AT&T Fools Entire Media With Giant Gigabit Fiber Bluff (1 Viewer)


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Dec 3, 2003

"AT&T is out-building Google Fiber," the Washington Post crows. AT&T is "outpacing every other competitor" when it comes to fiber to the home, an analyst tells Computer World. AT&T's building fiber "much faster" than everybody else, proclaimsUSAToday. These are only three of hundreds of similar stories this week insisting that AT&T is engaged in what can only be called a massive, unprecedented expansion of fiber to the home service to 38 more markets.

The problem? It's not really true.

What is true? Years ago, AT&T launched U-Verse, a fiber to the node service that cost less money to deploy than pure fiber, but to this day struggles to reach the kind of speeds provided by even cable. In some select areas where fiber was installed during construction, AT&T offers full fiber to the home, but traditionally the telco capped it at slower U-Verse speeds.

As AT&T's announcement notes, the company says it plans to deliver gigabit speeds to many of these users under the "Gigapower" brand. 16 markets already existed and 38 new launch markets were announced this week. But what the announcement doesn't tell you is that in the vast majority of these markets, AT&T's quite literally only offering gigabit speeds to a handful of development homes on a hill (or a college dorm), then calling this a market "launch."

In reality, AT&T has consistently been cutting back its fixed-line investment budget and CAPEX to focus on more profitable wireless (read: usage capped) broadband. There's no budget for the kind of "real" fiber build AT&T's press release implies. In fact, while AT&T pats itself on the back for this latest build, it has been consistently trying to figure out how it can gut regulations in order to hang up on millions of DSL users it doesn't want to upgrade.

And while AT&T this week promised its over-hyped fiber build will someday reach 14 million residential and commercial locations, they didn't give a timeline for this accomplishment. That means AT&T technically could be winding up this not-particularly ambitious attempt to cherry pick the nation's high-end development communities and university student condos -- by 2030 or so. We're potentially talking about only a few hundred thousand lines per year, many at universities.

There's a bit of a disconnect from that reality and the story being told in the national media this week. In fact, you'd be hard pressed to find one outlet mentioning these caveats.

You'll never see AT&T give hard numbers on how many users can actually get its gigabit service, or how many can actually sign up. That's because AT&T's gigabit fiber initiative is primarily a public relations show pony, designed to deflect criticism that the telco isn't keeping pace with deployments from the likes of Google Fiber or the growing number of nationalmunicipal fiber builds.

To be fair Google Fiber hasn't been a whole lot better of late, announcing markets that may or may not ever actually get service. And AT&T's not alone with what I affectionately refer to as "fiber to the press release." From Cox to CenturyLink, the fashion du-jour in the telecom industry is to cherry pick a few housing developments, claim we're witnessing a broadband revolution, then hope nobody will actually notice the vast, vast majority of your users remain on last generation speeds (often with usage caps).

That's why news outlets like The Shreveport Times are doing their readers a disservice by claiming AT&T gigabit fiber's coming to town, since the vast majority of the town will never actually get it. What we've seen time and time again after a Gigapower market "launch" is the majority of users heading to AT&T's site to only be told the service isn't available. If you canget it, you'll need to be aware that you have to pay AT&T a steep premium if you don't want to be snooped on.

Now yes, there's a few areas where AT&T will be forced to try a little harder thanks to municipal broadband and Google Fiber. As long as the cost and labor is barely existent (the only way you deploy fiber and have your CAPEX magically drop), AT&T will upgrade some users eventually. But everywhere else AT&T's going to be leaning heavily on the combination of recently acquired DirecTVsatellite TV service and heavily capped LTE wireless broadband, meaning that for the vast majority of AT&T users, gigabit fiber will be little more than a pipe dream.

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