• Epo induced prolonged phosphorylation of proliferation signals in UT-7 cells. • cEpo induced only transient phosphorylation of proliferative pathways. • PTP1B activity was significantly increased in cultures with cEpo. • PTP1B colocalized with both subunits of the heterodimeric receptor used by cEpo. • Phosphatases are involved in the inability of cEpo to act as an erythroid growth factor.