation to members of the Board of Directors who are not employees of U.S. Cellular or TDS. | |||||||||||||||
U.S. Cellular uses treasury stock to satisfy requirements for Common Shares issued pursuant to its various stock-based compensation plans. | |||||||||||||||
Long-Term Incentive Plans—Stock Options—Stock options granted to key employees are exercisable over a specified period not in excess of ten years. Stock options generally vest over a period of three years from the date of grant. Stock options outstanding at December 31, 2013 expire between 2014 and 2023. However, vested stock options typically expire 30 days after the effective date of an employee's termination of employment for reasons other than retirement. Employees who leave at the age of retirement have 90 days (or one year if they satisfy certain requirements) within which to exercise their vested stock options. The exercise price of options equals the market value of U.S. Cellular Common Shares on the date of grant. | |||||||||||||||
U.S. Cellular estimated the fair value of stock options granted during 2013, 2012, and 2011 using the Black-Scholes valuation model and the assumptions shown in the table below. | |||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
Expected life | 4.6-9.0 years | 4.5 years | 4.3 years | ||||||||||||
Expected volatility | 29.2%-39.6% | 40.7%-42.6% | 43.4%-44.8% | ||||||||||||
Dividend yield | 0% | 0% | 0% | ||||||||||||
Risk-free interest rate | 0.7%-2.4% | 0.5%-0.9% | 0.7%-2.0% | ||||||||||||
Estimated annual forfeiture rate | 0.0%-8.1% | 0.0%-9.1% | 0.0%-7.8% | ||||||||||||
A summary of U.S. Cellular stock options outstanding (total and portion exercisable) and changes during the three years ended December 31, 2013, is presented in the table below: | |||||||||||||||
Common Share Options | Number of Options | Weighted Average Exercise Price | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value | Weighted Average Remaining Contractual Life (in years) | ||||||||||
Outstanding at December 31, 2010 | 2,627,000 | $ | 42.28 | ||||||||||||
(1,333,000 exercisable) | 47.18 | ||||||||||||||
Granted | 694,000 | 44.34 | $ | 16.66 | |||||||||||
Exercised | -201,000 | 32.32 | $ | 2,099,000 | |||||||||||
Forfeited | -83,000 | 39.42 | |||||||||||||
Expired | -203,000 | 49.32 | |||||||||||||
Outstanding at December 31, 2011 | 2,834,000 | $ | 43.07 | ||||||||||||
(1,533,000 exercisable) | 46.23 | ||||||||||||||
Granted | 677,000 | 34.91 | $ | 12.61 | |||||||||||
Exercised | -47,000 | 29.82 | $ | 205,000 | |||||||||||
Forfeited | -117,000 | 38.45 | |||||||||||||
Expired | -133,000 | 46.17 | |||||||||||||
Outstanding at December 31, 2012 | 3,214,000 | $ | 41.58 | ||||||||||||
(1,928,000 exercisable) | $ | 43.99 | |||||||||||||
Granted | 1,213,000 | 32.45 | $ | 11.53 | |||||||||||
Exercised | -892,000 | 34.78 | $ | 6,787,000 | |||||||||||
Forfeited | -574,000 | 34.17 | |||||||||||||
Expired | -247,000 | 48.35 | |||||||||||||
Outstanding at December 31, 2013 | 2,714,000 | $ | 42.22 | $ | 13,015,000 | 6.8 | |||||||||
(1,359,000 exercisable) | $ | 46.91 | $ | 2,632,000 | 4.6 | ||||||||||
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between U.S. Cellular's closing stock price and the exercise price multiplied by the number of in-the-money options) that was received by the option holders upon exercise or that would have been received by option holders had all options been exercised on December 31, 2013. | |||||||||||||||
Long-Term Incentive Plans—Restricted Stock Units—U.S. Cellular grants restricted stock unit awards, which generally vest after three years, to key employees. | |||||||||||||||
U.S. Cellular estimates the fair value of restricted stock units based on the closing market price of U.S. Cellular shares on the date of grant. The fair value is then recognized as compensation cost on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. | |||||||||||||||
A summary of U.S. Cellular nonvested restricted stock units at December 31, 2013 and changes during the year then ended is presented in the table below: | |||||||||||||||
Common Restricted Stock Units | Number | Weighted Average Grant Date Fair Value | |||||||||||||
Nonvested at December 31, 2012 | 1,139,000 | $ | 38.4 | ||||||||||||
Granted | 601,000 | 32.06 | |||||||||||||
Vested | -238,000 | 42.26 | |||||||||||||
Forfeited | -332,000 | 35.63 | |||||||||||||
Nonvested at December 31, 2013 | 1,170,000 | $ | 36.46 | ||||||||||||
The total fair value of restricted stock units that vested during 2013, 2012 and 2011 was $8.8 million, $8.9 million and $9.5 million, respectively, as of the respective vesting dates. The weighted average grant date fair value of restricted stock units granted in 2013, 2012 and 2011 was $32.06, $34.09 and $42.33, respectively. | |||||||||||||||
Long-Term Incentive Plans—Deferred Compensation Stock Units—Certain U.S. Cellular employees may elect to defer receipt of all or a portion of their annual bonuses and to receive a company matching contribution on the amount deferred. All bonus compensation that is deferred by employees electing to participate is immediately vested and is deemed to be invested in U.S. Cellular Common Share stock units. The amount of U.S. Cellular's matching contribution depends on the portion of the annual bonus that is deferred. Participants receive a 25% match for amounts deferred up to 50% of their total annual bonus and a 33% match for amounts that exceed 50% of their total annual bonus; such matching contributions also are deemed to be invested in U.S. Cellular Common Share stock units. | |||||||||||||||
The total fair value of deferred compensation stock units that vested was less than $0.1 million during 2013, 2012 and 2011. The weighted average grant date fair value of deferred compensation stock units granted in 2013, 2012 and 2011 was $31.50, $36.34 and $41.79, respectively. As of December 31, 2013, there were 12,000 vested but unissued deferred compensation stock units valued at $0.5 million. | |||||||||||||||
Compensation of Non-Employee Directors—U.S. Cellular issued 13,000, 7,600 and 6,600 Common Shares in 2013, 2012 and 2011, respectively, under its Non-Employee Director compensation plan. | |||||||||||||||
Stock-Based Compensation Expense | |||||||||||||||
The following table summarizes stock-based compensation expense recognized during 2013, 2012 and 2011: | |||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Stock option awards | $ | 5,810 | $ | 8,471 | $ | 9,549 | |||||||||
Restricted stock unit awards | 9,485 | 12,300 | 10,037 | ||||||||||||
Deferred compensation bonus and matching stock unit awards | 2 | 240 | 12 | ||||||||||||
Awards under employee stock purchase plan | - | - | 255 | ||||||||||||
Awards under Non-Employee Director compensation plan | 547 | 455 | 330 | ||||||||||||
Total stock-based compensation, before income taxes | 15,844 | 21,466 | 20,183 | ||||||||||||
Income tax benefit | -5,984 | -8,121 | -7,581 | ||||||||||||
Total stock-based compensation expense, net of income taxes | $ | 9,860 | $ | 13,345 | $ | 12,602 | |||||||||
The following table provides a summary of the stock-based compensation expense included in the Consolidated Statement of Operations for the years ended: | |||||||||||||||
December 31, | 2013 | 2012 | 2011 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Selling, general and administrative expense | $ | 12,933 | $ | 18,437 | $ | 17,538 | |||||||||
System operations | 2,911 | 3,029 | 2,645 | ||||||||||||
Total stock-based compensation expense | $ | 15,844 | $ | 21,466 | $ | 20,183 | |||||||||
At December 31, 2013, unrecognized compensation cost for all U.S. Cellular stock-based compensation awards was $24.5 million and is expected to be recognized over a weighted average period of 2.3 years. | |||||||||||||||
U.S. Cellular's tax benefits realized from the exercise of stock options and other awards totaled $6.1 million in 2013. | |||||||||||||||
Supplemental_Cash_Flow_Disclos
Supplemental Cash Flow Disclosures | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Disclosure Text Block | ' | |||||||||
Supplemental Cash Flow Disclosures | ' | |||||||||
NOTE 16 SUPPLEMENTAL CASH FLOW DISCLOSURES | ||||||||||
Following are supplemental cash flow disclosures regarding interest paid and income taxes paid. | ||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars in thousands) | ||||||||||
Interest paid | $ | 42,904 | $ | 44,048 | $ | 55,580 | ||||
Income taxes paid (refunded) | $ | 157,778 | $ | -58,609 | $ | -54,469 | ||||
Following are supplemental cash flow disclosures regarding transactions related to stock-based compensation awards. In certain situations, U.S. Cellular withholds shares that are issuable upon the exercise of stock options or the vesting of restricted shares to cover, and with a value equivalent to, the exercise price and/or the amount of taxes required to be withheld from the stock award holder at the time of the exercise or vesting. U.S. Cellular then pays the amount of the required tax withholdings to the taxing authorities in cash. | ||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars in thousands) | ||||||||||
Common Shares withheld | 606,582 | 92,846 | 120,250 | |||||||
Aggregate value of Common Shares withheld | $ | 25,179 | $ | 3,604 | $ | 5,952 | ||||
Cash receipts upon exercise of stock options | 10,468 | 900 | 5,447 | |||||||
Cash disbursements for payment of taxes | -4,684 | -3,105 | -3,512 | |||||||
Net cash receipts (disbursements) from exercise of stock options and vesting of other stock awards | $ | 5,784 | $ | -2,205 | $ | 1,935 | ||||
On September 27, 2012, the FCC conducted a single round, sealed bid, reverse auction to award up to $300 million in one-time Mobility Fund Phase I support to successful bidders that commit to provide 3G, or better, wireless service in areas designated as unserved by the FCC. This auction was designated by the FCC as Auction 901. U.S. Cellular and several of its wholly-owned subsidiaries participated in Auction 901 and were winning bidders in eligible areas within 10 states and will receive up to $40.1 million in one-time support from the Mobility Fund. These funds will reduce the carrying amount of the assets to which they relate or will offset operating expenses. U.S. Cellular has received $13.4 million in support funds as of December 31, 2013, of which $10.3 million is included as a component of Other assets and deferred charges in the Consolidated Balance Sheet and $3.1 million reduced the carrying amount of the assets to which they relate, which are included in Property, plant and equipment in the Consolidated Balance Sheet. | ||||||||||
On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. | ||||||||||
Related_Parties
Related Parties | 12 Months Ended |
Dec. 31, 2013 | |
Disclosure Text Block | ' |
Related Parties | ' |
NOTE 17 RELATED PARTIES | |
U.S. Cellular is billed for all services it receives from TDS, pursuant to the terms of various agreements between it and TDS. These billings are included in U.S. Cellular's Selling, general and administrative expenses. Some of these agreements were established at a time prior to U.S. Cellular's initial public offering when TDS owned more than 90% of U.S. Cellular's outstanding capital stock and may not reflect terms that would be obtainable from an unrelated third party through arms-length negotiations. Billings from TDS to U.S. Cellular are based on expenses specifically identified to U.S. Cellular and on allocations of common expenses. Such allocations are based on the relationship of U.S. Cellular's assets, employees, investment in property, plant and equipment and expenses relative to all subsidiaries in the TDS consolidated group. Management believes the method TDS uses to allocate common expenses is reasonable and that all expenses and costs applicable to U.S. Cellular are reflected in its financial statements. Billings to U.S. Cellular from TDS totaled $99.2 million, $104.3 million and $104.1 million in 2013, 2012 and 2011, respectively. | |
The Audit committee of the Board of Directors of U.S. Cellular is responsible for the review and evaluation of all related party transactions as such term is defined by the rules of the New York Stock Exchange (“NYSE”). |
Certain_Relationships_and_Rela
Certain Relationships and Related Transactions | 12 Months Ended |
Dec. 31, 2013 | |
Disclosure Text Block | ' |
Certain Relationships and Related Transactions | ' |
NOTE 18 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS | |
The following persons are partners of Sidley Austin LLP, the principal law firm of U.S. Cellular and its subsidiaries: Walter C.D. Carlson, a director of U.S. Cellular, a director and non-executive Chairman of the Board of Directors of TDS and a trustee and beneficiary of a voting trust that controls TDS; William S. DeCarlo, the General Counsel of TDS and an Assistant Secretary of TDS and certain subsidiaries of TDS; and Stephen P. Fitzell, the General Counsel of U.S. Cellular and TDS Telecommunications Corporation and an Assistant Secretary of U.S. Cellular and certain other subsidiaries of TDS. Walter C.D. Carlson does not provide legal services to TDS, U.S. Cellular or their subsidiaries. U.S. Cellular and its subsidiaries incurred legal costs from Sidley Austin LLP of $13.2 million in 2013, $10.7 million in 2012 and $9.2 million in 2011. | |
The Audit Committee of the Board of Directors is responsible for the review and evaluation of all related-party transactions as such term is defined by the rules of the New York Stock Exchange. | |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Significant Accounting Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Accounting Policies [Abstract] | ' |
Nature of Operations | ' |
U.S. Cellular owns, operates and invests in wireless systems throughout the United States. As of December 31, 2013, U.S. Cellular served 4.8 million customers. U.S. Cellular operates as one reportable segment. | |
Principles of Consolidation | ' |
The accounting policies of U.S. Cellular 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”). Unless otherwise specified, references to accounting provisions and GAAP in these notes refer to the requirements of the FASB ASC. The consolidated financial statements include the accounts of U.S. Cellular, its majority-owned subsidiaries, general partnerships in which U.S. Cellular has a majority partnership interest and variable interest entities (“VIEs”) in which U.S. Cellular is the primary beneficiary. Both VIE and primary beneficiary represent terms defined by GAAP. | |
Intercompany accounts and transactions have been eliminated. | |
Reclassifications | ' |
Certain prior year amounts have been reclassified to conform to the 2013 financial statement presentation. These reclassifications did not affect consolidated net income attributable to U.S. Cellular shareholders, cash flows, assets, liabilities or equity for the years presented. | |
Business Combinations | ' |
U.S. Cellular accounts for business combinations at fair value in accordance with the acquisition method. This method requires that the acquirer recognize 100% of the acquiree's assets and liabilities at their fair values on the acquisition date for all acquisitions, whether full or partial. In addition, transaction costs related to acquisitions are expensed. | |
Use of Estimates | ' |
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect (a) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and (b) the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates are involved in accounting for goodwill and indefinite-lived intangible assets, depreciation, amortization and accretion, allowance for doubtful accounts, loyalty reward points, income taxes, stock based compensation and asset retirement obligations. | |
Cash and Cash Equivalents | ' |
Cash and cash equivalents include cash and short-term, highly liquid investments with original maturities of three months or less. | |
Short-Term and Long-Term Investments | ' |
At December 31, 2013 and 2012, U.S. Cellular had $50.1 million and $100.7 million, respectively, in Short-term investments. At December 31, 2012, U.S. Cellular had $50.3 million in Long-term investments. Short-term and Long-term investments consist primarily of U.S. Treasury Notes which are designated as held-to-maturity investments and are recorded at amortized cost in the Consolidated Balance Sheet. For these investments, U.S. Cellular's objective is to earn a higher rate of return on funds that are not anticipated to be required to meet liquidity needs in the near term, while maintaining a low level of investment risk. See Note 2 — Fair Value Measurements for additional details on Short-term and Long-term investments. | |
Accounts Receivable | ' |
Accounts receivable consist primarily of amounts owed by customers for wireless services and equipment sales, by agents for sales of equipment to them and by other wireless carriers whose customers have used U.S. Cellular's wireless systems. | |
Allowance for Doubtful Accounts | ' |
The allowance for doubtful accounts is the best estimate of the amount of probable credit losses related to existing accounts receivable. The allowance is estimated based on historical experience and other factors that could affect collectability. Accounts receivable balances are reviewed on either an aggregate or individual basis for collectability depending on the type of receivable. When it is probable that an account balance will not be collected, the account balance is charged against the allowance for doubtful accounts. U.S. Cellular does not have any off-balance sheet credit exposure related to its customers. | |
Inventory | ' |
Inventory consists primarily of wireless devices stated at the lower of cost or market, with cost determined using the first-in, first-out method and market determined by replacement costs or estimated net realizable value. | |
Fair Value Measurements | ' |
Under the provisions of GAAP, fair value is a market-based measurement and not an entity-specific measurement, based on an exchange transaction in which the entity sells an asset or transfers a liability (exit price). The provisions also 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. | |
Intangible Assets | ' |
Goodwill | |
U.S. Cellular has Goodwill as a result of its acquisitions of wireless businesses. Such Goodwill represents the excess of the total purchase price over the fair value of net assets acquired in these transactions. | |
Licenses | |
Licenses consist of direct and incremental costs incurred in acquiring Federal Communications Commission (“FCC”) licenses to provide wireless service. | |
U.S. Cellular has determined that wireless licenses are indefinite-lived intangible assets and, therefore, not subject to amortization based on the following factors: | |
Radio spectrum is not a depleting asset. | |
The ability to use radio spectrum is not limited to any one technology. | |
U.S. Cellular and its consolidated subsidiaries are licensed to use radio spectrum through the FCC licensing process, which enables licensees to utilize specified portions of the spectrum for the provision of wireless service. | |
U.S. Cellular and its consolidated subsidiaries are required to renew their FCC licenses every ten years or, in some cases, every fifteen years. To date, all of U.S. Cellular's license renewal applications have been granted by the FCC. Generally, license renewal applications filed by licensees otherwise in compliance with FCC regulations are routinely granted. If, however, a license renewal application is challenged either by a competing applicant for the license or by a petition to deny the renewal application, the license will be renewed if the licensee can demonstrate its entitlement to a “renewal expectancy.” Licensees are entitled to such an expectancy if they can demonstrate to the FCC that they have provided “substantial service” during their license term and have “substantially complied” with FCC rules and policies. U.S. Cellular believes that it is probable that its future license renewal applications will be granted. | |
Goodwill and Licenses Impairment Assessment | |
Goodwill and Licenses must be assessed for impairment annually or more frequently if events or changes in circumstances indicate that such assets might be impaired. U.S. Cellular performs its annual impairment assessment of Goodwill and Licenses as of November 1 of each year. | |
U.S. Cellular may first assess qualitative factors, such as company, industry and economic trends to determine whether it is necessary to perform the two-step Goodwill impairment test. If determined to be necessary, the first step compares the fair value of the reporting unit to its carrying value. If the carrying amount exceeds the fair value, the second step of the test is performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of reporting unit Goodwill with the carrying amount of that Goodwill. To calculate the implied fair value of Goodwill in this second step, an enterprise allocates the fair value of the reporting unit to all of the assets and liabilities of that reporting unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value was the price paid to acquire the reporting unit. The excess of the fair value of the reporting unit over the amount assigned to the assets and liabilities of the reporting unit is the implied fair value of Goodwill. If the carrying amount of Goodwill exceeds the implied fair value of Goodwill, an impairment loss is recognized for that difference. | |
The impairment test for an indefinite-lived intangible asset other than Goodwill may consist of first assessing qualitative factors, such as company, industry and economic trends. If determined to be necessary, the next step compares the fair value of the intangible asset to its carrying amount. If the carrying amount exceeds the fair value, an impairment loss is recognized for the difference. | |
Quoted market prices in active markets are the best evidence of fair value of an intangible asset or reporting unit and are used when available. If quoted market prices are not available, the estimate of fair value is based on the best information available, including prices for similar assets and the use of other valuation techniques. Other valuation techniques include present value analysis, multiples of earnings or revenues, or similar performance measures. The use of these techniques involve assumptions by management about factors that are uncertain including future cash flows, the appropriate discount rate, and other inputs. Different assumptions for these inputs could create materially different results. | |
U.S. Cellular tests Goodwill for impairment at the level of reporting referred to as a reporting unit. For purposes of its impairment testing of Goodwill in 2013, U.S. Cellular identified four reporting units. The four reporting units represent four geographic groupings of operating markets, representing four geographic service areas. For purposes of its impairment testing of Goodwill in 2012, U.S. Cellular identified five reporting units. The change in reporting units resulted from the NY1 & NY2 Deconsolidation more fully described in Note 7 — Investments in Unconsolidated Entities. | |
A discounted cash flow approach was used to value each reporting unit for purposes of the Goodwill impairment review by using value drivers and risks specific to the current industry and economic markets. The cash flow estimates incorporated assumptions that market participants would use in their estimates of fair value. Key assumptions made in this process were the discount rate, estimated expected revenue growth rate, projected capital expenditures and the terminal growth rate. | |
U.S. Cellular tests Licenses for impairment at the level of reporting referred to as a unit of accounting. For purposes of its 2013 impairment testing of Licenses, U.S. Cellular separated its FCC licenses into eleven units of accounting based on geographic service areas. For purposes of its 2012 impairment testing of Licenses, U.S. Cellular separated its FCC licenses into thirteen units of accounting based on geographic service areas. The change in units of accounting resulted from (i) the Divestiture Transaction and the Mississippi Valley non-operating market license sale, both of which are more fully described in Note 5 — Acquisitions, Divestitures and Exchanges and (ii) the NY1 & NY2 Deconsolidation more fully described in Note 7 — Investments in Unconsolidated Entities. In both 2013 and 2012, seven of the units of accounting represented geographic groupings of licenses which, because they were not being utilized and, therefore, were not expected to generate cash flows from operating activities in the foreseeable future, were considered separate units of accounting for purposes of impairment testing. | |
U.S. Cellular estimates the fair value of built licenses for purposes of impairment testing using the build-out method. The build-out method estimates the fair value of Licenses by calculating future cash flows from a hypothetical start-up wireless company and assuming that the only assets available upon formation are the underlying Licenses. To apply this method, a hypothetical build-out of U.S. Cellular's wireless network, infrastructure, and related costs are projected based on market participant information. Calculated cash flows, along with a terminal value, are discounted to the present and summed to determine the estimated fair value. | |
For units of accounting which consist of unbuilt licenses, U.S. Cellular prepares estimates of fair value by reference to prices paid in recent auctions and market transactions where available. If such information is not available, the fair value of the unbuilt licenses is assumed to change by the same percentage, and in the same direction, that the fair value of built licenses measured using the build-out method changed during the period. | |
Investments in Unconsolidated Entities | ' |
Investments in unconsolidated entities consist of amounts invested in wireless entities in which U.S. Cellular holds a noncontrolling interest. U.S. Cellular follows the equity method of accounting for such investments in which its ownership interest is less than or equal to 50% but equals or exceeds 20% for corporations and 3% for partnerships and limited liability companies, or for unconsolidated entities in which its ownership is greater than 50% but U.S. Cellular does not have a controlling financial interest. The cost method of accounting is followed for such investments in which U.S. Cellular's ownership interest is less than 20% for corporations and is less than 3% for partnerships and limited liability companies and for investments for which U.S. Cellular does not have the ability to exercise significant influence. | |
For its equity method investments for which financial information is readily available, U.S. Cellular records its equity in the earnings of the entity in the current period. For its equity method investments for which financial information is not readily available, U.S. Cellular records its equity in the earnings of the entity on a one quarter lag basis. | |
Property, Plant and Equipment | ' |
U.S. Cellular's Property, plant and equipment is stated at the original cost of construction or purchase including capitalized costs of certain taxes, payroll-related expenses, interest and estimated costs to remove the assets. | |
Expenditures that enhance the productive capacity of assets in service or extend their useful lives are capitalized and depreciated. Expenditures for maintenance and repairs of assets in service are charged to System operations expense or Selling, general and administrative expense, as applicable. Retirements and disposals of assets are recorded by removing the original cost of the asset (along with the related accumulated depreciation) from plant in service and charging it, together with net removal costs (removal costs less any applicable accrued asset retirement obligations and salvage value realized), to (Gain) loss on asset disposals, net. | |
Costs of developing new information systems are capitalized and amortized over their expected economic useful lives. | |
Depreciation | ' |
Depreciation is provided using the straight-line method over the estimated useful life of the assets. | |
U.S. Cellular depreciates leasehold improvement assets associated with leased properties over periods ranging from one to thirty years; such periods approximate the shorter of the assets' economic lives or the specific lease terms. | |
Useful lives of specific assets are reviewed throughout the year to determine if changes in technology or other business changes would warrant accelerating the depreciation of those specific assets. Due to the Divestiture Transaction more fully described in Note 5 — Acquisitions, Divestitures and Exchanges, U.S. Cellular changed the useful lives of certain assets in 2013 and 2012. Other than the Divestiture Transaction, there were no other material changes to useful lives of property, plant and equipment in 2013, 2012 or 2011. | |
Impairment of Long-lived Assets | ' |
U.S. Cellular reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the assets might be impaired. If necessary, the impairment test for tangible long-lived assets is a two-step process. The first step compares the carrying value of the asset (or asset group) with the estimated undiscounted cash flows over the remaining asset (or asset group) life. If the carrying value of the asset (or asset group) is greater than the undiscounted cash flows, the second step of the test is performed to measure the amount of impairment loss. The second step compares the carrying value of the asset to its estimated fair value. If the carrying value exceeds the estimated fair value (less cost to sell), an impairment loss is recognized for the difference. | |
U.S. Cellular has one asset group for purposes of assessing property, plant and equipment for impairment based on the fact that the individual operating markets are reliant on centrally operated data centers, mobile telephone switching offices, network operations center and wide-area network. As a result, U.S. Cellular operates a single integrated national wireless network, and the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities represent cash flows generated by this single interdependent network. | |
Quoted market prices in active markets are the best evidence of fair value of a tangible long-lived asset and are used when available. If quoted market prices are not available, the estimate of fair value is based on the best information available, including prices for similar assets and the use of other valuation techniques. A present value analysis of cash flow scenarios is often the best available valuation technique. The use of this technique involves assumptions by management about factors that are uncertain including future cash flows, the appropriate discount rate and other inputs. Different assumptions for these inputs could create materially different results. | |
Agent Liabilities | ' |
U.S. Cellular has relationships with agents, which are independent businesses that obtain customers for U.S. Cellular. At December 31, 2013 and 2012, U.S. Cellular had accrued $121.3 million and $88.2 million, respectively, for amounts due to agents. This amount is included in Other current liabilities in the Consolidated Balance Sheet. | |
Other Assets and Deferred Charges | ' |
Other assets and deferred charges include underwriters' and legal fees and other charges related to issuing U.S. Cellular's various borrowing instruments and other long-term agreements, and are amortized over the respective term of each instrument. The amounts for deferred charges included in the Consolidated Balance Sheet at December 31, 2013 and 2012, are shown net of accumulated amortization of $26.0 million and $12.7 million, respectively. | |
Asset Retirement Obligations | ' |
U.S. Cellular operates cell sites, retail stores and office spaces in its operating markets. A majority of these sites, stores and office spaces are leased. Most of these leases contain terms which require or may require U.S. Cellular to return the leased property to its original condition at the lease expiration date. | |
U.S. Cellular accounts for asset retirement obligations by recording the fair value of a liability for legal obligations associated with an asset retirement in the period in which the obligations are incurred. At the time the liability is incurred, U.S. Cellular records a liability equal to the net present value of the estimated cost of the asset retirement obligation and increases the carrying amount of the related long-lived asset by an equal amount. The liability is accreted to its present value over a period ending with the estimated settlement date of the respective asset retirement obligation. The carrying amount of the long-lived asset is depreciated over the useful life of the asset. Upon settlement of the obligation, any difference between the cost to retire the asset and the recorded liability (including accretion of discount) is recognized in the Consolidated Statement of Operations. | |
Treasury Shares | 'Common Shares repurchased by U.S. Cellular are recorded at cost as treasury shares and result in a reduction of equity. Treasury shares are reissued as part of U.S. Cellular’s stock-based compensation programs. When treasury shares are reissued, U.S. Cellular determines the cost using the first-in, first-out cost method. The difference between the cost of the treasury shares and reissuance price is included in Additional paid-in capital or Retained earnings. |
Revenue Recognition | ' |
Revenues from wireless operations consist primarily of: | |
Charges for access, airtime, roaming, long distance, data and other value added services provided to U.S. Cellular's retail customers and to end users through third-party resellers; | |
Charges to carriers whose customers use U.S. Cellular's systems when roaming; | |
Sales of equipment and accessories; | |
Amounts received from the Universal Service Fund (“USF”) in states where U.S. Cellular has been designated an Eligible Telecommunications Carrier (“ETC”); and | |
Redemptions of loyalty reward points for products or services. | |
Revenues related to wireless services and other value added services are recognized as services are rendered. Revenues billed in advance or in arrears of the services being provided are estimated and deferred or accrued, as appropriate. | |
Revenues from sales of equipment and accessories are recognized when title and risk of loss passes to the agent or end-user customer. | |
U.S. Cellular allocates revenue to each element of multiple element service offerings using the relative selling price method. Under this method, arrangement consideration, which consists of the amounts billed to the customer net of any cash-based discounts, is allocated to each element on the basis of its relative selling price on a stand-alone basis. Such stand-alone selling price is determined in accordance with the following hierarchy: | |
U.S. Cellular-specific objective evidence of stand-alone selling price, if available; otherwise | |
Third-party evidence of selling price, if it is determinable; otherwise | |
A best estimate of stand-alone selling price. | |
U.S. Cellular estimates stand-alone selling prices of the elements of its service offerings as follows: | |
Wireless services – Based on the actual selling price U.S. Cellular offers when such plan is sold on a stand-alone basis, or if the plan is not sold on a stand-alone basis, U.S. Cellular's estimate of the price of such plan based on similar plans that are sold on a stand-alone basis. | |
Wireless devices – Based on the selling price of the respective wireless device when it is sold on a stand-alone basis. | |
Phone Replacement – Based on U.S. Cellular's estimate of the price of this service if it were sold on a stand-alone basis, which was calculated by estimating the cost of this program plus a reasonable margin. | |
Loyalty reward points – By estimating the retail price of the products and services for which points may be redeemed and dividing such amount by the number of loyalty points required to receive such products and services. This is calculated on a weighted average basis and requires U.S. Cellular to estimate the percentage of loyalty points that will be redeemed for each product or service. | |
U.S. Cellular follows the deferred revenue method of accounting for its loyalty reward program. Under this method, revenue allocated to loyalty reward points is deferred. Revenue is recognized at the time of customer redemption or when such points have been depleted via an account maintenance charge. U.S. Cellular periodically reviews and revises the redemption and depletion rates as appropriate based on history and related future expectations. As of December 31, 2013, U.S. Cellular estimated loyalty reward points breakage based on actuarial estimates and recorded a $7.4 million change in estimate, which reduced Customer deposits and deferred revenues in the Consolidated Balance Sheet and increased Service revenues in the Consolidated Statement of Operations. | |
In the fourth quarter of 2013, U.S. Cellular issued loyalty reward points with a value of $43.5 million as a loyalty bonus in recognition of the inconvenience experienced by customers during U.S. Cellular's recent billing system conversion. The value of the loyalty bonus reduced Service revenues in the Consolidated Statement of Operations and increased Customer deposits and deferred revenues in the Consolidated Balance Sheet. | |
As of December 31, 2013 and 2012, U.S. Cellular had deferred revenue related to loyalty reward points outstanding of $116.2 million and $56.6 million, respectively. These amounts are recorded in Customer deposits and deferred revenues (a current liability account) in the Consolidated Balance Sheet, as customers may redeem their reward points within the current period. | |
Cash-based discounts and incentives, including discounts to customers who pay their bills through the use of on-line bill payment methods, are recognized as a reduction of Operating revenues concurrently with the associated revenue, and are allocated to the various products and services in the bundled offering based on their respective relative selling price. | |
In order to provide better control over wireless device quality, U.S. Cellular sells wireless devices to agents. U.S. Cellular pays rebates to agents at the time an agent activates a new customer or retains an existing customer in a transaction involving a wireless device. U.S. Cellular accounts for these rebates by reducing revenues at the time of the wireless device sale to the agent rather than at the time the agent activates a new customer or retains a current customer. Similarly, U.S. Cellular offers certain wireless device sales rebates and incentives to its retail customers and records the revenue net of the corresponding rebate or incentive. The total potential rebates and incentives are reduced by U.S. Cellular's estimate of rebates that will not be redeemed by customers based on historical experience of such redemptions. | |
GAAP requires that activation fees charged with the sale of equipment and service be allocated to the equipment and service based upon the relative selling prices of each item. Device activation fees charged at agent locations, where U.S. Cellular does not also sell a wireless device to the customer, are deferred and recognized over the average device life. Device activation fees charged as a result of handset sales at Company-owned retail stores are recognized at the time the handset is delivered to the customer. | |
ETC revenues recognized in the reporting period represent the amounts which U.S. Cellular is entitled to receive for such period, as determined and approved in connection with U.S. Cellular's designation as an ETC in various states. | |
Amounts Collected from Customers and Remitted to Governmental Authorities | ' |
U.S. Cellular records amounts collected from customers and remitted to governmental authorities net within a tax liability account if the tax is assessed upon the customer and U.S. Cellular merely acts as an agent in collecting the tax on behalf of the imposing governmental authority. If the tax is assessed upon U.S. Cellular, 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 $114.7 million, $135.7 million and $125.2 million for 2013, 2012 and 2011, respectively. | |
Advertising Costs | ' |
U.S. Cellular expenses advertising costs as incurred. Advertising costs totaled $199.9 million, $227.0 million and $257.8 million in 2013, 2012 and 2011, respectively. | |
Income Taxes | ' |
U.S. Cellular is included in a consolidated federal income tax return with other members of the TDS consolidated group. TDS and U.S. Cellular are parties to a Tax Allocation Agreement which provides that U.S. Cellular and its subsidiaries be included with the TDS affiliated group in a consolidated federal income tax return and in state income or franchise tax returns in certain situations. For financial statement purposes, U.S. Cellular and its subsidiaries calculate their income, income taxes and credits as if they comprised a separate affiliated group. Under the Tax Allocation Agreement, U.S. Cellular remits its applicable income tax payments to TDS. U.S. Cellular had a tax payable balance with TDS of $34.8 million and $1.1 million as of December 31, 2013 and 2012, respectively. | |
Deferred taxes are computed using the liability method, whereby deferred tax assets are recognized for future deductible temporary differences and operating loss carryforwards, and deferred tax liabilities are recognized for future taxable temporary differences. Both deferred tax assets and liabilities are measured using the tax rates anticipated to be in effect when the temporary differences reverse. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. U.S. Cellular evaluates income tax uncertainties, assesses the probability of the ultimate settlement with the applicable taxing authority and records an amount based on that assessment. | |
Stock-Based Compensation | ' |
U.S. Cellular has established a long-term incentive plan and a Non-Employee Director compensation plan, and previously had an employee stock purchase plan before this was terminated in the fourth quarter of 2011. Also, U.S. Cellular employees were eligible to participate in the TDS employee stock purchase plan before this was terminated in the fourth quarter of 2011. These plans are described more fully in Note 15 — Stock-based Compensation. These plans are considered compensatory plans and, therefore, recognition of compensation cost for grants made under these plans is required. | |
U.S. Cellular values its share-based payment transactions using a Black-Scholes valuation model. Stock-based compensation cost recognized during the period is based on the portion of the share-based payment awards that are ultimately expected to vest. Accordingly, stock-based compensation cost recognized has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Pre-vesting forfeitures and expected life are estimated based on historical experience related to similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. U.S. Cellular believes that its historical experience provides the best estimates of future pre-vesting forfeitures and future expected life. The expected volatility assumption is based on the historical volatility of U.S. Cellular's common stock over a period commensurate with the expected life. The dividend yield assumption is zero because U.S. Cellular has never paid a dividend, except a special cash dividend in June 2013, and has expressed its intention to retain all future earnings in the business. The risk-free interest rate assumption is determined using the U.S. Treasury Yield Curve Rate with a term length that approximates the expected life of the stock options. | |
The fair value of options is recognized as compensation cost over the respective requisite service period of the awards, which is generally the vesting period, on a straight-line basis for each separate vesting portion of the awards as if the awards were, in-substance, multiple awards (graded vesting attribution method). | |
Defined Contribution Plans | ' |
U.S. Cellular participates in a qualified noncontributory defined contribution pension plan sponsored by TDS; such plan provides pension benefits for the employees of U.S. Cellular and its subsidiaries. Under this plan, pension benefits and costs are calculated separately for each participant and are funded currently. Pension costs were $10.4 million, $12.4 million and $11.6 million in 2013, 2012 and 2011, respectively. | |
U.S. Cellular also participates in a defined contribution retirement savings plan (“401(k) plan”) sponsored by TDS. Total costs incurred from U.S. Cellular's contributions to the 401(k) plan were $15.4 million, $17.1 million and $15.5 million in 2013, 2012 and 2011, respectively. | |
Operating Leases | ' |
U.S. Cellular is a party to various lease agreements for office space, retail stores, cell sites and equipment that are accounted for as operating leases. Certain leases have renewal options and/or fixed rental increases. Renewal options that are reasonably assured of exercise are included in determining the lease term. U.S. Cellular accounts for certain operating leases that contain rent abatements, lease incentives and/or fixed rental increases by recognizing lease revenue and expense on a straight-line basis over the lease term. | |
Recently Issued Accounting Pronouncements | ' |
On July 18, 2013, the FASB issued Accounting Standards Update 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryfoward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). ASU 2013-11 addresses the presentation of an unrecognized tax benefit when a net operating loss carryforward or tax credit carryforward exists. In such event, an unrecognized tax benefit, or portion of an unrecognized tax benefit, would be presented in the Consolidated Balance Sheet as a reduction to deferred tax assets unless the net operating loss carryforward or tax credit carryforward at the reporting date is not available under the tax law of the applicable jurisdiction. U.S. Cellular is required to adopt the provisions of ASU 2013-11 effective January 1, 2014. The adoption of ASU 2013-11 is not expected to have a significant impact on U.S. Cellular's financial position or results of operations. | |
Variable Interest Entities | ' |
U.S. Cellular consolidates variable interest entities in which it has a controlling financial interest and is 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. U.S. Cellular reviews these criteria initially at the time it enters into agreements and subsequently when reconsideration events occur. | |
Legal proceedings | ' |
U.S. Cellular is involved or may be involved from time to time in legal proceedings before the FCC, other regulatory authorities, and/or various state and federal courts. If U.S. Cellular believes that a loss arising from such legal proceedings is probable and can be reasonably estimated, an amount is accrued in the financial statements for the estimated loss. If only a range of loss can be determined, the best estimate within that range is accrued; if none of the estimates within that range is better than another, the low end of the range is accrued. The assessment of the expected outcomes of legal proceedings is a highly subjective process that requires judgments about future events. The legal proceedings are reviewed at least quarterly to determine the adequacy of accruals and related financial statement disclosures. The ultimate outcomes of legal proceedings could differ materially from amounts accrued in the financial statements. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Table) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Accounting Policies [Abstract] | ' | |||||||||
Accounts receivable, allowance for doubtful accounts receivable | ' | |||||||||
The changes in the allowance for doubtful accounts during the years ended December 31, 2013, 2012 and 2011 were as follows: | ||||||||||
2013 | 2012 | 2011 | ||||||||
(Dollars in thousands) | ||||||||||
Beginning balance | $ | 26,902 | $ | 23,537 | $ | 25,816 | ||||
Additions, net of recoveries | 98,864 | 67,372 | 62,157 | |||||||
Deductions | -65,528 | -64,007 | -64,436 | |||||||
Ending balance | $ | 60,238 | $ | 26,902 | $ | 23,537 |
Fair_Value_Measurements_Table
Fair Value Measurements (Table) | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Fair Value Disclosures | ' | ||||||||||||||
Fair value measurements | ' | ||||||||||||||
31-Dec-13 | 31-Dec-12 | ||||||||||||||
Level within the Fair Value Hierarchy | Book Value | Fair Value | Book Value | Fair Value | |||||||||||
(Dollars in thousands) | |||||||||||||||
Cash and cash equivalents | 1 | $ | 342,065 | $ | 342,065 | $ | 378,358 | $ | 378,358 | ||||||
Short-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | 50,104 | 50,104 | 100,676 | 100,676 | ||||||||||
Long-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | - | - | 50,305 | 50,339 | ||||||||||
Long-term debt | |||||||||||||||
6.95% Senior Notes | 1 | 342,000 | 309,852 | 342,000 | 376,610 | ||||||||||
6.7% Senior Notes | 2 | 532,449 | 507,697 | 532,194 | 582,744 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Income Tax Disclosure | ' | ||||||||||||||||||
Income taxes receivable | ' | ||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Federal income taxes (payable) | $ | -32,351 | $ | -1,614 | |||||||||||||||
State income taxes receivable (payable) | -1,545 | 1,612 | |||||||||||||||||
Income tax expense | ' | ||||||||||||||||||
Income tax expense (benefit) is summarized as follows: | |||||||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Current | |||||||||||||||||||
Federal | $ | 180,056 | $ | 10,547 | $ | -90,235 | |||||||||||||
State | 8,426 | 4,186 | 1,049 | ||||||||||||||||
Deferred | |||||||||||||||||||
Federal | -69,917 | 54,490 | 187,581 | ||||||||||||||||
State | -5,431 | -5,246 | 15,683 | ||||||||||||||||
$ | 113,134 | $ | 63,977 | $ | 114,078 | ||||||||||||||
Income tax reconciliation | ' | ||||||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | ||||||||||||||
(Dollars in millions) | |||||||||||||||||||
Statutory federal income tax expense and rate | $ | 90.2 | 35 | % | $ | 71.8 | 35 | % | $ | 109.5 | 35 | % | |||||||
State income taxes, net of federal benefit (1) | 5.2 | 2 | 3.7 | 1.8 | 4.5 | 1.4 | |||||||||||||
Effect of noncontrolling interests | -2.2 | -0.9 | -6.3 | -3.1 | -4.9 | -1.6 | |||||||||||||
Gains (losses) on investments and sale of assets (2) | 20.5 | 8 | - | - | - | - | |||||||||||||
Correction of deferred taxes (3) | - | - | -5.3 | -2.6 | 6.1 | 2 | |||||||||||||
Other differences, net | -0.6 | -0.2 | 0.1 | 0.1 | -1.1 | -0.3 | |||||||||||||
Total income tax expense and rate | $ | 113.1 | 43.9 | % | $ | 64 | 31.2 | % | $ | 114.1 | 36.5 | % | |||||||
-1 | Net state income taxes include changes in the valuation allowance. In addition, state tax benefits related to the settlement of state tax audits and the expiration of statutes of limitations are included in 2013, 2012 and 2011. | ||||||||||||||||||
-2 | Represents 2013 tax expense related to the NY1 & NY2 Deconsolidation and the Divestiture Transaction. | ||||||||||||||||||
-3 | U.S. Cellular recorded immaterial adjustments to correct deferred tax balances in 2012 and 2011 related to tax basis and law changes that related to periods prior to 2012 and 2011, respectively. | ||||||||||||||||||
Temporary income tax differences | ' | ||||||||||||||||||
U.S. Cellular’s noncurrent deferred income tax assets and liabilities at December 31, 2013 and 2012 and the temporary differences that gave rise to them were as follows: | |||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Noncurrent deferred tax assets | |||||||||||||||||||
Net operating loss (“NOL”) carryforwards | $ | 61,294 | $ | 63,240 | |||||||||||||||
Stock-based compensation | 19,028 | 22,411 | |||||||||||||||||
Compensation and benefits - other | 3,746 | 13,673 | |||||||||||||||||
Deferred rent | 19,462 | 15,822 | |||||||||||||||||
Other | 24,604 | 25,432 | |||||||||||||||||
128,134 | 140,578 | ||||||||||||||||||
Less valuation allowance | -40,392 | -40,208 | |||||||||||||||||
Total noncurrent deferred tax assets | 87,742 | 100,370 | |||||||||||||||||
Noncurrent deferred tax liabilities | |||||||||||||||||||
Property, plant and equipment | 503,491 | 527,547 | |||||||||||||||||
Licenses/intangibles | 282,764 | 294,738 | |||||||||||||||||
Partnership investments | 133,931 | 124,221 | |||||||||||||||||
Other | 3,853 | 3,682 | |||||||||||||||||
Total noncurrent deferred tax liabilities | 924,039 | 950,188 | |||||||||||||||||
Net noncurrent deferred income tax liability | $ | 836,297 | $ | 849,818 | |||||||||||||||
Deferred tax valuation allowance | ' | ||||||||||||||||||
A summary of U.S. Cellular’s deferred tax asset valuation allowance is as follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Balance at January 1, | $ | 41,295 | $ | 30,261 | $ | 29,891 | |||||||||||||
Charged to income tax expense | -1,527 | 3,033 | -1,450 | ||||||||||||||||
Charged to other accounts | 3,607 | 8,001 | 1,820 | ||||||||||||||||
Balance at December 31, | $ | 43,375 | $ | 41,295 | $ | 30,261 | |||||||||||||
As of December 31, 2013, the valuation allowance reduced current deferred tax assets by $3.0 million and noncurrent deferred tax assets by $40.4 million. | |||||||||||||||||||
Income tax unrecognized benefits summary | ' | ||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Unrecognized tax benefits balance at January 1, | $ | 26,460 | $ | 28,745 | $ | 32,547 | |||||||||||||
Additions for tax positions of current year | 5,925 | 6,656 | 4,487 | ||||||||||||||||
Additions for tax positions of prior years | 1,501 | 854 | 332 | ||||||||||||||||
Reductions for tax positions of prior years | -45 | -115 | -1,104 | ||||||||||||||||
Reductions for settlements of tax positions | -576 | - | -244 | ||||||||||||||||
Reductions for lapses in statutes of limitations | -4,452 | -9,680 | -7,273 | ||||||||||||||||
Unrecognized tax benefits balance at December 31, | $ | 28,813 | $ | 26,460 | $ | 28,745 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Earnings Per Share | ' | |||||||||
Earnings per share | ' | |||||||||
Year ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars and shares in thousands, except earnings per share) | ||||||||||
Net income attributable to U.S. Cellular shareholders | $ | 140,038 | $ | 111,006 | $ | 175,041 | ||||
Weighted average number of shares used in basic earnings per share | 83,968 | 84,645 | 84,877 | |||||||
Effect of dilutive securities: | ||||||||||
Stock options | 211 | 184 | 224 | |||||||
Restricted stock units | 551 | 401 | 347 | |||||||
Weighted average number of shares used in diluted earnings per share | 84,730 | 85,230 | 85,448 | |||||||
Basic earnings per share attributable to U.S. Cellular shareholders | $ | 1.67 | $ | 1.31 | $ | 2.06 | ||||
Diluted earnings per share attributable to U.S. Cellular shareholders | $ | 1.65 | $ | 1.3 | $ | 2.05 | ||||
Summary of antidilutive shares | ' | |||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Shares in thousands) | ||||||||||
Stock options | 2,010 | 2,123 | 1,591 | |||||||
Restricted stock units | 190 | 369 | 250 |
Acquisitions_Divestitures_and_1
Acquisitions, Divestitures and Exchanges (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
Business Combination | ' | ||||||||||||||||||||||
Acquisitions, Divestitures and Exchanges | ' | ||||||||||||||||||||||
U.S. Cellular acquisitions in 2013 and 2012 and the allocation of the purchase price for these acquisitions were as follows: | |||||||||||||||||||||||
Allocation of Purchase Price | |||||||||||||||||||||||
(Dollars in thousands) | Purchase Price | Goodwill | Licenses | Intangible Assets Subject to Amortization | Net Tangible Assets/(Liabilities) | ||||||||||||||||||
2013 | |||||||||||||||||||||||
Licenses | $ | 16,540 | $ | - | $ | 16,540 | $ | - | $ | - | |||||||||||||
2012 | |||||||||||||||||||||||
Licenses | $ | 122,690 | $ | - | $ | 122,690 | $ | - | $ | - | |||||||||||||
Divestiture Financial Impacts | ' | ||||||||||||||||||||||
Business divestiture financial impacts | ' | ||||||||||||||||||||||
(Dollars in thousands) | Expected Period of Recognition | Projected Range | Cumulative Amount Recognized as of December 31, 2013 | Actual Amount Recognized Year Ended December 31, 2013 | Actual Amount Recognized Three Months Ended December 31, 2013 | Actual Amount Recognized Three Months and Year Ended December 31, 2012 | |||||||||||||||||
(Gain) loss on sale of business and other exit costs, net | |||||||||||||||||||||||
Proceeds from Sprint | |||||||||||||||||||||||
Purchase price | 2013 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | - | $ | - | ||||||||||
Sprint Cost Reimbursement | 2013-2014 | -120,000 | -175,000 | -47,641 | -47,641 | -43,420 | - | ||||||||||||||||
Net assets transferred | 2013 | 213,593 | 213,593 | 213,593 | 213,593 | - | - | ||||||||||||||||
Non-cash charges for the write-off and write-down of property under construction and related assets | 2012-2014 | 10,000 | 14,000 | 10,675 | 3 | -51 | 10,672 | ||||||||||||||||
Employee related costs including severance, retention and outplacement | 2012-2014 | 12,000 | 18,000 | 14,262 | 1,653 | -809 | 12,609 | ||||||||||||||||
Contract termination costs | 2012-2014 | 110,000 | 160,000 | 59,584 | 59,525 | 40,744 | 59 | ||||||||||||||||
Transaction costs | 2012-2014 | 5,000 | 6,000 | 5,565 | 4,428 | 347 | 1,137 | ||||||||||||||||
Total (Gain) loss on sale of business and other exit costs, net | $ | -249,407 | $ | -243,407 | $ | -223,962 | $ | -248,439 | $ | -3,189 | $ | 24,477 | |||||||||||
Depreciation, amortization and accretion expense | |||||||||||||||||||||||
Incremental depreciation, amortization and accretion, net of salvage values | 2012-2014 | 200,000 | 225,000 | 198,571 | 178,513 | 44,513 | 20,058 | ||||||||||||||||
(Increase) decrease in Operating income | $ | -49,407 | $ | -18,407 | $ | -25,391 | $ | -69,926 | $ | 41,324 | $ | 44,535 | |||||||||||
As a result of the transaction, U.S. Cellular recognized the following amounts in the Consolidated Balance Sheet: | |||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||
(Dollars in thousands) | Balance December 31, 2012 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance December 31, 2013 | ||||||||||||||||||
Accrued compensation | |||||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | 12,305 | $ | 6,853 | $ | -11,905 | $ | -5,200 | $ | 2,053 | |||||||||||||
Other current liabilities | |||||||||||||||||||||||
Contract termination costs | $ | 30 | $ | 22,675 | $ | -8,713 | $ | - | $ | 13,992 | |||||||||||||
Other deferred liabilities and credits | |||||||||||||||||||||||
Contract termination costs | $ | - | $ | 34,283 | $ | -3,434 | $ | - | $ | 30,849 | |||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||
(Dollars in thousands) | Balance November 6, 2012 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance December 31, 2012 | ||||||||||||||||||
Accrued compensation | |||||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | - | $ | 12,609 | $ | -304 | $ | - | $ | 12,305 | |||||||||||||
Other current liabilities | |||||||||||||||||||||||
Contract termination costs | $ | - | $ | 59 | $ | -29 | $ | - | $ | 30 | |||||||||||||
-1 | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | ||||||||||||||||||||||
-2 | Adjustment to liability represents changes to previously accrued amounts. | ||||||||||||||||||||||
Assets and liabilities held for sale | ' | ||||||||||||||||||||||
At December 31, 2013 and 2012, the following assets and liabilities were classified in the Consolidated Balance Sheet as "Assets held for sale" and "Liabilities held for sale": | |||||||||||||||||||||||
Current Assets | Licenses | Goodwill | Property, Plant and Equipment | Loss on Assets Held for Sale (1) | Total Assets Held for Sale | Liabilities Held for Sale (2) | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
2013 | |||||||||||||||||||||||
Divestiture of Spectrum Licenses | $ | - | $ | 16,027 | $ | - | $ | - | $ | - | $ | 16,027 | $ | - | |||||||||
2012 | |||||||||||||||||||||||
Divestiture Transaction | $ | - | $ | 140,599 | $ | 72,994 | $ | - | $ | - | $ | 213,593 | $ | 19,594 | |||||||||
Bolingbrook Customer Care Center (3) | - | - | - | 4,275 | -1,105 | 3,170 | - | ||||||||||||||||
Total | $ | - | $ | 140,599 | $ | 72,994 | $ | 4,275 | $ | -1,105 | $ | 216,763 | $ | 19,594 | |||||||||
-1 | Loss on assets held for sale was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations. | ||||||||||||||||||||||
-2 | Liabilities held for sale primarily consisted of Customer deposits and deferred revenues. | ||||||||||||||||||||||
-3 | Effective January 1, 2013, U.S. Cellular transferred its Bolingbrook Customer Care Center operations to an existing third party vendor. |
Intangible_Assets_Tables
Intangible Assets (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Licenses | ' | ||||||
Licenses | ' | ||||||
Licenses | |||||||
Year Ended December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Balance, beginning of year | $ | 1,456,794 | $ | 1,470,769 | |||
Acquisitions | 16,540 | 122,690 | |||||
Divestitures | -59,419 | - | |||||
Transferred to Assets held for sale | -16,027 | -140,599 | |||||
Other | 3,238 | 3,934 | |||||
Balance, end of year | $ | 1,401,126 | $ | 1,456,794 | |||
Goodwill | ' | ||||||
Goodwill | ' | ||||||
Goodwill | |||||||
Year Ended December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Assigned value at time of acquisition | $ | 494,737 | $ | 494,737 | |||
Accumulated impairment losses in prior periods | - | - | |||||
Transferred to Assets held for sale | -72,994 | - | |||||
Balance, beginning of year | 421,743 | 494,737 | |||||
Divestitures | -505 | - | |||||
Transferred to Assets held for sale | - | -72,994 | |||||
NY1 & NY2 Deconsolidation | -33,714 | - | |||||
Balance, end of year | $ | 387,524 | $ | 421,743 |
Investment_in_Unconsolidated_E1
Investment in Unconsolidated Entities (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Equity Method Investment, Summarized Financial Information | ' | ||||||||||
Equity and cost method investments | ' | ||||||||||
December 31, | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Equity method investments: | |||||||||||
Capital contributions, loans, advances and adjustments | $ | 121,571 | $ | 10,323 | |||||||
Cumulative share of income | 1,152,916 | 1,017,449 | |||||||||
Cumulative share of distributions | -1,010,513 | -884,852 | |||||||||
263,974 | 142,920 | ||||||||||
Cost method investments | 1,611 | 1,611 | |||||||||
Total investments in unconsolidated entities | $ | 265,585 | $ | 144,531 | |||||||
Equity method investments, summarized financial position | ' | ||||||||||
December 31, | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Assets | |||||||||||
Current | $ | 489,659 | $ | 444,100 | |||||||
Due from affiliates | 408,735 | 298,707 | |||||||||
Property and other | 2,026,104 | 1,896,784 | |||||||||
$ | 2,924,498 | $ | 2,639,591 | ||||||||
Liabilities and Equity | |||||||||||
Current liabilities | $ | 351,624 | $ | 350,067 | |||||||
Deferred credits | 84,834 | 80,660 | |||||||||
Long-term liabilities | 19,712 | 21,328 | |||||||||
Long-term capital lease obligations | 707 | 405 | |||||||||
Partners' capital and shareholders' equity | 2,467,621 | 2,187,131 | |||||||||
$ | 2,924,498 | $ | 2,639,591 | ||||||||
Equity method investments, summarized results of operations | ' | ||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||
(Dollars in thousands) | |||||||||||
Results of Operations | |||||||||||
Revenues | $ | 6,218,067 | $ | 5,804,466 | $ | 5,519,024 | |||||
Operating expenses | 4,473,722 | 4,363,399 | 4,282,277 | ||||||||
Operating income | 1,744,345 | 1,441,067 | 1,236,747 | ||||||||
Other income, net | 4,842 | 4,003 | 4,976 | ||||||||
Net income | $ | 1,749,187 | $ | 1,445,070 | $ | 1,241,723 | |||||
Fair Value Key Assumptions | ' | ||||||||||
Key assumptions | |||||||||||
Average expected revenue growth rate (next ten years) | 2 | % | |||||||||
Terminal revenue growth rate (after year ten) | 2 | % | |||||||||
Discount rate | 10.5 | % | |||||||||
Capital expenditures as a percentage of revenue | 14.9-18.8 | % |
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Table) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Disclosure Text Block | ' | ||||||||
Property, plant and equipment | ' | ||||||||
December 31, | Useful Lives (Years) | 2013 | 2012 | ||||||
(Dollars in thousands) | |||||||||
Land | N/A | $ | 36,266 | $ | 33,947 | ||||
Buildings | 20 | 304,272 | 341,852 | ||||||
Leasehold and land improvements | 30-Jan | 1,197,520 | 1,188,720 | ||||||
Cell site equipment | 25-Jun | 3,306,575 | 3,100,916 | ||||||
Switching equipment | 8-Jan | 1,161,976 | 1,155,114 | ||||||
Office furniture and equipment | 5-Mar | 539,248 | 535,656 | ||||||
Other operating assets and equipment | 25-May | 92,456 | 128,290 | ||||||
System development | 7-Mar | 962,698 | 631,184 | ||||||
Work in process | N/A | 116,501 | 362,749 | ||||||
7,717,512 | 7,478,428 | ||||||||
Accumulated depreciation and amortization | -4,860,992 | -4,455,840 | |||||||
$ | 2,856,520 | $ | 3,022,588 |
Asset_Retirement_Obligations_T
Asset Retirement Obligations (Table) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Asset Retirement Obligation [Abstract] | ' | |||||||
Asset retirement obligations | ' | |||||||
(Dollars in thousands) | 2013 | 2012 | ||||||
Balance, beginning of period | $ | 179,607 | $ | 143,402 | ||||
Additional liabilities accrued | 635 | 5,578 | ||||||
Revisions in estimated cash outflows (1) | 6,268 | 22,588 | ||||||
Disposition of assets (2) | -3,534 | -2,674 | ||||||
Accretion expense (3) | 12,592 | 10,713 | ||||||
Balance, end of period (4) | $ | 195,568 | $ | 179,607 | ||||
-1 | Included increases of $14.9 million as a result of changes in expected settlement dates related to the Divestiture Transaction in 2012. | |||||||
-2 | Included $2.0 million of incremental disposition costs related to the Divestiture Transaction in 2013. | |||||||
-3 | Included $1.1 million and $0.2 million of incremental accretion related to the Divestiture Transaction in 2013 and 2012, respectively. | |||||||
-4 | In 2013, as a result of the accelerated settlement dates of certain asset retirement obligations related to the Divestiture Transaction, U.S. Cellular reclassified $37.7 million of its asset retirement obligations from Other deferred liabilities and credits to Other current liabilities. |
Debt_Table
Debt (Table) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||
Revolving credit facilities | ' | |||||||||||||||
The following table summarizes the terms of the revolving credit facility as of December 31, 2013: | ||||||||||||||||
(Dollars in millions) | ||||||||||||||||
Maximum borrowing capacity | $ | 300 | ||||||||||||||
Letters of credit outstanding (1) | $ | 17.6 | ||||||||||||||
Amount borrowed | $ | - | ||||||||||||||
Amount available for use | $ | 282.4 | ||||||||||||||
Borrowing rate: One-month London Interbank Offered Rate ("LIBOR") plus contractual spread (2) | 1.67 | % | ||||||||||||||
LIBOR | 0.17 | % | ||||||||||||||
Contractual spread | 1.5 | % | ||||||||||||||
Range of commitment fees on amount available for use (3) | ||||||||||||||||
Low | 0.13 | % | ||||||||||||||
High | 0.3 | % | ||||||||||||||
Agreement date | Dec-10 | |||||||||||||||
Maturity date | Dec-17 | |||||||||||||||
Fees incurred attributable to the Revolving Credit Facility are as follows: | ||||||||||||||||
Fees incurred as a percent of Maximum borrowing capacity for 2013 | 0.25 | % | ||||||||||||||
Fees incurred, amount | ||||||||||||||||
2013 | $ | 0.8 | ||||||||||||||
2012 | $ | 1.1 | ||||||||||||||
2011 | $ | 1.2 | ||||||||||||||
-1 | In June 2013, U.S. Cellular provided $17.4 million in letters of credit to the FCC in connection with U.S. Cellular's winning bids in Auction 901. See Note 16 — Supplemental Cash Flow Disclosures for additional information on Auction 901. | |||||||||||||||
-2 | Borrowings under the revolving credit facility bear interest at LIBOR plus a contractual spread based on U.S. Cellular’s credit rating or, at U.S. Cellular’s option, an alternate “Base Rate” as defined in the revolving credit agreement. U.S. Cellular may select a borrowing period of either one, two, three or six months (or other period of twelve months or less if requested by U.S. Cellular and approved by the lenders). If U.S. Cellular provides notice of intent to borrow less than three business days in advance of a borrowing, interest on borrowing is at the Base Rate plus the contractual spread. | |||||||||||||||
-3 | The revolving credit facility has commitment fees based on the unsecured senior debt ratings assigned to U.S. Cellular by certain ratings agencies. | |||||||||||||||
Long term debt | ' | |||||||||||||||
Long-Term Debt | ||||||||||||||||
Long-term debt as of December 31, 2013 and 2012 was as follows: | ||||||||||||||||
December 31, | ||||||||||||||||
(Dollars in thousands) | Issuance date | Maturity date | Call date | 2013 | 2012 | |||||||||||
Unsecured Senior Notes | ||||||||||||||||
6.70% | December 2003 and June 2004 | Dec-33 | Dec-03 | $ | 544,000 | $ | 544,000 | |||||||||
Less: 6.7% Unamortized discount | -11,551 | -11,806 | ||||||||||||||
532,449 | 532,194 | |||||||||||||||
6.95% | May-11 | May-60 | May-16 | 342,000 | 342,000 | |||||||||||
Obligation on capital leases | 3,749 | 4,756 | ||||||||||||||
Total long-term debt | $ | 878,198 | $ | 878,950 | ||||||||||||
Long-term debt, current | $ | 166 | $ | 92 | ||||||||||||
Long-term debt, noncurrent | $ | 878,032 | $ | 878,858 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||
Lease Commitments | ' | |||||
Operating Leases Future Minimum Rental Payments | Operating Leases Future Minimum Rental Receipts | |||||
(Dollars in thousands) | ||||||
2014 | $ | 152,349 | $ | 46,357 | ||
2015 | 134,852 | 36,847 | ||||
2016 | 116,397 | 26,201 | ||||
2017 | 97,098 | 17,226 | ||||
2018 | 79,166 | 6,521 | ||||
Thereafter | 783,730 | 227 | ||||
Total | $ | 1,363,592 | $ | 133,379 |
Variable_Interest_Entities_VIE
Variable Interest Entities VIEs (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Variable Interest Entities VIEs | ' | ||||||
Consolidated VIE assets and liabilities | ' | ||||||
December 31, | 2013 | 2012 | |||||
(Dollars in thousands) | |||||||
Assets | |||||||
Cash and cash equivalents | $ | 2,076 | $ | 5,849 | |||
Other current assets | 1,184 | 120 | |||||
Licenses | 310,475 | 308,091 | |||||
Property, plant and equipment, net | 18,600 | 16,443 | |||||
Other assets and deferred charges | 511 | 887 | |||||
Total assets | $ | 332,846 | $ | 331,390 | |||
Liabilities | |||||||
Current liabilities | $ | 46 | $ | 1,013 | |||
Deferred liabilities and credits | 3,139 | 3,024 | |||||
Total liabilities | $ | 3,185 | $ | 4,037 |
Common_Shareholders_Equity_Tab
Common Shareholders' Equity (Table) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Common Shareholders' Equity | ' | ||||||||||
Share repurchases | ' | ||||||||||
Year Ended December 31, | Number of Shares | Average Cost Per Share | Total Cost | ||||||||
(Dollar amounts and shares in thousands) | |||||||||||
2013 | |||||||||||
U.S. Cellular Common Shares | 499 | $ | 37.19 | $ | 18,544 | ||||||
2012 | |||||||||||
U.S. Cellular Common Shares | 571 | $ | 35.11 | $ | 20,045 | ||||||
2011 | |||||||||||
U.S. Cellular Common Shares | 1,276 | $ | 48.82 | $ | 62,294 |
StockBased_Compensation_Table
Stock-Based Compensation (Table) | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Stock based compensation | ' | ||||||||||||||
Stock-based compensation, fair value assumptions | ' | ||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
Expected life | 4.6-9.0 years | 4.5 years | 4.3 years | ||||||||||||
Expected volatility | 29.2%-39.6% | 40.7%-42.6% | 43.4%-44.8% | ||||||||||||
Dividend yield | 0% | 0% | 0% | ||||||||||||
Risk-free interest rate | 0.7%-2.4% | 0.5%-0.9% | 0.7%-2.0% | ||||||||||||
Estimated annual forfeiture rate | 0.0%-8.1% | 0.0%-9.1% | 0.0%-7.8% | ||||||||||||
Summary of stock options | ' | ||||||||||||||
Common Share Options | Number of Options | Weighted Average Exercise Price | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value | Weighted Average Remaining Contractual Life (in years) | ||||||||||
Outstanding at December 31, 2010 | 2,627,000 | $ | 42.28 | ||||||||||||
(1,333,000 exercisable) | 47.18 | ||||||||||||||
Granted | 694,000 | 44.34 | $ | 16.66 | |||||||||||
Exercised | -201,000 | 32.32 | $ | 2,099,000 | |||||||||||
Forfeited | -83,000 | 39.42 | |||||||||||||
Expired | -203,000 | 49.32 | |||||||||||||
Outstanding at December 31, 2011 | 2,834,000 | $ | 43.07 | ||||||||||||
(1,533,000 exercisable) | 46.23 | ||||||||||||||
Granted | 677,000 | 34.91 | $ | 12.61 | |||||||||||
Exercised | -47,000 | 29.82 | $ | 205,000 | |||||||||||
Forfeited | -117,000 | 38.45 | |||||||||||||
Expired | -133,000 | 46.17 | |||||||||||||
Outstanding at December 31, 2012 | 3,214,000 | $ | 41.58 | ||||||||||||
(1,928,000 exercisable) | $ | 43.99 | |||||||||||||
Granted | 1,213,000 | 32.45 | $ | 11.53 | |||||||||||
Exercised | -892,000 | 34.78 | $ | 6,787,000 | |||||||||||
Forfeited | -574,000 | 34.17 | |||||||||||||
Expired | -247,000 | 48.35 | |||||||||||||
Outstanding at December 31, 2013 | 2,714,000 | $ | 42.22 | $ | 13,015,000 | 6.8 | |||||||||
(1,359,000 exercisable) | $ | 46.91 | $ | 2,632,000 | 4.6 | ||||||||||
Summary of nonvested restricted stock units | ' | ||||||||||||||
Common Restricted Stock Units | Number | Weighted Average Grant Date Fair Value | |||||||||||||
Nonvested at December 31, 2012 | 1,139,000 | $ | 38.4 | ||||||||||||
Granted | 601,000 | 32.06 | |||||||||||||
Vested | -238,000 | 42.26 | |||||||||||||
Forfeited | -332,000 | 35.63 | |||||||||||||
Nonvested at December 31, 2013 | 1,170,000 | $ | 36.46 | ||||||||||||
Stock-based compensation | ' | ||||||||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Stock option awards | $ | 5,810 | $ | 8,471 | $ | 9,549 | |||||||||
Restricted stock unit awards | 9,485 | 12,300 | 10,037 | ||||||||||||
Deferred compensation bonus and matching stock unit awards | 2 | 240 | 12 | ||||||||||||
Awards under employee stock purchase plan | - | - | 255 | ||||||||||||
Awards under Non-Employee Director compensation plan | 547 | 455 | 330 | ||||||||||||
Total stock-based compensation, before income taxes | 15,844 | 21,466 | 20,183 | ||||||||||||
Income tax benefit | -5,984 | -8,121 | -7,581 | ||||||||||||
Total stock-based compensation expense, net of income taxes | $ | 9,860 | $ | 13,345 | $ | 12,602 | |||||||||
Stock-based compensation, allocation by financial statement line item | ' | ||||||||||||||
December 31, | 2013 | 2012 | 2011 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Selling, general and administrative expense | $ | 12,933 | $ | 18,437 | $ | 17,538 | |||||||||
System operations | 2,911 | 3,029 | 2,645 | ||||||||||||
Total stock-based compensation expense | $ | 15,844 | $ | 21,466 | $ | 20,183 |
Supplemental_Cash_Flow_Disclos1
Supplemental Cash Flow Disclosures (Table) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Supplemental Cash Flow Disclosures | ' | |||||||||
Supplemental cash flow disclosures | ' | |||||||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars in thousands) | ||||||||||
Interest paid | $ | 42,904 | $ | 44,048 | $ | 55,580 | ||||
Income taxes paid (refunded) | $ | 157,778 | $ | -58,609 | $ | -54,469 | ||||
Year Ended December 31, | 2013 | 2012 | 2011 | |||||||
(Dollars in thousands) | ||||||||||
Common Shares withheld | 606,582 | 92,846 | 120,250 | |||||||
Aggregate value of Common Shares withheld | $ | 25,179 | $ | 3,604 | $ | 5,952 | ||||
Cash receipts upon exercise of stock options | 10,468 | 900 | 5,447 | |||||||
Cash disbursements for payment of taxes | -4,684 | -3,105 | -3,512 | |||||||
Net cash receipts (disbursements) from exercise of stock options and vesting of other stock awards | $ | 5,784 | $ | -2,205 | $ | 1,935 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
number | |||
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
Number of customers | 4,800,000 | ' | ' |
Short-term investments | $50,104,000 | $100,676,000 | ' |
Long-term investments | ' | 50,305,000 | ' |
Agent liability | 121,300,000 | 88,200,000 | ' |
Amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities | 114,700,000 | 135,700,000 | 125,200,000 |
Advertising costs | 199,900,000 | 227,000,000 | 257,800,000 |
Accumulated amortization of deferred charges | 26,000,000 | 12,700,000 | ' |
TDS | ' | ' | ' |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
TDS ownership of U.S. Cellular | 84.00% | ' | ' |
Income taxes (payable) | -34,800,000 | -1,100,000 | ' |
401(k) | ' | ' | ' |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
Defined contribution cost | 15,400,000 | 17,100,000 | 15,500,000 |
Pension | ' | ' | ' |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
Defined contribution cost | 10,400,000 | 12,400,000 | 11,600,000 |
Allowance for doubtful accounts | ' | ' | ' |
Accounts receivable | ' | ' | ' |
Allowance for doubtful accounts, beginning balance | 26,902,000 | 23,537,000 | 25,816,000 |
Additions, net of recoveries | 98,864,000 | 67,372,000 | 62,157,000 |
Deductions | -65,528,000 | -64,007,000 | -64,436,000 |
Allowance for doubtful accounts, ending balance | 60,238,000 | 26,902,000 | 23,537,000 |
Loyalty Rewards Program | ' | ' | ' |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
Change in accounting estimate, financial effect | 'As of December 31, 2013, U.S. Cellular estimated loyalty reward points breakage based on actuarial estimates and recorded a $7.4 million change in estimate, which reduced Customer deposits and deferred revenues in the Consolidated Balance Sheet and increased Service revenues in the Consolidated Statement of Operations. | ' | ' |
Deferred revenue | 116,200,000 | 56,600,000 | ' |
Loyalty Rewards Program | Special issuance | ' | ' | ' |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | ' | ' | ' |
Deferred revenue | $43,500,000 | ' | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | 6.7% Senior Notes | 6.7% Senior Notes | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | ||||
Level 1 | Level 1 | Level 1 | Level 1 | Level 2 | Level 2 | U.S. Treasury Notes | U.S. Treasury Notes | 6.95% Senior Notes | 6.95% Senior Notes | 6.7% Senior Notes | 6.7% Senior Notes | U.S. Treasury Notes | U.S. Treasury Notes | |||||||||
6.95% Senior Notes | 6.95% Senior Notes | 6.7% Senior Notes | 6.7% Senior Notes | Level 1 | Level 1 | |||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $342,065 | $378,358 | $424,155 | $276,915 | ' | ' | $342,065 | $378,358 | ' | ' | ' | ' | ' | ' | $342,065 | $378,358 | ' | ' | ' | ' | ' | ' |
Short-term investments | 50,104 | 100,676 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,104 | 100,676 | ' | ' | ' | ' | ' | ' | 50,104 | 100,676 |
Long-term investments | ' | 50,305 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,339 | ' | ' | ' | ' | ' | ' | ' | 50,305 |
Long-term debt | ' | ' | ' | ' | ' | ' | ' | ' | $309,852 | $376,610 | $507,697 | $582,744 | ' | ' | ' | ' | $342,000 | $342,000 | $532,449 | $532,194 | ' | ' |
Fair value assumption, interest rate | ' | ' | ' | ' | 7.35% | 6.09% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income_Taxes_Receivable_Detail
Income Taxes, Receivable (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure | ' | ' |
Income taxes receivable | ' | $1,612 |
State | ' | ' |
Income Tax Disclosure | ' | ' |
Income taxes receivable | ' | 1,612 |
Income taxes (payable) | -1,545 | ' |
Federal | ' | ' |
Income Tax Disclosure | ' | ' |
Income taxes (payable) | ($32,351) | ($1,614) |
Income_Taxes_Expense_Details
Income Taxes, Expense (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income tax expense | ' | ' | ' |
Current federal income tax expense | $180,056 | $10,547 | ($90,235) |
Current state income tax expense | 8,426 | 4,186 | 1,049 |
Deferred federal income tax expense | -69,917 | 54,490 | 187,581 |
Deferred state income tax expense | -5,431 | -5,246 | 15,683 |
Total income tax expense | $113,134 | $63,977 | $114,078 |
Income_Taxes_Expense_Reconcili
Income Taxes, Expense Reconciliation (Details) (USD $) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Income tax expense reconciliation | ' | ' | ' | |||
Statutory federal income tax expense | $90,200,000 | $71,800,000 | $109,500,000 | |||
State income taxes, net of federal benefit | 5,200,000 | [1] | 3,700,000 | [1] | 4,500,000 | [1] |
Effect of noncontrolling interests | -2,200,000 | -6,300,000 | -4,900,000 | |||
Gains (losses) on investments sales of assets | 20,500,000 | [2] | ' | ' | ||
Correction of deferred taxes | ' | -5,300,000 | [3] | 6,100,000 | [3] | |
Other differences, net | -600,000 | 100,000 | -1,100,000 | |||
Total income tax expense | $113,134,000 | $63,977,000 | $114,078,000 | |||
[1] | Net state income taxes include changes in the valuation allowance. In addition, state tax benefits related to the settlement of state tax audits and the expiration of statutes of limitations are included in 2013, 2012 and 2011. | |||||
[2] | Represents 2013 tax expense related to the NY1 & NY2 Deconsolidation and the Divestiture Transaction. | |||||
[3] | U.S. Cellular recorded immaterial adjustments to correct deferred tax balances in 2012 and 2011 related to tax basis and law changes that related to periods prior to 2012 and 2011, respectively. |
Income_Taxes_Rate_Reconciliati
Income Taxes, Rate Reconciliation (Details) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Income tax rate reconciliation | ' | ' | ' | |||
Statutory federal income tax rate | 35.00% | 35.00% | 35.00% | |||
Effect of state income tax, net of federal benefit | 2.00% | [1] | 1.80% | [1] | 1.40% | [1] |
Effect of noncontrolling interests on income tax rate | -0.90% | -3.10% | -1.60% | |||
Gains (losses) on investments and sales of assets on income tax rate | 8.00% | [2] | ' | ' | ||
Effect of correction of deferred taxes on income tax rate | ' | -2.60% | [3] | 2.00% | [3] | |
Other differences effect on income tax rate | -0.20% | 0.10% | -0.30% | |||
Total income tax rate | 43.90% | 31.20% | 36.50% | |||
[1] | Net state income taxes include changes in the valuation allowance. In addition, state tax benefits related to the settlement of state tax audits and the expiration of statutes of limitations are included in 2013, 2012 and 2011. | |||||
[2] | Represents 2013 tax expense related to the NY1 & NY2 Deconsolidation and the Divestiture Transaction. | |||||
[3] | U.S. Cellular recorded immaterial adjustments to correct deferred tax balances in 2012 and 2011 related to tax basis and law changes that related to periods prior to 2012 and 2011, respectively. |
Income_Taxes_Components_of_Def
Income Taxes, Components of Deferred Income Tax (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Components Of Deferred Tax Assets And Liabilities Abstract | ' | ' |
Net current deferred income tax asset | $99,105 | $35,419 |
Noncurrent deferred income tax assets | ' | ' |
Net operating loss ("NOL") carryforwards | 61,294 | 63,240 |
Stock-based compensation | 19,028 | 22,411 |
Compensation and benefits, other | 3,746 | 13,673 |
Deferred rent | 19,462 | 15,822 |
Other | 24,604 | 25,432 |
Gross noncurrent deferred income tax assets | 128,134 | 140,578 |
Deferred tax assets valuation allowance noncurrent | -40,392 | -40,208 |
Total noncurrent deferred tax assets | 87,742 | 100,370 |
Noncurrent deferred income tax liabilities | ' | ' |
Property, plant and equipment | 503,491 | 527,547 |
Licenses/intangibles | 282,764 | 294,738 |
Partnership investments | 133,931 | 124,221 |
Other | 3,853 | 3,682 |
Total noncurrent deferred tax liabilities | 924,039 | 950,188 |
Net noncurrent deferred income tax liability | $836,297 | $849,818 |
Income_Taxes_Net_Operating_Los
Income Taxes, Net Operating Losses (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
State | ' |
Operating Loss Carryforwards [Line Items] | ' |
State NOL carryforwards | 1,149.40 |
Deferred tax asset for State NOL carryforwards | 51.1 |
State | Minimum | ' |
Operating Loss Carryforwards [Line Items] | ' |
Expiration of NOL carryforwards | 31-Dec-14 |
State | Maximum | ' |
Operating Loss Carryforwards [Line Items] | ' |
Expiration of NOL carryforwards | 31-Dec-33 |
Federal | ' |
Operating Loss Carryforwards [Line Items] | ' |
Deferred tax asset for Federal NOL carryforward (entities not on Federal return) | 10.2 |
Federal | Minimum | ' |
Operating Loss Carryforwards [Line Items] | ' |
Expiration of NOL carryforwards | 31-Dec-18 |
Federal | Maximum | ' |
Operating Loss Carryforwards [Line Items] | ' |
Expiration of NOL carryforwards | 31-Dec-33 |
Income_Taxes_Deferred_Tax_Valu
Income Taxes, Deferred Tax Valuation Allowance (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Deferred tax valuation allowance, rollfoward | ' | ' | ' |
Deferred tax assets, valuation allowance, current | $3,000,000 | ' | ' |
Deferred tax assets valuation allowance noncurrent | 40,392,000 | 40,208,000 | ' |
Deferred tax asset valuation allowance | ' | ' | ' |
Deferred tax valuation allowance, rollfoward | ' | ' | ' |
Balance at beginning of period | 41,295,000 | 30,261,000 | 29,891,000 |
Charged to income tax expense | -1,527,000 | 3,033,000 | -1,450,000 |
Charged to other accounts | 3,607,000 | 8,001,000 | 1,820,000 |
Balance at end of period | $43,375,000 | $41,295,000 | $30,261,000 |
Income_Taxes_Unrecognized_Tax_
Income Taxes, Unrecognized Tax Benefits (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Summary of unrecognized income tax benefits | ' | ' | ' |
Unrecognized tax benefit, beginning balance | $26,460,000 | $28,745,000 | $32,547,000 |
Additions for tax positions of current year | 5,925,000 | 6,656,000 | 4,487,000 |
Additions for tax positions of prior years | 1,501,000 | 854,000 | 332,000 |
Reductions for tax positions of prior years | -45,000 | -115,000 | -1,104,000 |
Reductions for settlements of tax positions | -576,000 | ' | -244,000 |
Reductions for lapses in statutes of limitations | -4,452,000 | -9,680,000 | -7,273,000 |
Unrecognized tax benefit, ending balance | 28,813,000 | 26,460,000 | 28,745,000 |
Effect of unrecognized tax benefit on income tax expense | $18,700,000 | $17,200,000 | $18,700,000 |
Income_Taxes_Additional_Disclo
Income Taxes, Additional Disclosures (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure | ' | ' | ' |
Net accrued interest and penalties, total | $12.30 | $12.80 | ' |
Accrued interest and penalties related to unrecognized income tax benefits | $0.60 | ($2.20) | ($2.60) |
State | ' | ' | ' |
Income Tax Disclosure | ' | ' | ' |
Open tax years by major tax jurisdiction | '2009 | ' | ' |
Federal | ' | ' | ' |
Income Tax Disclosure | ' | ' | ' |
Open tax years by major tax jurisdiction | '2011 | ' | ' |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Earnings per share | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | $140,038 | $111,006 | $175,041 |
Weighted average number of shares used in basic earnings per share | ' | ' | ' |
Weighted average number of shares used in basic earnings per share | 83,968 | 84,645 | 84,877 |
Effect of dilutive securities: | ' | ' | ' |
Stock options | 211 | 184 | 224 |
Restricted stock units | 551 | 401 | 347 |
Weighted average number of shares used in diluted earnings per share | 84,730 | 85,230 | 85,448 |
Earnings per share, Other disclosures | ' | ' | ' |
Basic earnings per share attributable to U.S. Cellular shareholders | $1.67 | $1.31 | $2.06 |
Diluted earnings per share attributable to U.S. Cellular shareholders | $1.65 | $1.30 | $2.05 |
Dividend payable date | 25-Jun-13 | ' | ' |
Dividend date of record | 11-Jun-13 | ' | ' |
Series A Common and Common Shares, dividends per share paid | $5.75 | ' | ' |
Series A Common and Common Shares, dividends paid | $482,270 | ' | ' |
Stock Options | ' | ' | ' |
Earnings per share, Other disclosures | ' | ' | ' |
Antidilutive securities | 2,010 | 2,123 | 1,591 |
Restricted Stock Units | ' | ' | ' |
Earnings per share, Other disclosures | ' | ' | ' |
Antidilutive securities | 190 | 369 | 250 |
Acquisitions_Divestitures_and_2
Acquisitions, Divestitures and Exchanges, acquisitions (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Business Acquisitions | Business Acquisitions | License Acquisitions | License Acquisitions | License Acquisitions | License Acquisitions | License Acquisitions | License Acquisitions | |||
700 MHz Acquisition 1 | 700 MHz Acquisition 1 | 700 MHz Acquisition 2 | 700 MHz Acquisition 2 | |||||||
Acquisitions, divestitures and exchanges | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Licenses | $1,401,126,000 | $1,456,794,000 | ' | ' | $16,540,000 | $122,690,000 | ' | $34,000,000 | ' | $57,700,000 |
Purchase price | ' | ' | ' | 24,600,000 | 16,540,000 | 122,690,000 | ' | ' | ' | ' |
Date of acquisition | ' | ' | ' | 9-May-11 | ' | ' | ' | 15-Aug-12 | ' | 20-Nov-12 |
Description of acquired entity | ' | ' | 'On May 9, 2011, pursuant to certain required terms of the partnership agreement, U.S. Cellular paid $24.6 million in cash to purchase the remaining ownership interest in this wireless market in which it previously held a 49% noncontrolling interest. In connection with the acquisition of the remaining interest, a $13.4 million gain was recorded to adjust the carrying value of this 49% investment to its fair value of $25.7 million based on an income approach valuation method. The gain was recorded in Gain (loss) on investments in the Consolidated Statement of Operations in 2011. | ' | ' | ' | 'On August 15, 2012, U.S. Cellular acquired four 700 MHz licenses covering portions of Iowa, Kansas, Missouri, Nebraska and Oklahoma for $34.0 million. | ' | 'On November 20, 2012, U.S. Cellular acquired seven 700 MHz licenses covering portions of Illinois, Michigan, Minnesota, Missouri, Nebraska, Oregon, Washington and Wisconsin for $57.7 million. | ' |
Fair value equity investment prior to acquisition | ' | ' | ' | 25,700,000 | ' | ' | ' | ' | ' | ' |
Gain on equity investment remeasurement | ' | ' | ' | $13,400,000 | ' | ' | ' | ' | ' | ' |
Ownership interest in equity method investment | ' | ' | ' | 49.00% | ' | ' | ' | ' | ' | ' |
Valuation technique | ' | ' | 'income approach valuation method | ' | ' | ' | ' | ' | ' | ' |
Acquisitions_Divestitures_and_3
Acquisitions, Divestitures and Exchanges, divestitures (Details) (USD $) | 12 Months Ended | 3 Months Ended | 12 Months Ended | 14 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 26 Months Ended | 12 Months Ended | 26 Months Ended | 12 Months Ended | 14 Months Ended | 12 Months Ended | 24 Months Ended | 3 Months Ended | 12 Months Ended | 14 Months Ended | 24 Months Ended | 12 Months Ended | ||||||||||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | ||||||||
Divestiture transaction | Divestiture transaction | Divestiture transaction | Divestiture transaction | Bolingbrook customer care center | Bolingbrook customer care center | Wireless market | Wireless market | Mississippi Valley | St. Louis | Expected event | Minimum | Minimum | Maximum | Maximum | Purchase price | Purchase price | Purchase price | Purchase price | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Employee related costs including severance, retention and outplacement | Employee related costs including severance, retention and outplacement | Contract termination costs | Contract termination costs | Contract termination costs | ||||||||||||
Divestiture | St. Louis | Divestiture transaction | Expected event | Divestiture transaction | Expected event | Divestiture transaction | Divestiture transaction | Minimum | Maximum | Divestiture transaction | Maximum | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | System operations | Divestiture transaction | Divestiture transaction | Other current liabilities | Other current liabilities | Other deferred liabilities and credits | |||||||||||||||||||||
Divestiture transaction | Divestiture transaction | Divestiture transaction | Divestiture transaction | Cash received from divestitures | Expected event | Divestiture transaction | Divestiture transaction | Divestiture transaction | Minimum | Maximum | Maximum | Divestiture transaction | Divestiture transaction | Divestiture transaction | |||||||||||||||||||||||||||||
Divestiture transaction | Expected event | Expected event | Expected event | ||||||||||||||||||||||||||||||||||||||||
Divestiture transaction | Divestiture transaction | Divestiture transaction | |||||||||||||||||||||||||||||||||||||||||
Divestitures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Business divestiture date | ' | ' | ' | ' | 16-May-13 | ' | ' | ' | 1-Jan-13 | ' | 14-Mar-12 | 4-Oct-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Business divestiture description | ' | ' | ' | ' | 'On November 6, 2012, U.S. Cellular entered into a Purchase and Sale Agreement with subsidiaries of Sprint Corp., fka Sprint Nextel Corporation (“Sprint”). Pursuant to the Purchase and Sale Agreement, on May 16, 2013, U.S. Cellular transferred customers and certain PCS license spectrum to Sprint in U.S. Cellular’s Chicago, central Illinois, St. Louis and certain Indiana/Michigan/Ohio markets (“Divestiture Markets”) in consideration for $480 million in cash. The Purchase and Sale Agreement also contemplated certain other agreements, together with the Purchase and Sale Agreement collectively referred to as the “Divestiture Transaction.” U.S. Cellular retained other assets and liabilities related to the Divestiture Markets, including network assets, retail stores and related equipment, and other buildings and facilities. The transaction did not affect spectrum licenses held by U.S. Cellular or variable interest entities (“VIEs”) that were not used in the operations of the Divestiture Markets. Pursuant to the Purchase and Sale Agreement, U.S. Cellular and Sprint also entered into certain other agreements, including customer and network transition services agreements, which require U.S. Cellular to provide customer, billing and network services to Sprint for a period of up to 24 months after the May 16, 2013 closing date. Sprint will reimburse U.S. Cellular for providing such services at an amount equal to U.S. Cellular’s estimated costs, including applicable overhead allocations. In addition, these agreements require Sprint to reimburse U.S. Cellular up to $200 million (the “Sprint Cost Reimbursement”) for certain network decommissioning costs, network site lease rent and termination costs, network access termination costs, and employee termination benefits for specified engineering employees. | ' | ' | ' | 'Effective January 1, 2013, U.S. Cellular transferred its Bolingbrook Customer Care Center operations to an existing third party vendor. | 'On March 14, 2012, U.S. Cellular sold the majority of the assets and liabilities of a wireless market for $49.8 million in cash. At the time of the sale, a $4.2 million gain was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations. | ' | 'On October 4, 2013, U.S. Cellular sold the majority of its Mississippi Valley non-operating market license (“unbuilt license”) for $308.0 million. At the time of the sale, a $250.6 million gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Business divestiture agreement description | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'On August 14, 2013 U.S. Cellular entered into a definitive agreement to sell the majority of its St. Louis area unbuilt license for $92.3 million. This transaction is subject to regulatory approval and is expected to close in the first quarter of 2014. In accordance with GAAP, the book value of the license has been accounted for and disclosed as “held for sale” in the Consolidated Balance Sheet at December 31, 2013. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Business divestiture agreement date | ' | ' | ' | ' | 6-Nov-12 | ' | ' | ' | ' | ' | ' | ' | 14-Aug-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Transition services agreement duration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '24M | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
(Increase) decrease in Operating Income | ($146,865) | ($156,656) | ($280,780) | $41,324 | ($69,926) | $44,535 | ($25,391) | ' | ' | ' | ' | ' | ' | ' | ' | ($49,407) | ' | ($18,407) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
(Gain) loss on license sales and exchanges | -255,479 | ' | -11,762 | ' | ' | ' | ' | ' | ' | ' | ' | -250,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Divestiture Financial Impacts | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Cash received from divestitures | -811,120 | -49,932 | ' | ' | ' | ' | ' | ' | ' | ' | -49,800 | -308,000 | ' | -92,300 | ' | ' | ' | ' | -480,000 | -480,000 | -480,000 | -480,000 | -10,600 | -200,000 | -43,420 | -47,641 | -47,641 | -120,000 | -175,000 | -25,000 | ' | ' | ' | ' | ' | ||||||||
Net assets transferred | ' | ' | ' | ' | 213,593 | ' | 213,593 | ' | ' | ' | ' | ' | ' | ' | 213,593 | ' | 213,593 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Non-cash charges for the write-off and write-down of property under construction and related assets | ' | ' | ' | -51 | 3 | 10,672 | 10,675 | ' | ' | ' | ' | ' | ' | ' | ' | 10,000 | ' | 14,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Employee related costs including severance, retention and outplacement | ' | ' | ' | -809 | 1,653 | 12,609 | 14,262 | ' | ' | ' | ' | ' | ' | ' | ' | 12,000 | ' | 18,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Contract termination costs | ' | ' | ' | 40,744 | 59,525 | 59 | 59,584 | ' | ' | ' | ' | ' | ' | ' | ' | 110,000 | ' | 160,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Transaction costs | ' | ' | ' | 347 | 4,428 | 1,137 | 5,565 | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | ' | 6,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Total (Gain) loss on sale of business and other exit costs, net | -246,767 | 21,022 | ' | -3,189 | -248,439 | 24,477 | -223,962 | ' | ' | ' | -4,200 | ' | ' | ' | ' | -249,407 | ' | -243,407 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Incremental depreciation, amortization and accretion, net of salvage values | 803,781 | 608,633 | 573,557 | 44,513 | 178,513 | 20,058 | 198,571 | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | 225,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Balance Sheet rollforward | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Balance, beginning of period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,305 | ' | 30 | ' | ' | ||||||||
Costs incurred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,853 | 12,609 | 22,675 | 59 | 34,283 | ||||||||
Cash settlements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -11,905 | [1] | -304 | [1] | -8,713 | [1] | -29 | [1] | -3,434 | [1] | |||
Adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -5,200 | [2] | ' | ' | ' | ' | |||||||
Balance, end of period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,053 | 12,305 | 13,992 | 30 | 30,849 | ||||||||
Assets and liabilities held for sale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Licenses | ' | 140,599 | ' | ' | ' | 140,599 | ' | ' | ' | ' | ' | ' | 16,027 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Goodwill | ' | 72,994 | ' | ' | ' | 72,994 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||
Property, plant and equipment | ' | 4,275 | ' | ' | ' | ' | ' | 4,275 | [3] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||
Loss on assets held for sale | ' | -1,105 | [4] | ' | ' | ' | ' | ' | -1,105 | [3],[4] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
Total Assets held for sale | 16,027 | 216,763 | ' | ' | ' | 213,593 | ' | 3,170 | [3] | ' | ' | ' | ' | 16,027 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||
Liabilities held for sale | ' | $19,594 | ' | ' | ' | $19,594 | [5] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||
[1] | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | ||||||||||||||||||||||||||||||||||||||||||
[2] | Adjustment to liability represents changes to previously accrued amounts. | ||||||||||||||||||||||||||||||||||||||||||
[3] | Effective January 1, 2013, U.S. Cellular transferred its Bolingbrook Customer Care Center operations to an existing third party vendor. | ||||||||||||||||||||||||||||||||||||||||||
[4] | Loss on assets held for sale was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations. | ||||||||||||||||||||||||||||||||||||||||||
[5] | Liabilities held for sale primarily consisted of Customer deposits and deferred revenues. |
Acquisitions_Divestitures_and_4
Acquisitions, Divestitures and Exchanges, exchanges (Details) (Spectrum exchange, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2011 |
Spectrum exchange | ' | ' |
Exchanges | ' | ' |
Agreement date | ' | 30-Sep-11 |
Asset exchange description | 'On September 30, 2011, U.S. Cellular completed an exchange whereby U.S. Cellular received eighteen 700 MHz spectrum licenses covering portions of Idaho, Illinois, Indiana, Kansas, Nebraska, Oregon and Washington in exchange for two PCS spectrum licenses covering portions of Illinois and Indiana. The exchange of licenses provided U.S. Cellular with additional spectrum to meet anticipated future capacity and coverage requirements in several of its markets. No cash, customers, network assets, other assets or liabilities were included in the exchange. As a result of this transaction, U.S. Cellular recognized a gain of $11.8 million, representing the difference between the fair value of the licenses received, calculated using a market approach valuation method, and the carrying value of the licenses surrendered. This gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the year ended December 31, 2011. | ' |
Gain on asset exchange | ' | $11.80 |
Asset exchange, valuation method | 'market approach valuation method | ' |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Licenses | ' | ' |
Balance, beginning of period | $1,456,794 | $1,470,769 |
Acquisitions | 16,540 | 122,690 |
Divestitures | -59,419 | ' |
Transferred to Assets held for sale | -16,027 | -140,599 |
Other | 3,238 | 3,934 |
Balance, end of period | 1,401,126 | 1,456,794 |
Goodwill | ' | ' |
Assigned value at time of acquisition | 494,737 | 494,737 |
Transferred to Assets held for sale | -72,994 | ' |
Balance, beginning of period | 421,743 | 494,737 |
Divestitures | -505 | ' |
Transferred to Assets held for sale | ' | -72,994 |
NY1 & NY2 Deconsolidation | -33,714 | ' |
Balance, end of period | $387,524 | $421,743 |
Investments_in_Unconsolidated_
Investments in Unconsolidated Entities (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Equity and cost method investments | ' | ' | ' |
Capital contributions, loans, advances and adjustments | $121,571 | $10,323 | ' |
Cumulative share of income | 1,152,916 | 1,017,449 | ' |
Cumulative share of distributions | -1,010,513 | -884,852 | ' |
Equity method investments | 263,974 | 142,920 | ' |
Cost method investments | 1,611 | 1,611 | ' |
Total investments in unconsolidated entities | 265,585 | 144,531 | ' |
Equity in earnings of unconsolidated entities | 131,949 | 90,364 | 83,566 |
Los Angeles SMSA Limited Partnership | ' | ' | ' |
Equity and cost method investments | ' | ' | ' |
Equity in earnings of unconsolidated entities | 78,400 | 67,200 | 55,300 |
Ownership interest in equity method investment | 5.50% | 5.50% | 5.50% |
Aggregate equity method investments | ' | ' | ' |
Equity method investments, combined assets | ' | ' | ' |
Current | 489,659 | 444,100 | ' |
Due from affiliates | 408,735 | 298,707 | ' |
Property and other | 2,026,104 | 1,896,784 | ' |
Total assets | 2,924,498 | 2,639,591 | ' |
Equity method investments, combined liabilities and equity | ' | ' | ' |
Current liabilities | 351,624 | 350,067 | ' |
Deferred credits | 84,834 | 80,660 | ' |
Long-term liabilities | 19,712 | 21,328 | ' |
Long-term capital lease obligations | 707 | 405 | ' |
Partners' capital and shareholders' equity | 2,467,621 | 2,187,131 | ' |
Total liabilities and equity | 2,924,498 | 2,639,591 | ' |
Equity method investments, combined income statements | ' | ' | ' |
Revenues | 6,218,067 | 5,804,466 | 5,519,024 |
Operating expenses | 4,473,722 | 4,363,399 | 4,282,277 |
Operating income | 1,744,345 | 1,441,067 | 1,236,747 |
Other income, net | 4,842 | 4,003 | 4,976 |
Net income | $1,749,187 | $1,445,070 | $1,241,723 |
Investment_in_Unconsolidated_E2
Investment in Unconsolidated Entities, Deconsolidation (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Apr. 03, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
St. Lawrence Seaway RSA Cellular Partnership | New York RSA 2 Cellular Partnership | St. Lawrence Seaway RSA Cellular Partnership and New York RSA 2 Cellular Partnership | St. Lawrence Seaway RSA Cellular Partnership and New York RSA 2 Cellular Partnership | Discounted cash flow valuation approach | Discounted cash flow valuation approach | Discounted cash flow valuation approach | |||
Minimum | Maximum | ||||||||
Fair Value Inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average expected revenue growth rate (next ten years) | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' |
Terminal revenue growth rate (after year ten) | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' |
Discount rate | ' | ' | ' | ' | ' | ' | 10.50% | ' | ' |
Capital expenditures as a percentage of revenue | ' | ' | ' | ' | ' | ' | ' | 14.90% | 18.80% |
Deconsolidation of New York Partnerships | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of deconsolidation | ' | ' | ' | ' | 3-Apr-13 | ' | ' | ' | ' |
Ownership interest in equity method investment | ' | ' | 60.00% | 57.14% | ' | ' | ' | ' | ' |
Investments in unconsolidated entities | $265,585,000 | $144,531,000 | ' | ' | ' | $114,800,000 | ' | ' | ' |
Deconsolidation description | ' | ' | ' | ' | 'On April 3, 2013, U.S. Cellular entered into an agreement relating to the Partnerships. The agreement amends the Partnership Agreements in several ways which provide Verizon Wireless with substantive participating rights that allow Verizon Wireless to make decisions that are in the ordinary course of business of the Partnerships and which are significant to directing and executing the activities of the business. Accordingly, as required by GAAP, U.S. Cellular deconsolidated the Partnerships effective as of April 3, 2013 and thereafter reported them as equity method investments in its consolidated financial statements (“NY1 & NY2 Deconsolidation”). After the NY1 & NY2 Deconsolidation, U.S. Cellular retained the same ownership percentages in the Partnerships and will continue to report the same percentages of income from the Partnerships, which will be recorded in Equity in earnings of unconsolidated entities in the Consolidated Statement of Operations. In addition to the foregoing described arrangements, U.S. Cellular has certain other arm’s length, ordinary business relationships with Verizon Wireless and its affiliates. | ' | ' | ' | ' |
Deconsolidation gain | ' | ' | ' | ' | $18,500,000 | ' | ' | ' | ' |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Land | $36,266,000 | $33,947,000 | ' |
Buildings | 304,272,000 | 341,852,000 | ' |
Leasehold and land improvements | 1,197,520,000 | 1,188,720,000 | ' |
Cell site equipment | 3,306,575,000 | 3,100,916,000 | ' |
Switching equipment | 1,161,976,000 | 1,155,114,000 | ' |
Office furniture and equipment | 539,248,000 | 535,656,000 | ' |
Other operating assets and equipment | 92,456,000 | 128,290,000 | ' |
System development | 962,698,000 | 631,184,000 | ' |
Work in process | 116,501,000 | 362,749,000 | ' |
Property, plant and equpment, gross | 7,717,512,000 | 7,478,428,000 | ' |
Less: Accumulated depreciation | -4,860,992,000 | -4,455,840,000 | ' |
Property, plant and equipment, net | 2,856,520,000 | 3,022,588,000 | ' |
Depreciation and amortization expense | 791,100,000 | 597,700,000 | 565,100,000 |
(Gain) loss on asset disposals, net | $30,606,000 | $18,088,000 | $9,889,000 |
Buildings | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '20 years | ' | ' |
Leasehold Improvements [Member] | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '1 year | ' | ' |
Leasehold Improvements [Member] | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '30 years | ' | ' |
Cell site equipment | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '6 years | ' | ' |
Cell site equipment | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '25 years | ' | ' |
Switching equipment | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '1 year | ' | ' |
Switching equipment | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '8 years | ' | ' |
Office furniture and equipment | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '3 years | ' | ' |
Office furniture and equipment | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '5 years | ' | ' |
Other operating equipment | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '5 years | ' | ' |
Other operating equipment | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '25 years | ' | ' |
System development | Minimum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '3 years | ' | ' |
System development | Maximum | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Useful life | '7 years | ' | ' |
Asset_Retirement_Obligaion_Det
Asset Retirement Obligaion (Details) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
Asset retirement obligation | ' | ' | ||
Asset retirement obligation - beginning balance | $179,607 | [1] | $143,402 | |
Additional liabilities accrued | 635 | 5,578 | ||
Revisions in estimated cash outflows | 6,268 | [2] | 22,588 | [2] |
Disposition of assets | -3,534 | [3] | -2,674 | [3] |
Accretion expense | 12,592 | [4] | 10,713 | [4] |
Asset retirement obligation - ending balance | 195,568 | [1] | 179,607 | [1] |
Divestiture transaction | ' | ' | ||
Asset retirement obligation | ' | ' | ||
Revisions in estimated cash outflows | ' | 14,900 | ||
Disposition of assets | -2,000 | ' | ||
Accretion expense | 1,100 | 200 | ||
Divestiture transaction | Other current liabilities | ' | ' | ||
Asset retirement obligation | ' | ' | ||
Asset retirement obligation - ending balance | $37,700 | ' | ||
[1] | In 2013, as a result of the accelerated settlement dates of certain asset retirement obligations related to the Divestiture Transaction, U.S. Cellular reclassified $37.7 million of its asset retirement obligations from Other deferred liabilities and credits to Other current liabilities. | |||
[2] | Included increases of $14.9 million as a result of changes in expected settlement dates related to the Divestiture Transaction in 2012. | |||
[3] | Included $2.0 million of incremental disposition costs related to the Divestiture Transaction in 2013. | |||
[4] | Included $1.1 million and $0.2 million of incremental accretion related to the Divestiture Transaction in 2013 and 2012, respectively. |
Debt_Revolving_Credit_Faciliti
Debt, Revolving Credit Facilities (Details) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Revolving credit | ' | ' | ' | |
Subordination agreement description | 'In connection with U.S. Cellular’s revolving credit facility, TDS and U.S. Cellular entered into a subordination agreement dated December 17, 2010 together with the administrative agent for the lenders under U.S. Cellular’s revolving credit agreement. Pursuant to this subordination agreement, (a) any consolidated funded indebtedness from U.S. Cellular to TDS will be unsecured and (b) any (i) consolidated funded indebtedness from U.S. Cellular to TDS (other than “refinancing indebtedness” as defined in the subordination agreement) in excess of $105,000,000, and (ii) refinancing indebtedness in excess of $250,000,000, will be subordinated and made junior in right of payment to the prior payment in full of obligations to the lenders under U.S. Cellular’s revolving credit agreement. As of December 31, 2013, U.S. Cellular had no outstanding consolidated funded indebtedness or refinancing indebtedness that was subordinated to the revolving credit agreement pursuant to the subordination agreement. | ' | ' | |
U.S. Cellular revolving credit facility | ' | ' | ' | |
Revolving credit | ' | ' | ' | |
Maximum borrowing capacity | $300 | ' | ' | |
Letters of credit outstanding | 17.6 | [1] | ' | ' |
Amount available for use | 282.4 | ' | ' | |
LIBOR | 0.17% | [2] | ' | ' |
Contractual spread | 1.50% | [2] | ' | ' |
Borrowing rate: One-month London InterBank Offered Rate ("LIBOR") plus contractual spread | 1.67% | [2] | ' | ' |
Fees incurred as a percent of Maximum borrowing capacity for 2013 | 0.25% | ' | ' | |
Fees incurred, amount | 0.8 | 1.1 | 1.2 | |
Agreement date | 17-Dec-10 | ' | ' | |
Maturity date | 17-Dec-17 | ' | ' | |
Borrowing rate description | 'Borrowings under the revolving credit facility bear interest at LIBOR plus a contractual spread based on U.S. Cellular’s credit rating or, at U.S. Cellular’s option, an alternate “Base Rate” as defined in the revolving credit agreement. U.S. Cellular may select a borrowing period of either one, two, three or six months (or other period of twelve months or less if requested by U.S. Cellular and approved by the lenders). If U.S. Cellular provides notice of intent to borrow less than three business days in advance of a borrowing, interest on borrowing is at the Base Rate plus the contractual spread. | ' | ' | |
Debt issuance costs, net of accumulated amortization | 2.7 | ' | ' | |
U.S. Cellular revolving credit facility | Letters of credit to the FCC | ' | ' | ' | |
Revolving credit | ' | ' | ' | |
Letters of credit outstanding | $17.40 | ' | ' | |
U.S. Cellular revolving credit facility | Minimum | ' | ' | ' | |
Revolving credit | ' | ' | ' | |
Range of commitment fees on amount available for use | 0.13% | [3] | ' | ' |
U.S. Cellular revolving credit facility | Maximum | ' | ' | ' | |
Revolving credit | ' | ' | ' | |
Range of commitment fees on amount available for use | 0.30% | [3] | ' | ' |
[1] | In June 2013, U.S. Cellular provided $17.4 million in letters of credit to the FCC in connection with U.S. Cellular's winning bids in Auction 901. See Note 16 b Supplemental Cash Flow Disclosures for additional information on Auction 901. | |||
[2] | Borrowings under the revolving credit facility bear interest at LIBOR plus a contractual spread based on U.S. Cellularbs credit rating or, at U.S. Cellularbs option, an alternate bBase Rateb as defined in the revolving credit agreement. U.S. Cellular may select a borrowing period of either one, two, three or six months (or other period of twelve months or less if requested by U.S. Cellular and approved by the lenders). If U.S. Cellular provides notice of intent to borrow less than three business days in advance of a borrowing, interest on borrowing is at the Base Rate plus the contractual spread. | |||
[3] | The revolving credit facility has commitment fees based on the unsecured senior debt ratings assigned to U.S. Cellular by certain ratings agencies. |
Debt_Fixed_Rate_Debt_Details
Debt, Fixed Rate Debt (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Long term debt | ' | ' |
Debt issuance cost | $16,300,000 | ' |
Obligation on capital leases | 3,749,000 | 4,756,000 |
Total long-term debt | 878,198,000 | 878,950,000 |
Long-term debt, current | 166,000 | 92,000 |
Long-term debt, noncurrent | 878,032,000 | 878,858,000 |
6.95% Senior Notes | ' | ' |
Long term debt | ' | ' |
Interest rate on debt | 6.95% | ' |
Date of debt issuance | 9-May-11 | ' |
Maturity date of debt issued | 15-May-60 | ' |
Call date of debt issued | 15-May-16 | ' |
Long term debt | 342,000,000 | 342,000,000 |
6.7% Senior Notes | ' | ' |
Long term debt | ' | ' |
Interest rate on debt | 6.70% | ' |
Maturity date of debt issued | 15-Dec-33 | ' |
Call date of debt issued | 31-Dec-03 | ' |
Long term debt, face value | 544,000,000 | 544,000,000 |
Unamortized discount | -11,551,000 | -11,806,000 |
Long term debt | $532,449,000 | $532,194,000 |
6.7% Senior Notes | Minimum | ' | ' |
Long term debt | ' | ' |
Date of debt issuance | 15-Dec-03 | ' |
6.7% Senior Notes | Maximum | ' | ' |
Long term debt | ' | ' |
Date of debt issuance | 15-Jun-04 | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies minimum lease obligations (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Commitments and Contingencies Disclosure [Abstract] | ' |
Operating leases | 'U.S. Cellular is a party to various lease agreements, both as lessee and lessor, for office space, retail store sites, cell sites and equipment which are accounted for as operating leases. Certain leases have renewal options and/or fixed rental increases. Renewal options that are reasonably assured of exercise are included in determining the lease term. Any rent abatements or lease incentives, in addition to fixed rental increases, are included in the calculation of rent expense and calculated on a straight-line basis over the defined lease term. |
Operating Leases Future Minimum Payments Due Abstract | ' |
Operating Leases - Future Minimum Rental Payments 2014 | $152,349 |
Operating Leases - Future Minimum Rental Payments 2015 | 134,852 |
Operating Leases - Future Minimum Rental Payments 2016 | 116,397 |
Operating Leases - Future Minimum Rental Payments 2017 | 97,098 |
Operating Leases - Future Minimum Rental Payments 2018 | 79,166 |
Operating Leases - Future Minimum Rental Payments After 2018 | 783,730 |
Operating Leases - Future Minimum Rental Payments Total | 1,363,592 |
Operating Leases Future Minimum Payments Receivable Abstract | ' |
Operating Leases - Future Minimum Rental Receipts 2014 | 46,357 |
Operating Leases - Future Minimum Rental Receipts 2015 | 36,847 |
Operating Leases - Future Minimum Rental Receipts 2016 | 26,201 |
Operating Leases - Future Minimum Rental Receipts 2017 | 17,226 |
Operating Leases - Future Minimum Rental Receipts 2018 | 6,521 |
Operating Leases - Future Minimum Rental Receipts After 2018 | 227 |
Operating Leases - Future Minimum Rental Receipts Total | $133,379 |
Commitments_and_Contingencies_2
Commitments and Contingencies, additional lease informaton (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expense | $162.10 | $183.90 | $171.60 |
Rent revenue | $45.70 | $41.70 | $39.20 |
Commitments_and_Contingencies_3
Commitments and Contingencies, purchase commitments (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
BOSS Implementation | ' |
Long Term Purchase Commitment [Line Items] | ' |
Purchase commitment agreement description | 'As previously disclosed, on August 17, 2010, U.S. Cellular and Amdocs Software Systems Limited (“Amdocs”) entered into a Software License and Maintenance Agreement (“SLMA”) and a Master Service Agreement (“MSA”) (collectively, the “Amdocs Agreements”) to develop a Billing and Operational Support System (“B/OSS”). In July 2013, U.S. Cellular implemented B/OSS, pursuant to an updated Statement of Work dated June 29, 2012. Total payments to Amdocs related to this implementation are estimated to be approximately $183.9 million (subject to certain potential adjustments) over the period from commencement of the SLMA through the first half of 2014. As of December 31, 2013, $136.8 million had been paid to Amdocs. |
Purchase commitment period | 'August 17, 2010 through the first half of 2014 |
Purchase commitment payments made | $136.80 |
Purchase commitment estimated payments | 183.9 |
Apple Products | ' |
Long Term Purchase Commitment [Line Items] | ' |
Purchase commitment agreement description | 'In March 2013, U.S. Cellular entered into an agreement with Apple to purchase certain minimum quantities of Apple iPhone products over a three-year period beginning in November 2013. Based on current forecasts, U.S. Cellular estimates that the remaining contractual purchase commitment as of December 31, 2013 is approximately $950 million. At this time, U.S. Cellular expects to meet its contractual commitment with Apple. |
Purchase commitment period | 'three-year period beginning in November 2013 |
Purchase commitment remaining estimated payments | $950 |
Commitments_and_Contingencies_4
Commitments and Contingencies, legal accruals and unasserted claims (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Loss Contingency Estimate | ' | ' |
Accrual for legal proceedings and unasserted claims | $0.30 | $1.70 |
Variable_Interest_Entities_VIE1
Variable Interest Entities VIEs (Details) (USD $) | 12 Months Ended | 12 Months Ended | ||||
Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | |
Variable Interest Entities (VIE's) | Variable Interest Entities (VIE's) | |||||
Assets | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $378,358,000 | $342,065,000 | $424,155,000 | $276,915,000 | $2,076,000 | $5,849,000 |
Other current assets | 16,745,000 | 19,538,000 | ' | ' | 1,184,000 | 120,000 |
Licenses | 1,456,794,000 | 1,401,126,000 | ' | ' | 310,475,000 | 308,091,000 |
Property, plant and equipment, net | 3,022,588,000 | 2,856,520,000 | ' | ' | 18,600,000 | 16,443,000 |
Other assets and deferred charges | 78,250,000 | 117,735,000 | ' | ' | 511,000 | 887,000 |
Total assets | ' | ' | ' | ' | 332,846,000 | 331,390,000 |
Liabilities | ' | ' | ' | ' | ' | ' |
Current liabilities | 754,999,000 | 1,006,173,000 | ' | ' | 46,000 | 1,013,000 |
Deferred liabilities and credits | ' | ' | ' | ' | 3,139,000 | 3,024,000 |
Total liabilities | ' | ' | ' | ' | 3,185,000 | 4,037,000 |
Capital contributions and advances | 10,000,000 | ' | ' | ' | ' | ' |
VIE put options | ' | ' | ' | ' | 'true | ' |
Put option exercisable dates | ' | ' | ' | ' | 'The limited partnership agreements of Aquinas Wireless and King Street Wireless also provide the general partner with a put option whereby the general partner may require the limited partner, a subsidiary of U.S. Cellular, to purchase its interest in the limited partnership. The general partner’s put options related to its interests in King Street Wireless and Aquinas Wireless will become exercisable in 2019 and 2020, respectively. | ' |
Noncontrolling interests with redemption features | $493,000 | $536,000 | ' | ' | ' | ' |
Noncontrolling_Interests_Detai
Noncontrolling Interests (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Redeemable noncontrolling interest | ' |
Termination date range of mandatorily redeemable noncontrolling interests - begin | '2085 |
Termination date range of mandatorily redeemable noncontrolling interests - end | '2107 |
Settlement value of mandatorily redeemable noncontrolling interests | $24.80 |
Carrying value of mandatorily redeemable noncontrolling interests | $15.40 |
Common_Shareholders_Equity_Det
Common Shareholders' Equity (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Common shareholders' equity, other disclosures | ' | ' | ' |
Dividend payable date | 25-Jun-13 | ' | ' |
Dividend date of record | 11-Jun-13 | ' | ' |
Series A Common and Common Shares, dividends per share paid | $5.75 | ' | ' |
Series A Common and Common Shares, dividends paid | $482,270 | ' | ' |
Share repurchases | ' | ' | ' |
Amount | 18,544 | 20,045 | 62,294 |
Common share repurchase authorization | 'On November 17, 2009, the Board of Directors of U.S. Cellular authorized the repurchase of up to 1,300,000 Common Shares on an annual basis beginning in 2009 and continuing each year thereafter, on a cumulative basis. These purchases will be made pursuant to open market purchases, block purchases, private purchases, or otherwise, depending on market prices and other conditions. This authorization does not have an expiration date. | ' | ' |
Repurchase expiration | 'This authorization does not have an expiration date. | ' | ' |
Treasury Shares | ' | ' | ' |
Share repurchases | ' | ' | ' |
Amount | 18,544 | 20,045 | 62,294 |
Common Shares | ' | ' | ' |
Common shareholders' equity, other disclosures | ' | ' | ' |
Voting rights, board of directors | '25% | ' | ' |
Share repurchases | ' | ' | ' |
Number of shares acquired | 499,000 | 571,000 | 1,276,000 |
Average cost per share | $37.19 | $35.11 | $48.82 |
Amount | $18,544 | $20,045 | $62,294 |
Common share repurchase authorization | 'On November 17, 2009, the Board of Directors of U.S. Cellular authorized the repurchase of up to 1,300,000 Common Shares on an annual basis beginning in 2009 and continuing each year thereafter, on a cumulative basis. These purchases will be made pursuant to open market purchases, block purchases, private purchases, or otherwise, depending on market prices and other conditions. | ' | ' |
Repurchase authorization, additional number of shares | 1,300,000 | ' | ' |
Common Shares | 401(k) | ' | ' | ' |
Common shareholders' equity, other disclosures | ' | ' | ' |
Shares reserved | 67,215 | ' | ' |
Common Shares | Treasury Shares | ' | ' | ' |
Common shareholders' equity, other disclosures | ' | ' | ' |
Shares reissued | 535,578 | 182,195 | 286,211 |
Series A Common Shares | ' | ' | ' |
Common shareholders' equity, other disclosures | ' | ' | ' |
Voting rights, board of directors | '75% | ' | ' |
StockBased_Compensation_Overvi
Stock-Based Compensation Overview, Expense and Valuation Model (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | $15,844,000 | $21,466,000 | $20,183,000 |
Income tax benefit | -5,984,000 | -8,121,000 | -7,581,000 |
Total stock-based compensation expense, net of income taxes | 9,860,000 | 13,345,000 | 12,602,000 |
Unrecognized compensation cost for all stock-based compensation awards | 24,500,000 | ' | ' |
Weighted average period for recognition of unrecognized compensation cost for all stock-based compensation awards | '2 years 4 months | ' | ' |
Tax benefit from exercise of stock options and other awards | 6,100,000 | ' | ' |
System operations | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | 2,911,000 | 3,029,000 | 2,645,000 |
Selling, general and administrative expense | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | 12,933,000 | 18,437,000 | 17,538,000 |
2005 and 2013 Long-Term Incentive Plans | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Terms of Award | 'Under the U.S. Cellular Long-Term Incentive Plans, U.S. Cellular may grant fixed and performance based incentive and non-qualified stock options, restricted stock, restricted stock units, and deferred compensation stock unit awards to key employees. At December 31, 2013, the only types of awards outstanding are fixed non-qualified stock option awards, restricted stock unit awards, and deferred compensation stock unit awards. | ' | ' |
2005 and 2013 Long-Term Incentive Plans | Stock Options | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | 5,810,000 | 8,471,000 | 9,549,000 |
2005 and 2013 Long-Term Incentive Plans | Stock Options | Minimum | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Stock options expiration date | 29-Mar-14 | ' | ' |
2005 and 2013 Long-Term Incentive Plans | Stock Options | Maximum | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Stock options expiration date | 18-Dec-23 | ' | ' |
2005 and 2013 Long-Term Incentive Plans | Restricted Stock Units | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | 9,485,000 | 12,300,000 | 10,037,000 |
2005 and 2013 Long-Term Incentive Plans | Deferred Compensation Stock Units | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | 2,000 | 240,000 | 12,000 |
2009 Employee Stock Purchase Plan | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Terms of Award | 'The U.S. Cellular 2009 Employee Stock Purchase Plan was terminated in the fourth quarter of 2011. | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | ' | ' | 255,000 |
Non-Employee Directors' Plan | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Stock-based compensation expense | $547,000 | $455,000 | $330,000 |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Stock Options | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Terms of Award | 'Stock options granted to key employees are exercisable over a specified period not in excess of ten years. Stock options generally vest over a period of three years from the date of grant. Stock options outstanding at December 31, 2013 expire between 2014 and 2023. However, vested stock options typically expire 30 days after the effective date of an employee’s termination of employment for reasons other than retirement. Employees who leave at the age of retirement have 90 days (or one year if they satisfy certain requirements) within which to exercise their vested stock options. The exercise price of options equals the market value of U.S. Cellular Common Shares on the date of grant. | ' | ' |
Black Scholes valuation model assumptions | ' | ' | ' |
Expected life | ' | '4 years 6 months | '4 years 4 months |
Expected annual volatility rate, minimum | 29.20% | 40.70% | 43.40% |
Expected annual volatility rate, maximum | 39.60% | 42.60% | 44.80% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate, minimum | 0.70% | 0.50% | 0.70% |
Risk-free interest rate, maximum | 2.40% | 0.90% | 2.00% |
Estimated annual forfeiture rate, minimum | 0.00% | 0.00% | 0.00% |
Estimated annual forfeiture rate, maximum | 8.10% | 9.10% | 7.80% |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Stock Options | Minimum | ' | ' | ' |
Black Scholes valuation model assumptions | ' | ' | ' |
Expected life | '4 years 5 months | ' | ' |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Stock Options | Maximum | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Shares reserved | 10,139,000 | ' | ' |
Black Scholes valuation model assumptions | ' | ' | ' |
Expected life | '9 years 0 months | ' | ' |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Restricted Stock Units | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Terms of Award | 'U.S. Cellular grants restricted stock unit awards, which generally vest after three years, to key employees. U.S. Cellular estimates the fair value of restricted stock units based on the closing market price of U.S. Cellular shares on the date of grant. The fair value is then recognized as compensation cost on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. | ' | ' |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Deferred Compensation Stock Units | ' | ' | ' |
Stock-based compensation, overview | ' | ' | ' |
Terms of Award | 'Certain U.S. Cellular employees may elect to defer receipt of all or a portion of their annual bonuses and to receive a company matching contribution on the amount deferred. All bonus compensation that is deferred by employees electing to participate is immediately vested and is deemed to be invested in U.S. Cellular Common Share stock units. The amount of U.S. Cellular’s matching contribution depends on the portion of the annual bonus that is deferred. Participants receive a 25% match for amounts deferred up to 50% of their total annual bonus and a 33% match for amounts that exceed 50% of their total annual bonus; such matching contributions also are deemed to be invested in U.S. Cellular Common Share stock units. | ' | ' |
Common Shares | Non-Employee Directors' Plan | ' | ' | ' |
Stock based compensation | ' | ' | ' |
Shares reserved | 212,000 | ' | ' |
StockBased_Compensation_Option
Stock-Based Compensation Option Rollforward (Details) (Common Shares, 2005 and 2013 Long-Term Incentive Plans, Stock Options, USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Common Shares | 2005 and 2013 Long-Term Incentive Plans | Stock Options | ' | ' | ' |
Stock compensation, stock option rollforward schedule, number of options | ' | ' | ' |
Outstanding, begin of period | 3,214,000 | 2,834,000 | 2,627,000 |
Exercisable options, begin of period | 1,928,000 | 1,533,000 | 1,333,000 |
Granted options | 1,213,000 | 677,000 | 694,000 |
Exercised options | -892,000 | -47,000 | -201,000 |
Forfeited options | -574,000 | -117,000 | -83,000 |
Expired options | -247,000 | -133,000 | -203,000 |
Outstanding, end of period | 2,714,000 | 3,214,000 | 2,834,000 |
Exercisable options, end of period | 1,359,000 | 1,928,000 | 1,533,000 |
Stock compensation, stock option rollforward schedule, other information | ' | ' | ' |
Options outstanding, begin of period - weighted average exercise price | $41.58 | $43.07 | $42.28 |
Options exercisable, begin of period - weighted average exercise price | $43.99 | $46.23 | $47.18 |
Options granted, weighted average exercise price | $32.45 | $34.91 | $44.34 |
Options exercised, weighted average exercise price | $34.78 | $29.82 | $32.32 |
Options forfeited, weighted average exercise price | $34.17 | $38.45 | $39.42 |
Options expired, weighted average exercise price | $48.35 | $46.17 | $49.32 |
Options outstanding, end of period - weighted average exercise price | $42.22 | $41.58 | $43.07 |
Options exercisable, end of period - weighted average exercise price | $46.91 | $43.99 | $46.23 |
Options granted, weighted average grant date fair value | $11.53 | $12.61 | $16.66 |
Aggregate intrinsic value, options exercised | $6,787,000 | $205,000 | $2,099,000 |
Aggregate intrinsic value, options outstanding | 13,015,000 | ' | ' |
Aggregate intrinsic value, options exercisable | $2,632,000 | ' | ' |
Weighted average remaining contractual life, outstanding | '6 years 7 months | ' | ' |
Weighted average remaining contractual life, exercisable | '4 years 5 months | ' | ' |
StockBased_Compensation_Nonves
Stock-Based Compensation Nonvested Shares and Other (Details) (Common Shares, USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
2005 and 2013 Long-Term Incentive Plans | Restricted Stock Units | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward] | ' | ' | ' |
Nonvested stock units, begin of period - Number of shares | 1,139,000 | ' | ' |
Granted number of shares | 601,000 | ' | ' |
Vested number of shares | -238,000 | ' | ' |
Forfeited number of shares | -332,000 | ' | ' |
Nonvested stock units, end of period - Number of shares | 1,170,000 | 1,139,000 | ' |
Stock based compensation, Nonvested shares weighted average grant date fair value | ' | ' | ' |
Nonvested stock units - begin of period weighted average grant date fair value | $38.40 | ' | ' |
Granted weighted average grant date fair value | $32.06 | $34.09 | $42.33 |
Vested weighted average grant date fair value | $42.26 | ' | ' |
Forfeited weighted average grant date fair value | $35.63 | ' | ' |
Nonvested stock units - end of period weighted average grant date fair value | $36.46 | $38.40 | ' |
Fair value of vested stock units | $8.80 | $8.90 | $9.50 |
2005 and 2013 Long-Term Incentive Plans | Deferred Compensation Stock Units | ' | ' | ' |
Stock based compensation, Nonvested shares weighted average grant date fair value | ' | ' | ' |
Granted weighted average grant date fair value | $31.50 | $36.34 | $41.79 |
Fair value of vested stock units | 0.1 | 0.1 | 0.1 |
Shares issued and granted under stock compensation plans | ' | ' | ' |
Vested number of shares, unissued | 12,000 | ' | ' |
Vested number of shares, unissued, fair value | $0.50 | ' | ' |
Non-Employee Directors' Plan | ' | ' | ' |
Shares issued and granted under stock compensation plans | ' | ' | ' |
Shares issued | 13,000 | 7,600 | 6,600 |
Supplemental_Cash_Flow_Disclos2
Supplemental Cash Flow Disclosures (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Supplemental cash flow disclosures | ' | ' | ' |
Interest paid | $42,904,000 | $44,048,000 | $55,580,000 |
Income taxes paid (refunded) | 157,778,000 | -58,609,000 | -54,469,000 |
Dividend payable date | 25-Jun-13 | ' | ' |
Dividend date of record | 11-Jun-13 | ' | ' |
Series A Common and Common Shares, dividends per share paid | $5.75 | ' | ' |
Series A Common and Common Shares, dividends paid | 482,270,000 | ' | ' |
Supplemental cash flows, stock based compensation | ' | ' | ' |
Net cash receipts (disbursements) from exercise of stock options and vesting of other stock awards | 5,784,000 | -2,205,000 | 1,935,000 |
Auction 901 Mobility Funds | ' | ' | ' |
Supplemental cash flow disclosures | ' | ' | ' |
FCC auction date | 27-Sep-12 | ' | ' |
FCC auction amount received | 13,400,000 | ' | ' |
FCC auction number of states won | 10 | ' | ' |
Other assets and deferred charges | Auction 901 Mobility Funds | ' | ' | ' |
Supplemental cash flow disclosures | ' | ' | ' |
FCC auction amount received | 10,300,000 | ' | ' |
Property, plant and equipment, net | Auction 901 Mobility Funds | ' | ' | ' |
Supplemental cash flow disclosures | ' | ' | ' |
FCC auction amount received | 3,100,000 | ' | ' |
Maximum | Auction 901 Mobility Funds | ' | ' | ' |
Supplemental cash flow disclosures | ' | ' | ' |
FCC auction amount | 300,000,000 | ' | ' |
FCC auction amount awarded | 40,100,000 | ' | ' |
Common Shares | ' | ' | ' |
Supplemental cash flows, stock based compensation | ' | ' | ' |
Shares withheld | 606,582 | 92,846 | 120,250 |
Aggregate value of shares withheld | 25,179,000 | 3,604,000 | 5,952,000 |
Cash receipts upon exercise of stock options | 10,468,000 | 900,000 | 5,447,000 |
Cash disbursements for payments of taxes | -4,684,000 | -3,105,000 | -3,512,000 |
Net cash receipts (disbursements) from exercise of stock options and vesting of other stock awards | $5,784,000 | ($2,205,000) | $1,935,000 |
Related_Parties_Details
Related Parties (Details) (TDS, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
TDS | ' | ' | ' |
Related Party Transactions | ' | ' | ' |
Description of related transaction | 'U.S. Cellular is billed for all services it receives from TDS, pursuant to the terms of various agreements between it and TDS. These billings are included in U.S. Cellular's Selling, general and administrative expenses. Some of these agreements were established at a time prior to U.S. Cellular's initial public offering when TDS owned more than 90% of U.S. Cellular's outstanding capital stock and may not reflect terms that would be obtainable from an unrelated third party through arms-length negotiations. Billings from TDS to U.S. Cellular are based on expenses specifically identified to U.S. Cellular and on allocations of common expenses. Such allocations are based on the relationship of U.S. Cellular's assets, employees, investment in property, plant and equipment and expenses relative to all subsidiaries in the TDS consolidated group. Management believes the method TDS uses to allocate common expenses is reasonable and that all expenses and costs applicable to U.S. Cellular are reflected in its financial statements. | ' | ' |
Billings to U.S. Cellular from TDS | $99.20 | $104.30 | $104.10 |
Certain_Relationships_and_Rela1
Certain Relationships and Related Transactions (Details) (Sidley Austin LLP, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Sidley Austin LLP | ' | ' | ' |
Certain relationships and related transactions | ' | ' | ' |
Legal expense | $13.20 | $10.70 | $9.20 |
Description of related transaction | 'The following persons are partners of Sidley Austin LLP, the principal law firm of U.S. Cellular and its subsidiaries: Walter C.D. Carlson, a director of U.S. Cellular, a director and non-executive Chairman of the Board of Directors of TDS and a trustee and beneficiary of a voting trust that controls TDS; William S. DeCarlo, the General Counsel of TDS and an Assistant Secretary of TDS and certain subsidiaries of TDS; and Stephen P. Fitzell, the General Counsel of U.S. Cellular and TDS Telecommunications Corporation and an Assistant Secretary of U.S. Cellular and certain other subsidiaries of TDS. Walter C.D. Carlson does not provide legal services to TDS, U.S. Cellular or their subsidiaries. | ' | ' |