On Wednesday, AT&T (NYSE:T, news, filings) unveiled a new network expansion and upgrade spending plan that covered a lot of ground. I’m afraid I skimmed it and thought LTE, no surprises there… But as a reader pointed out to me today, it’s actually got a blockbuster fiber-to-the-business component:
Fiber to Multi-Tenant Business Buildings. AT&T plans to proactively expand its fiber network to reach an additional one million business customer locations – 50 percent of the multi-tenant business buildings in its wireline service area. AT&T expects the proactive fiber deployment to increase business revenue growth, accelerate provisioning and facilitate the installation of distributed antennas systems and small cell technology to help offload wireless network traffic.
That’s 1 million business customer locations and the plan is to hook them up by the end of 2015, or three years from this New Year’s… Parsing that a little bit, they probably don’t mean 1 million separate on-net buildings, since each multi-tenant building will have many ‘business customer locations’ and most buildings aren’t multi-tenant. In AT&T’s case, multi-tenant here means 6 tenants or more, so it may be 50% of such buildings in their footprint but still a rather smaller fraction of the total number of enterprise buildings.
On the one hand, I’ve been rather surprised they haven’t done this before now. FTTH may have economic issues to solve, but fiber to the enterprise is much easier and you don’t have the worries about a wireless data deluge changing the game for the worse. Did something change, or did they just wake up and smell the metro fiber?
And on the other hand, this could pose a new challenge to the competitive fiber operators that have been aggressively targeting this space like tw telecom, cherry picking fiber territory while the big boys fret about spectrum. Yet will AT&T be as nimble and economical in this buildout as the alternative operators have become?
No answers here, we’ll have to see how it works out on the ground in the first half of 2013. Any opinions on how this will play out?
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Categories: ILECs, PTTs · Metro fiber
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Let’s review what another one of your “Special Olympics” posters had said, yesterday, I believe: “One day following Obama’s re-election, TREX the Dinosaur is committing to mega capital investments in both fixed and wireless networks……..”
Robert, you never deciphered for your board what “Pretty Boy Whitney Tilson”mentioned in the ICON/NETFLIX thread might be “DERIVED” from?
Go ask Parsad that!
Hint: There are still Depression Era Gangstas all around us posing as upright citizens. Pretty Boy Floyd, Baby Face Nelson, etc. LOL!
Did you use AT&T and nimble in the same sentence?
I assume this won’t help the pig (aka LVLT) with enterprise and their wholesale is already in bad shape. The incumbents own this pos. But nothing has ever seemed to help that ponzi scheme of a company except infinite can kicking while execs got rich.
I feel your pain and don’t disagree. However, you must remember that, most of the Level 3 executives whom you cite won’t be “really rich” until that snapshot in time where their “STOCK” really takes off.
Income is one thing, but tax deferred wealth is something “entirely different” by being worth “significantly” more most of the time.
This excludes those who were savvy enough to sell what became a $40B market cap in the heat of the TECH BUBBLE during Y2K even before the network had finished being built. Mr. Caruso might be an example of that here, along with one of his mentors, Mr. Crowe, and so would Mark Cuban in a different company.
Even Warren E. Buffett opined that, he had wished he sold his long term equity position in KO at the peak of the bubble notwithstanding the tax ramifications which would have net him less.
Look towards the politics of our time heading away from “The Status Quo,” and you might become more optimistic about their path going forward.
At a little over $4B market cap for as much as $40B in PP&E “cost new,” I can promise you that, “you are paying a dirt cheap price for such a dreary consensus.”
Yours truly, Special Olympics Poster #1
Remember that AT&T bought TCG (Teleport), the largest and most successful CLEC, in 1998. TCG had fairly robust business-oriented fiber networks in about 40 metro areas producing about $2 billion in revenues, mostly as the result of joint builds with cable companies that had owned TCG before AT&T bought it. A decade or so later, the TCG networks are probably ready for substantial upgrades/expansions.
I am excited to see that ATT will be speeding up their availability of service to businesses. I am still wondering how they can sell T1’s to businesses when Uverse is so much faster and cheaper.
Good Planning ATT