AT&T targets 50% coverage in its FTTH regions; U.S. Fiber Broadband Remarkable Progress
AT&T’s fiber-to-the-home (FTTH) technology could provide 50% of the connections in areas where it’s available within the next three years, the company says. 3.1 million people were subscribing to AT&T’s FTTH service as of June 2019, a 57% rate of growth from year to year.
“We have proof of how we do this historically,” Jeffrey McElfresh, CEO AT&T Communications, said at the Barclays Global Technology, Media and Telecommunications Broker Conference. “As you look at the fiber that we built out in the ground in 2016, at the three-year mark, we roughly approach about a 50% share gain in that territory. And so for 2020, with the bulk of our investments behind us in this fiber plan, our tactics are to drive penetration with the fiber that we’ve built.”
McElfresh said “the economic performance of our broadband business is very strong, setting aside subscriber losses in the lower speed DSL segment in the copper network.”
In markets where AT&T faces off against Comcast, Charter Communications and other cable broadband providers, “where we have fiber, we win and win handily,” he added. In a June 4 note to investors, MoffettNathanson analyst Craig Moffett said that AT&T had gained 1.1 million FTTH customers in the previous year, bringing its base at the time to 3.1 million subscribers, an impressive 57% annual growth rate.
“But from whom are these market share gains coming?” Moffett asked. “The short answer appears to be …. from AT&T itself.”
Indeed, rather than poaching customers from cable operators, AT&T has largely been upgrading existing DSL and U-verse users.
In any event, the No. 2 U.S. wireless operator appears to be charging forward with the strategy. It plans to bundle its new premium virtual pay TV service, AT&T TV, to drive FTTH growth.
At the Barclays conference, McElfresh said AT&T TV — which has been soft-launched in New York and a dozen other markets — will roll out nationally in February. That livestreamed service, which comes with a two-year contract, requires no truck rolls or satellite launches and requires half the capital spending of DirecTV satellite TV.
“Our growth agenda is on fiber and our entertainment group, and on the AT&T TV product that will be offered nationwide,” McElfresh said.
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Separately, a new report notes the tremendous progres fiber broadband has made in the U.S. recently. More than 20 million U.S. homes (20.5 million) are now connected to fiber broadband service, according to new research conducted by RVA for the Fiber Broadband Association. That’s a substantial increase since last year, when a similar FBA report found 18.4 million U.S. fiber broadband homes.
Fiber broadband has been making gains against DSL and fiber-to-the-neighborhood (FTTN). According to the researchers, 2019 was the first year when more U.S. homes received broadband service via fiber than via DSL or FTTN. That milestone makes fiber broadband the second most popular choice after cable modem service.
References:
https://www.multichannel.com/news/at-t-will-grow-on-fiber-diet