How the 8th-largest cell carrier beat T-Mobile to the iPhone

By Mark Milian, CNN November 4, 2011 -- Updated 0352 GMT (1152 HKT) | Filed under: Mobile

C Spire, a small regional cell carrier, will begin selling the iPhone on November 11.

San Francisco (CNN) -- The three largest U.S. cellular carriers by subscribers sell the latest iPhone, and next week, eighth-place C Spire Wireless will join the group.

Some people were taken aback this week when C Spire, which only has stores in Mississippi, Southwest Alabama and Southwest Tennessee, announced that it will begin carrying the iPhone 4 and 4S on November 11.

Among those grumbling over the news were some of T-Mobile USA's 33.6 million subscribers. How, they asked, could a regional carrier get the coveted product before one of the big four?

C Spire's infrastructure is based on a cell standard used by Verizon Wireless and Sprint Nextel, which now both have the iPhone, but it is not common in other countries. C Spire, formerly Cellular South, has a deal with Verizon so that customers who travel outside of its Mississippi home base can still make calls.

Since C Spire's network uses the same underpinnings and antenna bands as Verizon, Apple did not have to make modifications to its phones beyond what it already did for Verizon when it launched there in February. An Apple spokeswoman confirmed that C Spire would begin selling the phone next week, but she did not respond to a question about whether the company needed to modify the hardware.

The iPhone 4S, Apple's newest gadget, uses a special antenna receiver from Qualcomm that works on typically incompatible networks. "IPhone 4S is now a world phone, so both GSM and CDMA customers can roam worldwide on GSM networks," Bob Mansfield, Apple's head of hardware engineering, says in a promotional video.

T-Mobile's network runs on the global standard called GSM. AT&T Mobility also uses GSM. That's what makes T-Mobile an attractive takeover target for AT&T, which plans to bolster its own network using T-Mobile cell towers, as long as the merger is approved. (C Spire, along with Sprint, are suing to block the acquisition, saying it will reduce competition.)

While AT&T and T-Mobile use the same basic network infrastructure, their cell signals operate on different antenna bands. That prevents T-Mobile from easily making iPhones run on its network.

When asked why C Spire got the iPhone before T-Mobile, Brad Duea, a T-Mobile senior vice-president, smiled, having likely fielded the question before.

"The iPhone already works with their bands," he said in an interview on Wednesday. "They didn't have to change anything."

Since the original iPhone came out in 2007, owners have been able to take the devices to T-Mobile, swap out a SIM card and use them on the network. But as Apple has added 3G and faster data speeds for AT&T, the unofficial T-Mobile iPhones -- more than a million in all, T-Mobile has said -- have not been able to exceed 2G speeds. AT&T's and T-Mobile's 3G and so-called 4G networks operate on different bands.

Another T-Mobile executive, Cole Brodman, recently addressed the issue publicly at a conference and in a letter to customers, though not in great deal. Executives say that, while they'd like to have the iPhone, Android is a fine alternative to the iPhone.