U.S. Cellular said its initial 5G markets in parts of Iowa and Wisconsin will be commercially available on March 6. The Chicago-based company, which has roughly 5 million customers, previously said it would begin deploying 5G in the second half of 2019 but later pushed those plans back to the first quarter of 2020.

The operator also inked a deal with Samsung that calls for the vendor to become the third company to provide equipment for the operator’s 5G network. The regional wireless carrier previously announced agreements with Nokia and Ericsson for 5G equipment and software.

During U.S. Cellular’s earnings call today, CEO Kenneth Meyers said the operator is in the beginning stages of its multi-year rollout of 5G. “Our initial 5G rollout in 2020 will use 600 MHz [spectrum]. We’re planning to augment it with millimeter-wave (mmWave) spectrum to increase speeds and important future use cases” near the end of 2020, he said.

“We began to deploy 5G technology in Iowa and Wisconsin, our first 5G markets, with commercial launches planned in the next couple of months,” Meyers said. The operator also added its initial 5G footprint to its coverage map, showing coverage in hundreds of communities.

U.S. Cellular Capex Rises (Again)

U.S. Cellular is increasing capex spending in 2020 to a range of $850 million to $950 million, representing a year-over-year jump of 19.7% to 33.8%. U.S. Cellular’s capex also grew substantially in 2019, jumping at least 35% from the year-ago period to $710 million.

“There’s a lot going on in the network space in 2020,” CFO Douglas Chambers said during the earnings call. He also shared some concerns about delayed availability of 5G equipment and services, despite its deals with multiple vendors that are already shipping 5G equipment around the world.

“Admittedly, this is a large [capex] increase and we could be affected by potential constraints on the availability of network equipment and services. As a result, we may not be able to complete all of our plans this year,” Chambers said.

It’s unclear if Ericsson, Nokia, or Samsung will capture the majority of U.S. Cellular’s spend on 5G, but the new agreement with Samsung is similar to the other vendors in providing radios, software, and services that will be required to build a 5G network across the carrier’s footprint. Samsung did, however, note that it will provide its 28 GHz 5G new radio units to U.S. Cellular, which could indicate that Samsung will play more heavily into the operator's mmWave plans.

U.S. Cellular also provided some details about how its 2020 capex will be allocated, with 5G on 600 MHz comprising about a third of all spending and about 10% earmarked for 5G on mmWave. Overall, the operator plans to spend about 45% of its 2020 capex on 5G, according to a pie chart it provided in its guidance.

“We’re still finishing up voice-over-LTE (VoLTE) while we’re starting down the road to 5G,” Meyers said. He framed the 5G investment as a two-part opportunity: a network that operates more efficiently at a lower cost, and an opportunity to provide fixed wireless broadband in areas where the economics for cable and fiber don’t add up.

“What we’re starting to see even in mid-sized towns is a desire to understand how 5G can help these government entities deliver their services to their customers, their tax base, more efficiently,” he said. “A lot to develop there, I understand that, it’s a long lead time but you’ve got to have the infrastructure in place especially in the core network… The first starting point is in the core, which is what we’re spending on right now.”