A SIGNIFICANT MILESTONE FOR PCS 2003 was the 10th anniversary of Shentel’s decision to enter the PCS business and the 8th year operating as a Sprint PCS Affiliate. This year was a significant milestone for Shentel’s PCS business, as we posted our first profitable quarter and recorded net income for the year of $0.3 million versus a net loss of $5.4 million in 2002.  Our Sprint PCS wireless customer base continues to grow, with year-end customers at 85,139 spread from Harrisonburg, Virginia to Harrisburg, Pennsylvania. Our customers are averaging approximately 700 minutes of usage per month and we have one of the lowest customer churn rates in the industry. To keep up with this growth and improve our service, we continued investing in additional network facilities. We added capacity to 26 existing tower sites and installed 16 new tower locations bringing our total sites to 253. Our plan is to add capacity and build additional sites in 2004 in order to meet expected growth. We added a new type of customer in 2003. Through Sprint’s relationship with its wholesale cutomers, more than 11,000 pre-paid customers were added to our network. These pre-paid accounts, usually for customers with no established credit, are a low cost method to increase customers. They can purchase phones and some minutes at various convenience, electronic or department stores in addition to one of our company locations. When needed, they can easily purchase additional minutes. Camera phones and e-mailing pictures were hot in 2003. We now offer phones that can take and send a 15 second video. Late in the year, we launched Spirit PCS ReadyLink$^{sm}$, the Sprint walkie-talkie style service. It is hoped that these new services will be major sales drivers in 2004. In 2003, we focused on improving our distribution channels. We expanded and relocated our stores in Harrisonburg and Winchester, Virginia to handle our growing customer base. At our Edinburg, Virginia store, we expanded both our hours and office space. We continue to increase our direct sales force to expand our base of business customers. To make it convenient for our potential customers, we also grew the number of local third-party sales partners. A much publicized development in our industry was the introduction of Wireless Local Number Portability (WLNP) on November 24$^{th}$, 2003. Starting on that day, customers in the 100 largest population centers in the United States were able to change wireless carriers while keeping their existing phone number. WLNP will be available in the entire country on May 24, 2004. To date, this change has had only a minor impact on Shentel’s customer base. We continue to work to make PCS a growth vehicle of revenue and net income for Shenandoah Telecommunications Company.  9 ■  2003 ANNUAL REPORT