Ladies and gentlemen, thank you for standing by, and welcome to TDS and U.S. Cellular Fourth Quarter 2019 Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jane McCahon. Please go ahead. Jane W. McCahon: Thank you, Michelle, and good morning, everyone, and thank you for joining us. I want to make you all aware of the presentation we have prepared to accompany our comments this morning, which you will find on the Investor Relations sections of the TDS and U.S. Cellular websites. With me today and offering prepared comments are from U.S. Cellular, Ken Meyers, President and Chief Executive Officer; Doug Chambers, Senior Vice President and Chief Financial Officer; and from TDS Telecom, Jim Butman, President and Chief Executive Officer; and Vicki Villacrez, Senior Vice President and Chief Financial Officer. This call is being simultaneously webcast on the TDS and U.S. Cellular Investor Relations websites. Please see the websites for slides referred to on this call, including non-GAAP reconciliations. We provide guidance for both adjusted operating income before depreciation and amortization, or OIBDA, and adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, to highlight the contributions of U.S. Cellular's wireless partnerships. As shown on Slide 2, the information set forth in the presentation and discussed during this call contains statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. Please review the safe harbor paragraph in our press releases and the extended versions in our SEC filings. TDS and U.S. Cellular filed their SEC Forms 8-K yesterday, including today's press releases, and please note that we will be filing our SEC Forms 10-K on Tuesday, February 25. In terms of our upcoming IR schedule on Slide 3, we'll be attending the Raymond James Institutional Investors Conference on March 2 in Orlando and the Morgan Stanley Technology, Media and Telecom Conference on March 5 in San Francisco. I will be doing a non-deal roadshow with Strategas Securities in Portland on March 6. And as you know, we have an open-door policy, so if you're coming to Chicago and would like to meet with members of management or the IR team, please let us know, and we will try to accommodate you, calendars permitting. Also, I did want to highlight that we have yet again announced an increase in our dividend rate for 2020, this being the 46th consecutive year that we've raised our dividend. And before turning the call over, I want to remind everyone that even though auction -- FCC Auction 103 has ended, we are still in the assignment phase, and we are unable to respond to any questions related to any FCC auctions. And now I will turn the call over to Ken Meyers. Ken?

Good morning. I'll start on Slide 5. And before talking about 2019 and 2020, I first want to take a step back and look at some of our multiyear investments that have positioned us to better serve our customers into the future. Let's start with spectrum. While I cannot comment on Auction 103, I do want to point to the success we've had in Auctions 101 and 102, where we secured important spectrum for our 5G plans. In terms of the customer experience, the introduction of unlimited plans has been a game changer for this entire industry. And as much as I still worry about the long-term economics of unlimited plans, customers do love them. They have improved overall satisfaction levels. And the migration to these higher-priced plans has helped drive increases in average revenue per user. To support the increased data usage, we have continued to invest in our network capacity. Other investments we've made include a brand refresh centered on bringing fairness to wireless and designed to broaden our appeal in the marketplace. We have also enhanced our website so that customers have a better and faster online experience, giving us a platform for future growth in this channel. Also, there are very positive developments in our roaming economics. Voice over LTE technology has broken down the old CDMA, GSM-only roaming patterns. And today, we have roaming agreements with all the big 4 carriers. As a result, we have seen roaming traffic and roaming revenues growing and roaming expenses declining. It's a very nice combination. We've also invested in our culture. We know it's our frontline associates that deliver the outstanding customer experience U.S. Cellular is known for in the marketplace. We have numerous programs to ensure our exceptionally high levels of engagement remain and our culture continues to thrive. Our associates are our secret sauce, and I greatly appreciate all of their effort. As mentioned earlier, we continue to invest in the network to meet capacity and the ongoing growth in demand and to improve speeds, too. We are completing the final stages for our Voice over LTE rollout and beginning our multiyear rollout of 5G. Our initial 5G rollout in 2020 will use 600 megahertz spectrum. We are planning to augment it with millimeter wave spectrum to increase speeds and support future use cases. These charts on this page show how, while meeting our customers' ever-increasing demands for data, we have, at the same time, managed the business to drive annual increases in adjusted earnings before taxes and depreciation and amortization, while continuing to make investments for the long term, including Voice over LTE, network modernization, spectrum and 5G. Turning to 2019, Slide 6, we worked hard in 2019 to protect our customer base and smartphone connections grew by 71,000 during the year. For the full year, handset churn increased slightly from the previous year, but still low, indicating strong levels of customer satisfaction, especially in this ultra-competitive market. Another priority was growing revenues. We reported a 2% increase in service revenues for the year, driven by a 2% increase in postpaid average revenue per customer and a 6% increase in prepaid average revenue per customer. Factors that drove this growth include a shift in mix from connected devices to smartphones, customers migrating to higher-priced service plans and increases in the penetration of device protection plans. Also contributing to the growth in service revenues was a 13% increase in roaming revenue. For the third year in a row, we tightly managed cost throughout the company. In fact, for the year, cash operating expenses rose just 0.4%. Key to this was a company-wide initiative that has provided $500 million of cumulative cost savings over the last 3 years. And we believe we have more opportunities in 2020. One highlight was our ability to manage network cost, given the impact from increased data usage. To put this in perspective, for the full year, data usage grew 39%, while systems operation expenses were essentially flat, quite an accomplishment. The combined result of all these actions as we grew adjusted EBITDA 5% in 2019. Network quality remains core to our customer satisfaction strategy. In 2019, we continued to invest in the network to accommodate increased data usage and to enhance the customer experience. We ended the year with multi-technology available to nearly 70% of our customers. And deployment to the final markets is expected to be largely completed in 2020. And we began to deploy 5G technology in Iowa and Wisconsin, our first 5G markets, with commercial launches planned in the next couple of months. Now I'll turn the call over to Doug Chambers, who will take you through the quarterly results. Doug?

Thanks, Ken, and good morning, everyone. I want to talk first about postpaid handset connections shown on Slide 7. Postpaid handset gross additions for the fourth quarter were 130,000, down from 136,000 a year ago due to aggressive industry-wide competition on both service plans and devices. Postpaid handset net additions for the fourth quarter were positive 2,000. This was down from 20,000 last year, driven by the decline in gross additions and higher churn. I'll touch more on churn in a moment. On a sequential basis, both gross and net additions improved due primarily to the normal seasonal trend. In addition to smartphone gross additions, we continue to have existing handset customers upgrading from feature phones to smartphones. As you can see on the graph on the right side of the slide, including the upgrades, total smartphone connections increased by 27,000 during the quarter and by 71,000 over the course of the past year. That helps to drive more service revenue, given that ARPU for a smartphone is about $22 more than ARPU for a feature phone. Next, I want to comment on the postpaid churn rate shown on Slide 8. Postpaid handset churn, depicted by the blue bars, was 1.11% for the fourth quarter of 2019, higher than last year, driven primarily by aggressive industry-wide competition. Total postpaid churn combining handsets and connected devices was 1.38% for the fourth quarter of 2019, higher than a year ago and flat sequentially. Now let's turn to the financial results. Total operating revenues for the fourth quarter were $1 billion, essentially flat year-over-year, while service revenues increased $9 million. Retail service revenues increased by $3 million to $666 million. The increase was due largely to higher average revenue per user, which I'll cover on the next slide. Inbound roaming revenue was $42 million. That was an increase of 11% or $4 million year-over-year, driven by higher data volume. Finally, equipment sales revenues decreased by $8 million or about 3% year-over-year. This was primarily driven by a decrease in the number of devices sold. As I mentioned earlier, there was a decrease in gross additions activity year-over-year that impacted device sales. In addition, we are continuing to see that existing customers are holding onto their devices for increasingly longer periods, resulting in a slight decrease in upgrade transactions. Now a few more comments about postpaid revenue, shown on Slide 10. Average revenue per user or connection was $46.57 for the fourth quarter, up $0.99 or approximately 2% year-over-year. The increase was driven by several factors, including a higher mix of smartphones relative to connected devices, a shift in service plan mix to higher-priced plans and increased device protection revenue. 43% of our postpaid connections are now on unlimited plans versus 27% a year ago. Partially offsetting these increases were higher promotional sales costs. Also, there was a decrease in universal service fund revenues resulting from the FCC's December 2018 ruling that revenues from text and multimedia messaging services are no longer accessible under the Universal Service Fund. As a result, this year, U.S. Cellular stopped charging customers and will no longer pay the FCC USF fees on these revenue streams. Because this change also affected general and administrative expense by a light amount, it is neutral to earnings. Looking through this change, ARPU on a comparable basis increased by $1.39 year-over-year versus the reported increase of $0.99, a pretty strong result. On a per-account basis, average revenue grew by $1.39 year-over-year. Excluding the USF impact that I just discussed, ARPA increased by $2.42 or 2%. Let's move next to our profitability measures. First, I want to comment on adjusted operating income before depreciation, amortization and accretion and gains and losses. To keep things simple, I'll refer to this measure as adjusted operating income. As shown at the bottom of the slide, adjusted operating income was $181 million, up 6% from a year ago. Correspondingly, the margin as a percent of total operating revenues was up 1 percentage point to 17%. For those watching service revenue margin, the current quarter result was 24%, an increase of 1 percentage point year-over-year. As I commented earlier, total operating revenues of over $1 billion were essentially flat year-over-year. Total cash expenses were $871 million, decreasing $10 million or 1% year-over-year. Total system operations expense decreased year-over-year. Excluding roaming expense, system operations expense decreased by 2% despite a 47% growth in total data usage on our network. Roaming expense decreased 4% year-over-year, primarily due to lower rates, partially offset by a 50% increase in off-net data usage. Cost of equipment sold decreased due to a decrease in the number of devices sold and a higher mix of used device sales, which primarily represent the resale devices returned or traded in by customers through our device service program vendors. SG&A expenses increased 1% year-over-year due to higher selling and marketing cost. Shown next is adjusted EBITDA, which starts with adjusted operating income and incorporates the earnings from our equity method investments, along with interest and dividend income. Adjusted EBITDA for the fourth quarter was $222 million, up 4% from a year ago. The improvement is due to the increase in adjusted operating income. This was partially offset by slight decreases in equity and earnings of unconsolidated entities as well as interest and dividend income. Adjusted operating income and adjusted EBITDA do not include depreciation, amortization and accretion expense. In connection with the network modernization and 5G initiatives, we are upgrading several of the network equipment elements. This results in the recognition of accelerated depreciation on certain of the assets being replaced. As a result, depreciation, amortization and accretion expense was up 10% from a year ago. Now let's turn to Slide 13, where we show our full year financial results. Total operating revenues were $4 billion, an increase of $55 million or 1% year-over-year. This was driven by increase in retail service revenues due to higher average revenue per user. Also contributing to the increase was higher inbound roaming and tower rental revenues. Total cash expenses were $3.2 billion, an increase of $13 million year-over-year. This was due primarily to an increase in selling, general and administrative expenses, driven by information system initiatives as well as an increase in bad debt expense. System operations expense was essentially flat despite a 39% increase in data usage on our network and a 33% increase in off-network data usage. Adjusted operating income and adjusted EBITDA grew 5%. This was primarily driven by the increase in operating revenues. Now I will turn the call back to Ken.

Thanks. Slide 14, and our plans for the year 2020. In order to strengthen our base, we'll build on a number of initiatives already in the works. For example, earlier this month, we initiated service in Sioux City, Iowa and Northern Wisconsin, expanding our addressable markets. We will continue to build upon the branding work we introduced last year, and will continue to evolve our plans and pricing but in an economically responsible manner. In terms of revenue growth, unlimited plans are still only 43% of our base. So we expect customers to continue to migrate to these plans. We also expect customers to purchase additional services like device protection, and we still have 396,000 feature phones on our network, which provides us the opportunity to migrate these customers to smartphones also. 5G should help to address customers' growing demand for more data and faster speeds as well as create opportunities for new services. I am also optimistic about the opportunities in the B2B marketplace, what you call Smart City Internet of Things, interest is growing, and fixed wireless broadband continues to be a complementary product for those customers who do not have access to adequate broadband service today. Customer expectations are always changing, and we are rolling out new programs and new tools to ensure that we better understand and engage with our customers by using data and analytics. We continue to utilize the life cycle management programs, and we are embarking on a number of initiatives like personalization that can be both predictive and proactive. Continuous evaluation of the format and location of our retail stores is even more important as customers continue to change their shopping preferences. Turning to Slide 15. In 2020, we will continue to foster [ soliciting ] engagement, especially since our associates who are U.S. Cellular's competitive advantage. And lastly, we will continue to invest in the network to meet ever-increasing data demand, finish the last VoLTE launches and start down the road to 5G. Doug will provide greater detail on our capital spending plans in just a minute or so. In closing, I'm very proud of this organization. We have built a great foundation, and we have the best associates in the industry. That team and the opportunities in front of us have me excited about 2020. Now let me turn the call back to Doug.

Thank you, Ken. Our guidance for 2020 is shown on Slide 16. For comparison, we're also showing our 2019 actual results. First I want to comment on a change in our revenue guidance approach. Rather than providing guidance on total operating revenues, which includes both service and equipment revenues, we are providing guidance on service revenues only. Variations in equipment revenues typically have a corresponding impact on cost of equipment sold and as a result, are less impactful to our profitability measures. And therefore, we believe that service revenues are the more meaningful revenue measure for guidance purposes. For total service revenues, we expect a range of approximately $3.0 billion to $3.1 billion. This reflects our expectation of a continued highly competitive environment. We expect adjusted operating income to be within a range of $775 million to $900 million and adjusted EBITDA within a range of $950 million to $1.075 billion. This guidance reflects our estimates for low single-digit growth in revenue and the increased network costs related to our 5G deployment and ongoing network modernization programs, partially offset by the impact of cost savings initiatives. For capital expenditures, the estimate is in a range of $850 million to $950 million. This year, in order to provide more transparency on actual 2019 and estimated 2020 capital expenditures, we have provided a breakdown by major category. There is a lot going on in the network space in 2020. We will be completing our organizational VoLTE rollout, continuing our low-band 5G rollout and hopefully, beginning our targeted millimeter wave 5G deployment. Admittedly, this is a large 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. In that case, we would be at or even below the low end of our guidance. And now I will turn the call over to Jim Butman.

Thank you, Doug. Good morning. I am pleased to be able to share with you that our transformation is well underway, and our future at TDS Telecom is bright. As Ken did, I want to spend a few minutes providing a little longer-term perspective on the progress we have made and how our investments are paving the way for the future. We are in a strong position today due to a number of growth-focused initiatives that we have been executing on for over 5 years. These initiatives include our fiber strategy, both in and out of our existing footprint and our acquisition strategy. Our investments in fiber-to-the-home are not new. In fact, we made a strategic shift away from upgrading copper in our most attractive ILEC markets to deploying fiber, augmented with superior products and hyper-localized marketing and sales. The success we saw with this transformational change was the catalyst for us to develop then test our out-of-territory fiber deployment strategy. During 2019, we scaled up and now our out-of-territory strategy -- fiber strategy is in full swing. We now have approximately 230 fiber service addresses in the hopper. Vicki will go into further detail of where these are in the process. To address the broadband needs of our most rural markets, we advocated relentlessly and then secured over $1 billion in A-CAM funds over the program period. This is allowing us to bring higher broadband speeds to our most rural customers, which helps drive fiber much deeper into our network. We also secured over $30 million in state broadband grants over the past 5 years. We bought our first cable company in 2013 and have continued to add to that portfolio with smart cable acquisitions and tuck-ins. These acquisitions are a natural extension of our broadband strategy, and we have been able to leverage expertise and resources across our business to drive strong financial results. Over the past 5 years, our cable segment generated $1 billion in revenue and $289 million in adjusted EBITDA, helping to drive growth and offset secular declines in our legacy business. During that period, we improved our cable adjusted EBITDA margin from 24% to 33%. These charts show our investment thesis and position is very different from our peers. Turning to the specifics for 2019, for our wireline segment, it was really all about fiber construction and launching new markets, both within and outside of our current footprint. However, there was so much foundational work that was done that you cannot see in our reported results, identifying additional markets and scaling up our organization to be able to execute on this program, today and for years to come. We are successfully redeploying cost savings from our legacy businesses to investing in our broadband growth initiatives. Our cable segment continues to perform well, showcasing the success of our broadband strategy. We purchased cable properties in attractive markets, which continue to provide a nice tailwind to our growth, and we are very pleased with our cable acquisitions. The latest one, Continuum, closed on December 31 of last year. The Continuum markets located just north of Charlotte, North Carolina, represent just the type of demographics and household formation growth we find attractive. Now I'd like to turn it over to Vicki to talk about full year and fourth quarter financials.

Okay. Thank you, Jim, and good morning, everyone. Let me briefly highlight our financial results for the full year shown on Slide 21. Revenues, cash expenses and adjusted EBITDA are relatively flat. However, as Jim mentioned, this result masks the significant transformation taking place across our business. Consolidated revenues increased slightly from the prior year, as revenues from our investments in both fiber expansions and cable have exceeded the declines we've had in our legacy business. Cash expenses increased 1%, as we redeployed spending from our legacy businesses to our growth initiatives. Adjusted EBITDA was effectively the same as last year at $313 million. On Slide 22, for the fourth quarter, we see repetition of these trends. TDS Telecom grew consolidated revenues 1% due to $4 million of growth in cable revenues, which was partially offset by the decline in wireline revenues. Cash expenses increased 2%, mostly in the cable operations, which incurred closing costs related to the Continuum acquisition. As a result, adjusted EBITDA in the fourth quarter decreased 3% to $75 million from a year ago. Capital expenditures increased 35% to $124 million as we continued to invest in our fiber deployment. This quarter, we launched 3 new out-of-territory fiber markets: 1 in our Southern Wisconsin cluster; and 2 in our Coeur d’Alene, Idaho cluster. And so far, we are very pleased with how these markets are performing. More to come on our total fiber program in a minute. But for now, let's turn to our segments, beginning with wireline on Slide 23. From a broadband perspective, residential connections grew 3%, driven by significant growth in our out-of-territory markets. We are offering up to 1 gig broadband speeds in our fiber market. Across our wireline residential base, 30% of all broadband customers are now taking 100 megabit speeds or greater compared to 24% a year ago, helping to drive a 4% increase in average residential revenue per connection in the quarter. Wireline residential video connections grew 8% compared to the prior year. Video is important to our customers. Approximately 40% of our broadband customers in our IPTV markets take video, which, for us, is a profitable product. We expect to see increasing trends in this metric as we are seeing higher results in our out-of-territory markets. TDS Telecom continues to grow its overall IPTV customer base by targeting markets and segments that find value in bundling services. Slide 24 summarizes the status of our multiyear fiber program. As a result of our fiber deployment strategy, over the last several years, 30% of our wireline service addresses are now served by fiber. This is driving revenue growth while expanding the total wireline footprint. Our current fiber plans include roughly 230,000 service addresses, of which about 50,000 were turned up in 2019. Plans for our current footprint are aimed at household growth and expansion in our current fiber market as well as overbuilding existing copper markets. Plans for our out-of-territory markets currently include our Wisconsin and Idaho clusters, which we have recently expanded to include the Meridian, Idaho area. We are planning for additional markets in the Pacific Northwest and are evaluating expansion in our major clusters. Now looking at the wireline financial results on Slide 25. Total revenues decreased 1% to $171 million. Residential revenues increased 3%, due to growth from video and broadband connections as well as growth from within the broadband product mix, partially offset by a 4% decrease in residential voice connections. Commercial revenues decreased 10%, primarily driven by lower CLEC connections, and wholesale revenues were flat compared to 2018. Wireline cash expenses were flat. We continue to see reduced costs of legacy services, partially offset by higher video programming fees. Employee expenses were held flat as we staffed up to launch new markets, which were offset by a continued focus on cost discipline. Maintenance expense increased as we incurred storm damage during the year. Wireline adjusted EBITDA decreased 6% to $54 million, due primarily to the reduction in commercial revenues. Now moving to cable on Slide 26. Cable total revenues increase as customers continue to value our broadband services. As Jim mentioned, we acquired Continuum at December 31. So while we've included connections in our results, we did not have any income statement impact for 2019 other than closing costs. Total cable connections grew 10% to 371,000, which included 31,000 from the acquisition and a 6% organic increase in total broadband connections. Organic broadband penetration continued to increase, up 100 basis points to 44%. On Slide 27, total cable revenues increased 7% to $64 million, driven primarily by growth in broadband connections for both residential and commercial customers. Our focus on broadband connection growth and fast, reliable service has generated a 17% increase in total residential broadband revenue. Also driving this growth is an 8% increase in average residential revenue per connection, driven in part by customers rolling off promotions, higher product mix and price increases. Cash expenses increased 8%, due primarily to additional costs related to the acquisition and plant maintenance. As a result, cable adjusted EBITDA increased 4% to $21 million in the quarter. Now I will turn the call back to Jim to discuss our 2020 priorities.

Thank you, Vicki. I think of our investment priorities in 3 buckets: network, products and people. Broadband is our primary product and our investments are focused on fiber deployments, strengthening our cable operations and meeting our first milestone of the A-CAM program. We also will continue to innovate what we sell and how we sell it. TDS TV+, our next-gen cloud-based TV service was launched this week in our first market, and we will roll it out throughout 2020 in our cable and wireline operations. TDS TV+ plus is a far superior product that makes it simple to find great programming with a recommendation engine and voice search that integrates traditional TV content with Netflix, YouTube and other over-the-top apps. This service is available on our new set-top box, along with Apple and Android phones and tablets. We are also helping our customers lower their bill with a road map that will allow them to use the service on streaming devices in lieu of purchasing extra set-top boxes. Continuing on Slide 29. A critical component of our success this year and into the future is our ability to identify markets where our formula wins. We have built a robust model whereby we screen for criteria listed here and prioritize the most attractive market. Extensive analysis goes into this along with detailed financial modeling for each potential market. Our models are adjusted in real-time with actual results and key learnings. Finally, I want to call out a significant strength of our organization, and that is how lean we operate. While we have wonderful growth opportunities ahead of us, we can't lose sight of the need to continuously take cost out of the legacy business so we can redeploy those savings into our growth initiatives. Before I turn it back to Vicki, I want to express my thanks to our entire team. This is a team that has demonstrated, time and again, they can execute. 2019 was an incredibly busy year, full of lots of successes as well as key learnings. Energy, confidence and enthusiasm everyone comes to work with each day has positioned TDS Telecom to achieve great things for many years to come. Back to you, Vicki.

Okay. On Slide 30, we've provided our 2020 guidance. We are forecasting total telecom revenues of $950 million to $1 billion compared to $930 million in 2019. For wireline, new fiber market growth will be strongly additive to continued growth in residential broadband and video connections and revenues. Commercial revenues and residential voice revenues will continue to decrease, as will wholesale revenues. We expect organic cable revenue growth in the mid-single-digits, reflecting continued strong growth in broadband. Our recently completed acquisition will add an excess of $20 million to revenue. Adjusted EBITDA is forecast to be within a range of $290 million to $320 million compared to $313 million in 2019. Contributions from wireline broadband and video growth, combined with growth from Cable as well as cost reductions, will continue to help offset pressures in the legacy wireline business and expected its fiber expansion costs in our new markets. Capital expenditures are expected to be between $300 million and $350 million in 2020 compared to $316 million in 2019. Wireline CapEx guidance includes $150 million dedicated to in and out-of-territory fiber deployments, a 50% increase over 2019 spending as well as $60 million in success-based spending for both wireline and cable and approximately $30 million allocated to the A-CAM program. And now I'll turn it back over to Jane. Jane W. McCahon: Thanks, Vicki. And just a quick update on OneNeck IT solutions. OneNeck IT solutions continues to make very good progress, driving revenues in strategic solutions, including multi-cloud hosting, managed services and professional services. The OneNeck team had a strong finish to the year, showing improvements in revenues while driving operational improvements in its cost structure. OneNeck is well positioned going into 2020 as they continue to leverage a multi-cloud strategy with plans to roll out their next-generation ReliaCloud platform and plans to expand upon their public cloud strategy by offering additional platform-based services via both ReliaCloud and Azure. Offering customers solutions architected around a highly secured framework will continue to be the cornerstone of OneNeck's offering. And now Michelle, we'd like to open the call up for questions.

[Operator Instructions] Your first question comes from Rick Prentiss from Raymond James.

Couple questions. First, now that the Sprint-T-Mobile merger seems like we're almost to the finish line, wanted to ask, Ken, kind of what do you think of the industry structure with DISH coming in as a fourth 5G operator, cable companies with their MVNO strategy, AT&T with its FirstNet project, how do you think about the industry structure, competitiveness and where U.S. Cellular really fits in that and how you might work with that structure?

Well, that's a multipart question to start the day off on. It's fascinating the way -- to see how the industry keeps broadening its appeal, right? It's addressable market. We started off voice, voice data, voice data video, cable companies coming in. I see -- I think we're going to see continued evolution of this. And I think that how we fit is how we've always fit, which is our focus on mid-sized rural markets. We will continue to see a lot of headlines about different companies and different initiatives. But the reality is that most of their economics are driven out of much larger markets. Now winning more in, pick a market, Oregon too isn't going to change the economics of any large carrier. So that's where we get our bread and butter. And we will continue to focus on the needs of businesses, government entities and consumers in those markets.

Okay. Obviously, CapEx was one that is trending up as you buy spectrum and deploy it. Equipment supply side, capital is going up. How do you think about return on capital, what your hurdle rate for return on capital is and how you guys are going to achieve return on capital?

Okay. So yes, capital is going up. That's because we're in this overlapping period right now. We're still finishing up Voice over LTE, while we're starting down the road to 5G. And 5G, well, is -- well, the way I'm thinking about it, at least, there's 2 parts of that 5G investment. First is the one that is -- allows the network to operate a lot more efficiently, the fact that we were able to get a lot of spectrum and be able to deploy that spectrum on existing sites so that we can handle the next wave of demand less expensively than just putting out more cell sites, constantly, which drive both CapEx and operating expense. So there's a bit of a transition going on here. At the same time, 5G, I believe is going to show some very nice revenue opportunities for us. We see demand for fixed broadband of the wireless broadband continuing to take hold in places where you just can't make the cable in the fiber economics work. And we'll continue to do that. But more importantly, what we're starting to see even in Midtown cities is a desire to understand how 5G is going to help these government entities deliver their services to their customers, their tax base more efficiently. And that was something that I got to tell you, a year ago, yes, I heard about what we are doing in Dallas and big cities like that and didn't think it really applied. But having had the benefit of some of the conversations in mid-sized to smaller cities, I'm amazed at how advanced they are in some of their thinking. So a lot of that -- a lot has 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. While we can always add cell sites to deliver 5G in a local market, the first starting point is inside the core, which is what we're spending on right now.

And people have been debating if this 2020 will be a year for a "supercycle" with 5G iconic devices coming out. How is your view in the guidance right now and also your view of what's actually going to transpire with the switching pool?

Wow, too soon for me to tell. Yes, a lot of talk about it. But I think that we're still early in the 5G deployment. And in fact, if 5G deployment isn't far enough along, we actually run the risk of a dissatisfaction with consumers if we get the supercycle change and the network isn't there because people will expect something that isn't being delivered. So something I want to be very careful with.

Your next question comes from Philip Cusick from JP Morgan.

This is Reed for Phil. [ System fall of tower ] multiples have increased anywhere from a few turns to as much as 5x. So especially in the context of your CapEx guidance in the upcoming spectrum auctions, could you share your thoughts on taking on a partner or changing your stance on monetizing those towers?

I'm sorry, I didn't hear the very beginning part of your question.

Just talking about how tower multiples have really expanded anywhere from a few turns to 5x since the fall of 2019.

Okay. Yes, I think my stance on towers has been pretty consistent, maybe painfully so. And that is that they're a strategic asset, and they continue to be strategic. They continue to be important as we change our network configuration with 5G, just like it has with every other technology change. But what I also said was that spectrum is a strategic asset also. And it's -- I could justify. I could use a trade of one strategic asset if it allowed me to get another strategic asset. So towers for spectrum is something that we consider. But just towers for tower's sake isn't something that was in my current plan.

Great. And then maybe a second one separately. We've seen solid growth in cable, particularly broadband over the past year. Can you kind of estimate what the portion of out-of-territory build accounts for when you're looking at the total subscriber and revenue growth in cable? Like are in footprint markets less attractive as kind of the CapEx spending guidance makes it appear?

So let me make sure I answer your question. And if I don't, please follow back up. But Reed, this is Vicki Villacrez. As you're looking at cable, we are expecting strong broadband growth, similar to the trends you've seen all this year into 2020. And that's really separate from our out-of-territory broadband growth, which is in our wireline segment. And that growth is really offsetting some of the secular declines that we have in our wireline base, including the commercial declines that we're seeing from our CLEC business.

Your next question comes from Zack Silver from B. Riley.

On the U.S. Cellular side, you guys are emphasizing this idea of expanding addressable markets as a priority this year. Is this just a reference to the edge out expansions you guys are doing over VoLTE? Or is there anything beyond that? And also wondering if you can help us kind of think about the growth rate in covered pops over the next year or 2.

Yes. There's 2 aspects to it, Zack. One is the small -- what I'd call the small impact of the edge out, right? It's not that material, but they are adjacent -- markets that are adjacent where we can leverage our network, we could leverage our distribution and name awareness. I think the bigger opportunity is what we're trying to do with the brand refresh. We've been in these markets for a long, long time, and we've got a loyal, strong following. But it's really focused in just a couple of segment. And what we're trying to do with the brand refresh is open the eyes of other segments and show how we can better meet some of their needs. And it's been an evolution that has resulted from some product and positioning statements that were great decisions when we made them years ago. But as the business changed, we found ourselves less relevant in certain segments. What we're trying to do with the brand refresh is really open the aperture in our current markets, which is a much bigger opportunity.

Okay. Makes sense. And then another one for you, Ken. Just given that it looks like T-Mo-Sprint is going to go through and you've got DISH coming in as a new entrant, anything that we should think about in terms of the trajectory of both the roaming revenues and roaming costs?

Boy, that's a great question. I think we have got most of the -- most of work done around the cost side already. I think we -- the team has positioned us really, really well in terms of allowing our customers to get the benefit of their packages wherever they're at and doing it in a way that we can afford to do that now. On the revenue side, the fact that we've got agreements in place with all 4 of the major carriers, and if DISH comes in, they probably come in as a reseller first. I think there's an opportunity for us to continue to see growth in that. How transitions work and everything else, we'll still see. But I'm pretty positive about where we've positioned our roaming business right now.

Okay. Great. Helpful. And then if I could switch over to the telecom side for a quick one for either Vicki or Jim, could you just remind us what your sort of target penetration rates are for the out-of-territory fiber builds? And also, has there been any change in competitive intensity in either the current or future launches that you guys have seen?

I'll take that one. So in our out-of-territory fiber markets, we're hitting penetrations over 50%. So to translate that to market share, it's up in the [ 60% ] range in our out-of-territory. And the only area we've seen any competitive reaction is largely in MDUs, where as we go into them, whether it's charter, we largely have charter out there in some of our markets where they locked up. Just we can still sell into them but they've got marketing agreements, but not anything. And we've actually seen much better improvement in our -- that was the consumer penetration. We're actually really pleased with our commercial penetration. We're seeing much stronger ramp up in our commercial penetrations earlier than in our business cases. So that's what I said earlier, we're adjusting those. So we just -- in all of our new markets beyond now Sun Prairie, we are seeing performance at or better than the Sun Prairie market. So we're really bullish on this opportunity.

Your next question comes from Simon Flannery from Morgan Stanley.

Great. Ken, you talked about spectrum. And you have a slide showing mid-band spectrum as being key to 5G. So how are you thinking about CBRS and C-band and how much you need there to be successful? And a related question, what's your thoughts on dynamic spectrum sharing?

I'm going to let the experts talk about dynamic spectrum sharing, things that are well beyond my headlights. And Mike Irizarry, our CTO, is sitting here just waiting for that. As a kind of strategic matter, the discussions that we've had, like CBRS, we view that more as augmenting our network, not one that becomes primary but have some nice benefits and could have incremental value. C-band, we like. There's a lot going on with that spectrum right now. And I have, and we will continue to encourage the FCC to make as much of it available as possible. How much do we need? I don't know, we know what we need. I know I like a lot. But like -- I would have liked to have seen all 500 of it come into the marketplace as opposed to the 280. But the 280 is a nice starting point if that finally gets approved. But I think that it is important, especially in less densely populated markets. So I'd like to see a significant additional mid-band spectrum come into the marketplace, and we're working with CTIA at the industry level as well as working with regulators to see what we can do in that area. Mike, talk a little bit about dynamic spectrum sharing.

Yes. Simon, so DSS is a -- we think it's a great technology. It's just coming to market now. So we'll be testing it. We do not need it for our initial deployments of 5G that we're working on right now. As you know, we have clean 600 megahertz, which we think is an advantage for us versus others who are deploying 5G in the lower spectrum. But in later waves of deployment, we will look to test and deploy DSS to take advantage of some of its capabilities.

Great. And just a quick follow-up on CapEx, Ken. Given this sort of overlapping period you said, does that mean, assuming the equipment is there, that we should think of 2020 CapEx as kind of being the peak in the cycle? Or is it more level at this level?

Don't know. And the reason I say don't know is that our 5G deployment, at least in 2020, starts on millimeter, right? And we've said we're starting in millimeter late in this year because that's what we have. If, in fact, there was a path to mid-band, you might see us moving there because with better coverage patterns and that may actually -- that will impact whether or not you need as much capital to get the same coverage. So I've got to wait to see how the spectrum positions play out over the next 12 to 18 months before I can really comment on that.

Your next question comes from Sergey from GAMCO. Jane W. McCahon: And this will be our last question.

Just I guess, a follow-up on T-Mobile-Sprint. So obviously, it looks like the deal is going to close more likely than not. So assuming it does close, I mean what do you think is going to be the immediate impact in your markets? And what is going to be a longer-term impact on your markets? And also on a related note, have you seen any T-Mobile overbuilds on 600 in your markets over the past 3 to 6 months?

I don't know what the impact is going to be. Short term, I'm sure there's going to be a lot of advertising. But by that same token, this isn't a surprise, right? This is -- it's been coming. It's been coming for some period of time, and changes we've made to our product offering, changes we've made to our brand positioning and our network are all aimed at positioning us well for that. In fact, we will -- we look at this and say, there's a couple million Sprint customers in our market. They've all got to make a decision, and we think that we've got the perfect solution to their wireless needs. So short term, I think there is some opportunity. Longer term, as I said before, notwithstanding a lot of a lot of headline risk, the fact of the matter is the economics of that deal will -- are not going to be made or broken by what happens in mid-size and rural markets. It's going to be what happens in the big markets. And that's where I expect to see most of the action.

And have you seen any increase in T-Mobile's activity in terms of tower builds on 600 lately?

Not that I'm aware of. I mean we saw some a year ago, but I -- we have not seen much in the last 6 months.

Okay. And I guess on the flip side of this merger, I mean maybe you could look at this as an opportunity. I mean it looks like your 5G network architecture and 5G build strategy is similar to T-Mobile-Sprint's. I mean you start from 600. You moved to millimeter wave and potentially supplement this additional mid-band. So does that create an opportunity for you to partner with an entity that is going to have arguably a very strong network in the next few years? Whether it's roaming, whether it's any other partnerships, whether it's potentially becoming an affiliate in certain rural markets where you have expertise but they don't. So I mean if you could share your thoughts on that angle.

I am constantly looking for opportunities to enhance our competitive position, grow revenues into our reduced costs. And anything with any carrier that does that is something that we have explored in our interest and will continue to explore.

Great. And in terms of cable competition, how much of an impact did cable have in your market last quarter? And looking at basically the customers who switched to cable and then eventually come back, if you could share any thoughts on the percentage of customers who you are able to win back.

I don't have those numbers in front of me, Sergey. We did see in 2019 an impact in our feature phone in our low-end users that, for price reasons, have moved into some bundled packages. I'd say the pace of that has slowed down. But we definitely felt it last year. Jane W. McCahon: Okay. Michelle, I think that's it for today. We'd like to thank everybody for joining us, and we will talk to you over the course of the next week or 2. Thanks so much.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.