AT&T remains a fiber first network provider with FWA in rural areas

AT&T remains a fiber-first broadband broadband network provider.  The carrier’s CFO Pascal Desroches told investors that the most likely instance for AT&T to use FWA (fixed wireless access) would be in rural areas where deploying fiber could prove too costly.

“We think in certain instances FWA makes sense,” Desroches said during an interview at this week’s Bank of America Media, Communications, and Entertainment Conference, according to a transcript. “If you’re in a rural area where it does make – where the economics don’t pan out for fiber, fixed wireless will be an interesting solution.”

AT&T’s transition end game is predicated on the carrier’s belief that fiber is a better long-term solution for customers and its operations. Desroches explained that FWA extracts a “very expensive” toll on the carrier’s mobile operations.

“Long term, we don’t believe it will be good enough,” Desroches said of FWA. “And that’s why we think it is really important to start to place our bets now with fiber because by the time fiber becomes the only acceptable solution, it will be too late to start to build out because of the long lead times.”

Editor’s Note:  This is what investors are missing about AT&T – it’s growing fiber footprint (#1 in the U.S.) which is probably the biggest growth area in all of telecom!!!


“With connectivity increasing at what we estimate will be a fivefold increase between 2021 and 2025, fiber will be the solution of choice. And given the long lead times, the long payback periods, if you decide you want to do fiber 4 to 5 years from now, it’s too late. And this is why we think we are building a strategy for long-term sustainable earnings with the best possible technology.”

To support that need, AT&T recently signed a long-term deal with fiber builder Corning, which is using that deal as the basis to build a new cable manufacturing facility in Gilbert, Arizona. AT&T also formed a “Fiber Optic Training Program” with Corning targeted at training 50,000 people to design, install, and maintain fiber networks.

“This investment is a significant step forward for our country and building world-class broadband networks that will help narrow the nation’s digital divide,” AT&T CEO John Stankey noted in a statement tied to the Corning deal. “This new facility will provide additional optical cable capacity to meet the record demand the industry is seeing for fast, reliable connectivity.”

“The market demand remains really healthy. We’re continuing to see good demand for subscriber — for new subscribers coming into the service. And also, look, our churn levels are at really low levels. You look at all that together, we have a mobility business now that we expect service revenues to grow 4.5% to 5%. And we expect profitability to accelerate in the back half of the year. So all indications are green and that we are performing really well.”

“We’re going to be competitive. For years, AT&T was not competitive, and we’re going to be competitive, and we’re capitalists.  At the end of the day, if there are opportunities to grow subscribers in a more efficient way, we’re going to seize those. But at the same time, we’re no longer going to be the share donor to the industry.”

We have relationships with virtually over 90% of the Fortune 1000. And it’s a core competency that we have, and it’s one that has served us well. But it is very much in transition, and we’re — what we have to do is to grow our small, mid-business connectivity solutions.”

“There will be a very attractive market for 5G-enabled IoT solutions. There is — it will come. It is nascent today. It will come and the relationships that we have among the Fortune 1000 is critical to — is critical in serving — in helping exploit that opportunity.  And again, our wireless relationships. The big part of the growth in wireless is also the ability to surgically attack our enterprise base and partner with different organizations to really drive increased subscriber adoption.”


Corning to Build New Fiber Optic Plant in Phoenix, AZ for AT&T Fiber Network Expansion

AT&T continues to add customers in key focus areas- 5G and fiber

AT&T added 813K mobile postpaid subscribers & >300K net fiber subs during 2Q-2022


One thought on “AT&T remains a fiber first network provider with FWA in rural areas

  1. Light Reading: Why AT&T’s fiber gambit in Phoenix is worth watching
    AT&T announced it will build a fiber network in the Phoenix suburb of Mesa, Arizona, a move that competes with with cable company Cox Communications and fiber operator Lumen Technologies. The effort represents a test by AT&T to see whether it should expand its fiber network beyond the boundaries of its existing copper footprint.

    “We announced Phoenix a couple of weeks ago. We did that for a reason. That’s a test case for us to understand, are there attractive markets for us to build as the first fiber provider into a particular area that might make sense for our business?” AT&T CEO John Stankey said at a recent investor conference, according to a Seeking Alpha transcript. “And we’ll look at the data, and we’ll look at the results, and we’re going to look at our performance. And if we see the same kind of returns we’re seeing than what we’ve been building over the last couple of years, that’s a possibility that I’d come back and say, there’s another approach to this [fiber buildout] that makes sense for our business.”

    According to BroadbandNow, Cox and Lumen, operating under its old CenturyLink brand, are two of the biggest current providers in Mesa, Arizona. AT&T said it would begin offering fiber services up to 5 Gbit/s in Mesa starting next year, with the goal of covering 100,000 homes.

    Upgrading and potentially expanding

    AT&T has touted its ongoing plan to upgrade around half of its existing copper network footprint to fiber (and to offer fixed wireless Internet services across most of the other half of its copper footprint). That fiber project involves roughly doubling AT&T’s fiber footprint to around 30 million locations by 2025, making AT&T’s buildout one of the biggest fiber endeavors in the US.

    AT&T officials have repeatedly hinted that the operator’s ambitions may extend beyond those 30 million locations.

    “When I step back and I think about that opportunity right now, are there other markets maybe outside of our operating footprint, given our success and what we’re seeing in rate of penetration, receptivity of the product, our ability to cross-sell both fixed and wireless, we should understand whether or not there’s something there?” Stankey explained.

    In the second quarter of 2022, AT&T added 316,000 fiber customers, up from the 246,000 it scored in the year-ago quarter and extending its grand fiber subscriber total to 6.59 million. AT&T ended the quarter with 37% subscriber penetration in its fiber markets.

    Some analysts believe that AT&T could expand its fiber ambitions to other greenfield markets beyond Phoenix.

    “AT&T is not the incumbent phone company in Arizona and the carrier has little if any history of edging out,” noted Wave7 Research analyst Jeff Moore. “Could this effort give AT&T a wireless tailwind in Mesa and will AT&T have other edge-out efforts?”

    The Comcast and Charter factor

    Interestingly, Moore pointed to other recent examples of established wired Internet providers expanding their services into new markets. “With RDOF as a factor, Charter is expected to expand its cable footprint to 1 million customer locations in the coming years and there has been a torrent of specific announcements. Comcast just announced an expansion to 3,400 homes and businesses in Spring Hill, Kansas, as part of its plan to pass 800,000 additional homes this year with landline broadband,” he wrote in a recent report.

    Charter’s Rural Digital Opportunity Fund (RDOF) efforts currently stretch across 24 states. Via its RDOF winnings, Charter hopes to add more than 100,000 miles of new fiber network infrastructure to its existing 800,000 miles of infrastructure in the coming years.

    Moore added that AT&T, Comcast and Charter could all use their wireline expansions to improve the sale of related, bundled products, including wireless services.

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