October 6, 2016 – For those who are wondering where AT&T’s CapEx is going, look no further than the carrier’s plans to connect homes, apartments and small business locations in 11 metro areas in the Southeast to its gigabit internet service, which is part of its newly created AT&T fiber “umbrella brand.” This expansion increases its commitment to bring service to at least 67 metros, with plans to launch in 45 metros by the end of this year.
“We’ve already launched our ultra-fast internet service in parts of 29 of the nation’s largest metro areas. The ultra-fast service is now marketed to over 3 million locations, of which over 500,000 include apartment and condo units. We’re on track to exceed the 12.5 million locations planned by mid-2019,” said David Christopher, chief marketing officer of the AT&T Entertainment Group.
The carrier began building out metro areas with 100 percent fiber three years ago in Austin, Texas. In 2014, that number grew to 25 metros and it hit 56 metros in 2015. More than 1 million business have been connected to the fiber network since 2012.
AT&T has more than 1 million route miles of fiber globally. The AT&T Fiber umbrella brand, which replaces the AT&T GigaPower network moniker, gives customers the ability to choose from multiple internet speeds.
For AT&T the timing of this announcement made sense to the analysts at Wells Fargo, because of its plans to launch the over the top (OTT) wireless. The critical part of the bundle is maintaining its 100 million wireless users, according to Senior Analyst Jennifer Fritzsche, and ensuring a high-speed connection to the home where users can use OTT video services.
“In our view, ahead of the launch of these plans, there is a real incentive to illustrate to potential customers’ its commitment to spending on the broadband pipe. If AT&T is able to capture BOTH the wireless and broadband user with this offering, it makes that revenue all the more ”sticker” longer term,” she wrote.