U.S. telcos on 5G rollouts (“vague promises”), devices, IoT/smart cities

Here’s what AT&T, Sprint, T-Mobile, and Verizon said about their 5G network rollouts, soon-to-be available devices, and Smart City plans at CES 2020:

AT&T on 5G Devices, Network Plans:

Carrier and media goliath AT&T talked about 5G devices at this year’s CES event in Las Vegas, NV.  Currently, AT&T only sells one 5G-capable phone, the Samsung Galaxy Note 10 Plus 5G, but AT&T plans to have 15 5G phones available for use on its low-band 5G spectrum during 2020 (see Comment in the box below this article). The Dallas-based service provider said that other mobile devices, such as laptops, tablets, and hotspots will also be available this year, but no exact number of products were provided.

AT&T’s low-band 5G network went live in December 2019 and is currently available in parts of 19 cities. The carrier’s other 5G network that is built on millimeter-wave and is referred to as 5G Plus is live in parts of 35 cities. AT&T said that it plans to cover 200 million people with its 5G network by this summer.

Sprint IoT, Smart City Updates:

Wireless provider Sprint could merge with T-Mobile any day now, but the Overland Park, Kansas-based carrier hasn’t slowed down in the meantime. Sprint took to CES to launch several new offerings and update the market on its IoT plans.

Sprint unveiled its Certainty network design model, which unites its entire business wireline portfolio, including its wireless, IoT, and security solutions. The carrier also launched IoT Factory 2.0, a dedicated platform that solution providers and businesses can use to build custom IoT solutions for small-to-mid sized businesses in the food service, healthcare and agriculture space.

Chris Brydon, Regional Vice President Sales, Sprint Business Northwest Region via LinkedIn:

We believe hashtagIoT has the power to improve people’s lives. Here’s a story illustrating how an IoT application can be so much more than just a cold, lifeless piece of tech. Watch the very human difference it makes in the lives of a man and his family. https://lnkd.in/gdyeT9N hashtagWorksForBusiness

Sprint updated the market on its Smart City initiative on Tuesday. Specifically in Georgia, the provider said that in 2020 “micropositioning” technology, which combines next-generation wireless technologies and small cells will be installed within city infrastructure in areas to enable real-world navigation for autonomous machines, more connected sensors and IoT solution testing in its innovation Center for solutions such as refrigeration and monitoring, and security robots in Peachtree Corners’ Town Hall. Sprint also has plans to integrate additional Smart City technology in Greenville, South Carolina, and Arizona State University.

T-Mobile Talks 5G, Avoids Sprint Mega-Merger Talk:

T-Mobile didn’t address the main topic on everyone’s mind when thinking about the Magenta-colored carrier: its in-progress $26 billion mega-merger with wireless competitor Sprint. Instead, the “Un-Carrier” took to the show to highlight its 5G connectivity.

In a surprising move last month, the Bellevue, Wash.-based provider launched its nationwide 5G network using 600 MHz spectrum acquired in the recent incentive auction, as well as two 5G phones capable of using its 600 MHz spectrum. T-Mobile originally planned to launch the network in 2020.

 Verizon 5G Devices and Ultra Wideband Availability:

AT&T’s biggest competitor, Verizon, also came to CES armed with 5G updates. Compared to AT&T’s 15 devices, Basking Ridge, N.J.-based Verizon vowed to have 20 5G-capable devices in 2020 and said these devices would be competitively priced anywhere between $600-$800. Currently, Verizon has four 5G-capable smartphones. Subscribers interested in 5G will have to pay an additional $10 on top of their current unlimited data plan, Verizon said, but the company didn’t name any specific device manufacturers.

Verizon’s ultra wideband 5G network is available in parts of 30 cities today, including Chicago, Los Angeles, and New York City, as well as Hoboken, N.J. Des Moines, Iowa; and Providence, RI.  Please see Comment in the box below this article.

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Mike Dano of Lightreading wrote that AT&T and Verizon made “vague (uncertain?) promises” for their 5G mmWave networks:

in a New Year-themed post, AT&T’s Scott Mair wrote that “you’re in for an exhilarating ride on the AT&T 5G network in 2020 and beyond,” but he did not offer any specifics about what the carrier will do with its “5G+” network. Then, during a subsequent appearance at an investor event this week, AT&T CFO John Stephens said only that the operator’s 5G network would “continue to improve and grow.”

Similarly, Verizon touted its “vision” for its network in 2020 in a release issued this week, but said only that customers should “expect more great innovations and technology advancements from us in 2020 including a more aggressive build out of our 5G network.” At that same investor event, Verizon’s Ronan Dunne said “we will be continuing to drive hard” in 5G, but didn’t offer any specifics.

The bottom line here is that neither operator is offering any concrete information on the number of cities, cell sites or customers it plans to touch with mmWave 5G in 2020. As Heavy Reading analyst Gabriel Brown writes, it’s time for these operators to show their hands.

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From a marketwatch.com article titled: The long-promised ‘Year of 5G’ arrives with more promises and little 5G

For years, telecommunications companies and gadget makers have invaded CES to talk about how big 5G was going to be in 2020.

At CES 2020 though the promise was still unfulfilled as the faster wireless service is still spotty and not entirely what was envisioned.

Without the premier connections that were promised, it is questionable how many consumers will buy the more expensive 5G-enabled devices that were introduced at the giant trade show this year, even though the same glowing predictions of a new future were readily available throughout Las Vegas.

5G promises faster data speeds, a reduction in lag time, and greater density for smart devices, all things that could eventually be catalysts for futuristic applications like autonomous driving and connected cities. More immediately, carriers are focused on exposing businesses and customers to those faster data speeds, where and when they can.

Verizon Communications Inc. expects to launch 20 devices with access to 5G by the end of the year, up from the seven that currently exist, according to Tami Erwin, who heads the company’s business group. AT&T Inc. mobility executive Kevin Petersen told MarketWatch at CES that accessibility will also be a key theme in the year ahead.

T-Mobile US claimed that it conducted a nationwide 5G rollout at the end of last year, providing access over a greater area but at slower data speeds than competitors. Verizon and AT&T both plan to add new cities to their coverage later this year, with AT&T still expecting to have nationwide coverage this year also.

Bob O’Donnell, president of TECHnalysis Research, cautions that these upgrades won’t happen right away due to some technical aspects of the 5G rollout. The more exciting type of 5G, millimeter-wave spectrum, primarily works outdoors and on campuses where it’s been specifically deployed. Sub-6 5G service works indoors and offers some benefits in speed and latency, but it’s a less dramatic step up from the 4G service consumers have come to know.

“The pieces are coming together but the forward-looking benefits are still a few years off,” O’Donnell said. Part of the issue is that 5G currently runs on top of 4G, rather than in a stand alone manner. Moving to stand alone 5G requires that carriers “refarm” spectrum frequencies from 4G to 5G, but they’re hesitant to make that big leap right away while most customers are still using 4G connections and while few phones support 5G.

“That’s like opening a 10-lane highway only for people with electric cars,” he said, since only a small minority of drivers would have access.

Making 5G a reality is a bit of a “chicken and egg” scenario, according to O’Donnell, given that carriers thinking about moving away from 4G want there to be enough devices in the market to take advantage of the new wireless standard, and consumers want to make sure 5G networks are broad enough before investing in a mobile device that works on the network.

The device part of the equation showed signs of progress at CES, with connected PCs being one notable category. Lenovo Group Ltd. announced it will launch in the spring the Yoga 5G two-in-one device, which it says is the first 5G PC. Always-connected PCs let customers rely on cellular connectivity rather than hunt for WiFi networks, and the 5G products shown by Lenovo, HP Inc. HPQ, and others offer faster speeds than 4G ones currently on the market.

Those devices are more expensive than competitive gadgets without access to the technology, though, and that will most likely continue to be the case. Samsung Electronics Co. Ltd. will be holding a smartphone launch in early February, where the company is expected to introduce a family of 5G Galaxy devices, and Apple is thought to be planning a 5G iPhone rollout later this year, with analysts expecting the 5G versions of those popular smartphones to carry a higher price tag.

Instinet analyst Jeffrey Kvaal expects “a large increase” in 5G unit sales for 2020, up from a small base of sales last year, but he thinks most of these sales will come at the expense of 4G devices, rather than a rush of upgrades. He estimates that 5G could boost a phone’s retail price by at least $75.

Today’s devices tend to be in the $1,000-plus range, but consumers should “start to see prices coming down, which ultimately helps the adoption curve,” as more mid-tier devices come to market this year equipped with 5G capabilities. Verizon’s consumer chief executive Ronan Dunne said at a Citi investor conference earlier this week that there could be 5G devices priced below $600 by the end of the year.

AT&T Chief Financial Officer John Stephens told investors at the Citi conference that trying to predict 5G unit sales is missing the point a bit, since handset sales are “not a profitable enterprise for a business like ours.” The company sees various new service revenue opportunities from being able to compete “in the geographies where our service has gotten much better.”

The promise of 5G goes well beyond smartphones, and executives pointed out that the services that have developed in the past decade likely wouldn’t have existed without the move to 4G.

“If someone was watching a streaming video on a connection 10 years ago, you would’ve swatted the phone out of their hand and said they were going to use up the whole monthly data plan in 13 seconds,” Qualcomm’s  vice president of engineering John Smee told MarketWatch. Now, streaming over wireless is commonplace. Verizon’s Erwin noted that the proliferation of ride hailing also wouldn’t have been possible without the upgrade in data speeds.

AT&T’s Petersen thinks it’s too soon to know what the killer use case for 5G will be, but he’s upbeat about its ability to provide upgraded experiences in gaming, translation and medicine. A reduction in latency, or lag time, could create better responsiveness for gamers and reduce awkward pauses when people are using mobile devices to translate from one language to another in real time. Doctors could more easily monitor patients remotely after procedures by using connected devices.

Over time, the expected benefits of 5G and the growth of accessible smart devices could change the way consumers and workers think about doing data-heavy tasks. Smee even suggested that it could replace the need for Wi-Fi for most users.

“If you think of your cable modem or your DSL and you look at the rates you get compared to the 5G data rate, all of a sudden wireless is the preferred medium and that’s a big game changer versus the idea that you have to have wired connectivity to have high data rates,” he said.

References:

https://www.crn.com/slide-shows/networking/ces-2020-top-telecom-carriers-talk-5g-new-devices-and-iot

https://www.lightreading.com/mobile/5g/heres-why-it-might-be-time-to-worry-about-mmwave-5g/a/d-id/756706?

https://www.marketwatch.com/story/ces-2020-the-long-promised-year-of-5g-arrives-with-more-promises-and-little-5g-2020-01-10

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.

Image result for image of fiber to the home

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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

https://www.telecompetitor.com/report-finds-20-5-million-u-s-fiber-broadband-homes-nearly-40-of-u-s-homes-passed/

AT&T and Verizon to use Integrated Access and Backhaul for 2021 5G networks

AT&T sketched out its plans to start testing Integrated Access and Backhaul (IAB) technology during 2020, saying it can prove a reliable backhaul alternative to fiber in certain cases, such as expanding millimeter-wave locations to reach more isolated areas. Verizon also confirmed, without adding any details, that it plans to use IAB, which is an architecture for the 5G cellular networks in which the same infrastructure and spectral resources will be used for both access and backhaul.   IAB will be described in 3GPP Release 16 (see 3GPP section below for more details).

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“Fiber is still required in close proximity to serve the capacity coming from the nodes, so if it can be extended to each of the nodes, it will be the first choice,” said Gordon Mansfield, VP of Converged Access and Device Technology at AT&T. in an statement emailed to FierceWireless.

“From there, IAB can be used to extend to hard to reach and temporary locations that are in close proximity. As far as timing, we will do some testing in 2020 but 2021 is when we expect it to be used more widely,” he said.

Verizon also told Fierce that it has plans to incorporate IAB as a tool. It doesn’t have any details to share at this time, but “it’s certainly on the roadmap,” an unknown Verizon representative said.

Earlier this year, Mike Dano of Lightreading reported:

Verizon’s Glenn Wellbrock said he expects to add “Integrated Access Backhaul” technology to the operator’s network-deployment toolkit next year, which would allow Verizon to deploy 5G more easily and cheaply into locations where it can’t get fiber.

“It’s a really powerful tool,” Glenn Wellbrock, director of architecture, design and planning for Verizon’s optical transport network, explained during a keynote presentation here Thursday at Light Reading’s 5G Transport & the Edge event.

Wellbrock said IAB will be part of the 3GPP’s “Release 16” set of 5G specifications, which is expected to be completed by July 2020. However, Wellbrock said it will likely take equipment vendors some time to implement the technology in actual, physical products. That means 2020 would be the earliest that Verizon could begin deploying the technology, he added.

Wellbrock said IAB would allow Verizon to install 5G antennas into locations where routing a fiber cable could be difficult or expensive, such as across a set of train tracks.

However, Wellbrock said that IAB will be but one tool in Verizon’s network-deployment toolbox, and that Verizon will continue to use fiber for the bulk of its backhaul needs. Indeed, he pointed out that Verizon is now deploying roughly 1,400 miles of new fiber lines per month in dozens of cities around the country.

He said Verizon could ultimately use IAB in up to 10-20% of its 5G sites, once the technology is widely available. He said that would represent an increase from Verizon’s current use of wireless backhaul technologies running in the E-band; he said less than 10% of the operator’s sites currently use wireless backhaul. He said IAB is better than current wireless backhaul technologies like those that use the E-band because it won’t require a separate antenna for the backhaul link. As indicated by the “integrated” portion of the “integrated access backhaul” moniker, IAB supports wireless connections both for regular 5G users and for backhaul links using the same antenna.

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According to 5G Americas, the larger bandwidths associated with 5G New Radio (NR), such as those found in mmWave spectrum, as well as the native support of massive MIMO and multi-beams, are expected to facilitate and/or optimize the design and performance of IAB.

5G Americas maintains that the primary goals of IAB are to:

  • Improve capacity by supporting networks with a higher density of access points in areas with only sparse fiber availability.
  • Improve coverage by extending the range of the wireless network, and by providing coverage for isolated coverage gaps. For example, if the user equipment (UE) is behind a building, an access point can provide coverage to that UE with the access point being connected wirelessly to the donor cell.
  • Provide indoor coverage, such as with an IAB access point on top of a building that serves users within the building.

5G Americas also said that in practice, IAB is more relevant for mmWave because lower frequency spectrum may be seen as too valuable (and also too slow) to use for backhaul. The backhaul link, where both endpoints of the link are stationary, is especially suitable for the massive beam-forming possible at the higher frequencies.

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3GPP Release 16 status of work items related to IAB:

(Note: Study is 100% complete, but others are 0% or 50% complete):

750047 FS_NR_IAB … Study onNR_IAB 100%
820170 NR_IAB-Core … Core part: NR_IAB 0%
820270 NR_IAB-Performance 850002 … CT aspects of NR_IAB 0%
830021 FS_NR_IAB_Sec … Study on Security for NR_IAB 50%
850020 … Security for NR_IAB 0%
850002 … CT aspects of NR_IAB 0%

References:

https://www.fiercewireless.com/wireless/at-t-expects-to-test-iab-2020-use-it-more-widely-2021

https://www.lightreading.com/mobile/5g/verizon-to-use-integrated-access-backhaul-for-fiber-less-5g/d/d-id/754752

AT&T $3B+ Earnings Miss; Truce with Elliott Management; HBO Max Announcement

Overview:

AT&T earned $3.7 billion on $44.6 billion in revenue for the July-September 2019 (3Q19) period, when Wall Street had expected about $6.8 billion in adjusted profit, $5.3 billion in net earnings and $45 billion in sales. The company added 255,000 wireless customers and now has more than 79 million total phone customers.  AT&T suffered a steep drop at its DirecTV business, losing more than 1.1 million customers, which cut into profits.

In recent years, AT&T has transformed itself from a telecom/network operator into a major media player, selling satellite TV service to millions of people (via its DirecTV acquisition) and owning a large chunk of Hollywood (via its Time Warner acquisition).  That business strategy hasn’t gone over well with investors as AT&T shares have declined over the past several years, despite this year’s gains in a bull market where the S&P 500 is up 21% year to date.

In September 2019, hedge fund Elliott Management asked the company to stop striking new acquisitions, to increase dividends and share buybacks and to improve its efficiency by cutting workers and selling off under-performing divisions like DirecTV. The fund also said it was seeking seats on AT&T’s board. The two sides have been in talks over the last few weeks to broker an agreement.

Yesterday, a truce was reached as AT&T announced changes to its corporate governance and pledged to increase revenue and profit each year for the next three years.

AT&T CEO Randall Stephenson  on the earnings call:

We expect total company revenues over the 3-year period to grow by 1% to 2% per year. This will be driven by strength in Mobility, increased fiber penetration and WarnerMedia.

As mentioned earlier, our wireless business is now enjoying operating leverage from investments made over the last 5 years. Our WarnerMedia cost synergies are on target and EBITDA at AT&T Mexico is ramping, and we’re identifying significant opportunities for margin improvement through ongoing cost evaluation and operational review.

Improving margins 200 basis points will give us an EBITDA margin of 35% in 2022. And applying a 35% margin to a revenue base that’s growing 1% to 2% per year produces an EBITDA lift in the neighborhood of $6 billion in 2022, and that includes our investment in HBO Max.

AT&T’s strategy to bolster profits also includes potential job cuts, which was strongly opposed by a union that represents over 100,000 AT&T workers. The company also said it expected to pay off the debt associated with last year’s $80 billion purchase of Time Warner. It will review its sprawling set of businesses to see what could be sold or split off into a partnership with other companies.

“We commend AT&T for the positive steps announced today, which will create substantial and enduring shareholder value at one of America’s greatest companies,” Elliott Management said in a statement.

Analysis:

The graph below, on the left, clearly shows how postpaid net adds have been struggling for the past five quarters, while churn has risen to new levels.

Although the telecom carrier space is known for being highly competitive, peers Verizon and certainly T-Mobile US have done a much better job than AT&T at growing their mobility user base and keeping churn under control. Postpaid ARPU (a measure of per-unit revenue, see the chart on the right above) continues to improve YOY, which helps to explain better margins, but at a decelerating pace that reached a mere 1% in 3Q19 vs. 4% in 1Q19.

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Premium TV net user loss reached an astonishing 1.2 million in the quarter, representing roughly 5% of total video connections being dropped in only three months. Over-the-top, once considered a glimmer of hope in user base growth, lost nearly 200,000 subscribers. Cord-cutting and increased competition in streaming probably best explain the deterioration.

Analysts say it is hard to be overly excited or optimistic about AT&T’s mobility and entertainment businesses (representing about two-thirds of its revenues). The company seems to be falling behind its peers, losing market share to competitors in both wireless (T-Mobile US and Verizon) and premium TV (cable TV/MSO companies).

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Update on HBO Max:

AT&T’s WarnerMedia said on Tuesday that its HBO Max streaming service will launch in the U.S. in May of 2020, and cost $14.99 a month. At a company event in Burbank, California, WarnerMedia CEO John Stankey said that content, technology platform and marketing and distribution are the “three pillars” for a successful streaming service. He said AT&T is best positioned for all three. The company said it will spend $4 billion over the next three years building HBO Max. It expects annual incremental revenue, from subscriptions, content and ads, to hit $5 billion by 2025, which is the year it should start to positively impact earnings.

HBO Max will start with about 10,000 hours of content, including movies, original content and classic TV shows. That’s “less than some of our competitors,” said Bob Greenblatt, chairman of WarnerMedia Entertainment, at the event.  HBO will launch an advertisement-based HBO Max offering in 2021, less than a year after the ad-free version hits the market. The goal is to reach 75 to 90 million subscribers by 2025, Stankey said.

AT&T said the service would be free for existing HBO customers and the company said it expects to convert the majority of them to HBO Max subscribers over time.

WarnerMedia executives announced that the new streaming service will use “human-powered discovery” in addition to smart analytics to help curate a more ideal user experience for subscribers.  One of the most interesting ways HBO Max is going to differentiate itself from its competitors is by what they’re calling “co-viewing.” Basically, each member of a subscriber’s family will be able to set up their own individual profile, but when they want to watch content together, they can log in simultaneously to a new, separate profile that won’t affect the recommendations for the individual profiles. They can also create shared watch lists.

John Stankey, CEO of WarnerMedia, speaks Tuesday in Burbank, CA during Warner Media Day

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HBO Max is one of the newest additions to an extremely crowded streaming market that will soon include Disney+ and Comcast’s Peacock. They’re all taking aim at NetflixAmazon, Hulu and Apple, which have a variety of subscription and ad-based offerings. AT&T has said HBO Max will become the “workhorse” for its video business as cord-cutting of traditional TV expands.

Drew FitzGerald of the Wall Street Journal had this assessment (excerpts):

HBO Max will have to overcome several hurdles from the start. Netflix is already in 60 million homes in the U.S. and an additional 97.7 million abroad. Also, Apple Inc. and Walt Disney Co. will both launch their video services in November, giving them a head start over AT&T. What’s more, those services will cost less than HBO Max.

There is little room for error for AT&T. The company is already the country’s biggest pay-TV company with more than 21 million DirecTV and fiber-optic subscribers watching its channel bundles. But cord-cutting has ravaged that industry as viewers seek cheaper and more user-friendly entertainment. AT&T has taken the brunt of the damage, with nearly three million customers lost so far this year.

HBO Max is an expensive rescue effort. The company expects to spend $2 billion next year to launch the service and stock it with new entertainment. It will spend $1 billion for each of the following two years until costs begin to subside. That comes on top of more than $1 billion already spent on reruns like “Friends” and “The Big Bang Theory.” The five-year deal for “South Park” streaming rights, which were sought by incumbent rights holder Hulu and Comcast Corp. ’s Peacock, was around $600 million, a person familiar with the matter said.

HBO Max’s debut was delayed by an antitrust fight over AT&T’s takeover of Time Warner. The $80 billion-plus acquisition was AT&T’s biggest-ever deal, making the Dallas company the world’s second-biggest media company practically overnight. But it had to fight a federal lawsuit launched in 2017, delaying its plans by more than a year.

HBO Max won’t replace HBO Now, which will remain a stand-alone service for the foreseeable future. The company isn’t able to do away with traditional HBO packaged with cable subscriptions, either. Adding to the confusion are AT&T TV, AT&T TV Now and AT&T Watch TV, three brands the telephone company uses to market its live channel packages.

“Our future video product set will focus on two platforms: HBO Max, our subscription video on-demand service…and AT&T TV, our live-TV offering,” Mr. Stephens said Monday. He didn’t mention DirecTV, the name most AT&T customers still use today.  “We’ll convert as many as we can as quickly as we can,” Mr. Stephens said, and with all the new content being added, “why wouldn’t they?”

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As an illustration of how competitive streaming TVservices have become, Sony today announced it plans to shut down its PlayStation Vue streaming service early next year due to intensifying competition, as technology and media companies inundate consumers with video options.

The service, which launched in 2015 and lets users stream and record live programming through PlayStation 4 consoles and devices from Roku Inc., Apple Inc. and others, will be discontinued in late January, the company said Tuesday. Going forward, Sony said it would focus on its core gaming business.

“Unfortunately, the highly competitive Pay TV industry, with expensive content and network deals, has been slower to change than we expected,” the company said in a statement.

When PlayStation Vue made its debut, Sony faced minimal competition in providing consumers an opportunity to view live television and cable channels without having a subscription to a cable or satellite TV provider. Sling TV, now part of Dish Network Corp., in January 2015 became the first streaming service with major live networks.

But today there are more than a dozen television-streaming services on the market such as Hulu, YouTube TV, FuboTV and others. More streaming services are also slated to run out in the months to come from the likes of Apple, Walt Disney Co. and AT&T Inc. ’s WarnerMedia. Not all offer live television, but the wider array of services has meant that consumers are faced with more options for online video entertainment than ever before.

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References:

https://seekingalpha.com/article/4299682-t-inc-t-ceo-randall-stephenson-q3-2019-results-earnings-call-transcript?part=single

https://seekingalpha.com/article/4299727-t-delivers-investors-want

https://www.nytimes.com/2019/10/28/business/dealbook/att-earnings-elliott-management.html

https://www.cnbc.com/2019/10/29/warnermedias-hbo-max-will-launch-in-the-us-in-may-of-2020.html

https://www.wsj.com/articles/at-t-steps-into-streaming-wars-with-hbo-max-11572368721 (on line subscription required)

https://www.wsj.com/articles/sony-to-shut-down-playstation-vue-streaming-tv-service-11572377619

AT&T CEO Stephenson: AT&T has fastest wireless network, will have 5G nationwide footprint by mid-year 2020

Speaking at the Goldman Sachs Communacopia conference in New York, AT&T CEO Randall Stephenson said that the company has increased the capacity of its wireless network by 50% such that it is now the fastest and highest quality (presumably in the U.S.)

“Over the course of about 3 years, we are increasing (or have increased?) the entire nationwide capacity of the AT&T wireless network by 50%……What’s the by-product of that? AT&T, end of last year and first half of this year, has just surpassed the competition in terms of wireless network performance. It is unequivocally the fastest wireless network, best quality network. We’ve exceeded the competition and the gap is widening. It’s not getting closer. That’s a beautiful place to be for a company like ours, having a high-quality network claim. And it’s really important when you’re entering a world of distributing premium video to our consumers over wireless networks.”

Stephenson credits AT&T’s FirstNet build for helping with much of the company’s work on 5G:

“You have to go out and you have to climb every cell tower where you’re deploying this (FirstNet) network nationwide. Why is that such a big deal? We have also, over my tenure as CEO, invested well over $40 billion in aggregating a big portfolio of wireless spectrum. And this is really important because we believe when the world of video came, and you’re distributing video over wireless networks, you’re going to need an amazing amount of capacity. So we’ve been accumulating this wireless spectrum, $40 billion plus worth of this. To put that spectrum to work, what do you have to do? You have to go climb every cell tower and put it to work. This is expensive stuff to do across an entire country.”

And “what do you have to do to deploy 5G? You have to go climb every cell tower in the country and put up 5G antennas and the hardware associated with it.” he said.  More specifically, Stephenson stated:

“We will, as a result of all this work that I just talked about, we will have a nationwide 5G footprint by midyear next year, nationwide 5G by midyear next year in the really premium spectrum areas of our network. And so we’re feeling really good about wireless.”

AT&T presently has 21 pre-standard 5G markets up in the U.S. using high band millimeter wave (mmWave) spectrum. Stephenson said that T-Mobile, AT&T and Verizon are all going “aggressively” for 5G markets in the U.S. In fact he considers the US the global leader in 5G.

This author strongly disagrees and believes that almost all of the currently deployed pre-standard 5G networks will have to be replaced in 2021-2023 after IMT 2020 is standardized by the ITU (not 3GPP!).

Stephenson said, “In China, I’m not aware of any 5G systems up and running…In Europe I’m not aware of an RFP [request for proposal] out.”  While it’s true that China is currently in the build-out phase of 5G, it’s a top priority of China’s government to be the world leader as per this recent IEEE Techblog post.

Stephenson also talked up the benefits of 5G (as if there wasn’t enough hype already?). For instance, he says that 5G can handle “millions” of devices on a cell and locate objects to within “centimeters” rather than meters. The networks, he added, will also be “real time” and help with the “virtualization” of functions — an initiative that AT&T has already been pursuing aggressively through various open source projects in the OCP, ONF and Linux Foundation.

“You have to have powerful compute capability for 5G.  All of a sudden, when you have networks this fast, you can begin to push a lot of these requirements, storage into the edge of the network. And so you’re getting cloud distributed (computing) down to the edge of the network. This brings a whole different level of speed, but it also brings a whole different level of imagination in terms of what do form factors start to look like? Millions of devices per square mile literally being located within centimeters of each other with a whole different form factor in terms of power, storage and compute requirements. I mean, truly, the Google vision of a few years ago that everybody laughed about, that this becomes the screen, that’s feasible. That is truly feasible. Sensors that are microscopic because the power requirements are so much lower. And where this allows you to go as a society? I mean traffic management capability because of sensors that are this cheap and broadly distributed, millions per square mile, pipeline management, utility — I can go on and on, autonomous cars.”   Ughhhhh!

Continuing with his 5G cheer leading, Stephenson added:

“When you go to 5G, millions of simultaneous connections are now feasible within a given square mile area on this technology (unlike 4G-LTE). That’s a different business proposition for everybody who sits in this room and all the companies you invest in. So the connectivity goes to a different level. The security, this is the part we love, goes to a different level as well,” he added.

Note — AT&T’s mmWave Spectrum holdings:

AT&T currently uses mmWave spectrum for its 5G+ service.  The company’s 5G spectrum holdings in the millimeter wave band are now more than 630 MHz (as of July 2019 as per this press release).  All of the licenses won in FCC Auction 102 were in the more valuable upper 500 MHz portion of the 24 GHz band, AT&T said.  “We’re leading the nation in mobile 5G deployment and the large, contiguous block of spectrum we won in Auction 102 will be critical to maintaining that leadership,” said Scott Mair, president of AT&T Operations.  For more information, please see this IEEE Techblog post.

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Regarding virtualization of 75% of AT&Ts network (a claim we think is highly exaggerated as per this comment), the AT&T CEO said:

“This virtualization, which we now have 75% of our network virtualized, cloud-based types of architecture, we are now 17 — roughly 17 quarters where the cost of this has been going down year-over-year 7% to 8%, year-over-year for about 17 straight quarters. That’s a stunning development. For a company like ours, to get yourself in a cost position like that to address pricing pressure, competition from the Chinese and so forth, it’s a really powerful thing.”

As for AT&T’s wireless network operator competition, Stephenson said:

“Everybody is in an aggressive build cycle for 5G, so a lot of capital being deployed as well. But do have a new player in the market in the form of DISH with a prepaid business and a lot of fallow spectrum? Does that come into the market? And the AGs have a successful lawsuit and block it? I honestly don’t know how predict it. I do think the next 2 or 3 years doesn’t get radically different. If the Sprint/T-Mobile deal gets done, everybody’s — Sprint, T-Mobile, we know what that play looks like to run integrations of large-scale networks. They have a lot of great opportunity. They’ll have a lot of spectrum to put to work, but it’s a 2- or 3-year integration exercise. DISH will have a rather significant period of time to build out networks. So next 2 or 3 years may be as predicable as they’ve been. As soon as you say that, something will change, but it’s kind of my assessment of it right now.”

“You have T-Mobile, AT&T and Verizon all going aggressively, accumulating the spectrum required to deploy this, getting the spectrum cleared and the right bands to deploy this and working the standards of the technology. And so we have been aggressive. AT&T was hyper-aggressive at working the global standards for 5G so that our network equipment providers can manufacture equipment and get us in the market.”

Question to Ponder?

In conclusion, we ask readers to think if Stephenson’s remarks are truly accurate, especially his claims (echoed by many AT&T executives) that the company has virtualized 75% of its network functions.  That would mean replacing that percentage of network equipment (hardware with embedded proprietary software/firmware) with open source virtualization software and orchestration running in commodity compute servers with white box switches and transport network elements.  Is that true or is it “lies and more lies?”

 

References:

https://investors.att.com/~/media/Files/A/ATT-IR/events-and-presentations/ATT%20Randall%20Stephenson%20at%20Goldman%20Sachs%2091719.pdf

https://www.lightreading.com/mobile/5g/atandt-ceo-us-ahead-in-5g/d/d-id/754180?

Samsung (with AT&T) Tests How 5G Can Improve Chip-Making

By Sara Castellanos of the Wall Street Journal

Samsung Electronics Co. is testing how 5G wireless networks can speed up connections at its chip-making factory in Austin, Texas, a pilot that aims to prove 5G is more than a buzzword. The company is experimenting with the new technology to show what ultra-fast speeds can do at its Austin chip factory

The company has teamed up with AT&T Inc. ’s communications division to develop a customized 5G network to experiment with how it could be used in chip manufacturing.

The fifth generation of cellular networking, 5G is designed to replace current 4G technology, also known as LTE. The ultrafast speeds and reduced lag that will come with 5G will buttress new applications such as augmented reality and self-driving cars. Peak download speeds using 5G are expected to be about 100 times as fast as with 4G.

The transformation that will come from widespread commercial 5G deployments in manufacturing, logistics, transportation and energy is still about a decade away, experts have said. That’s partly because it will take time to roll out the infrastructure to achieve full 5G coverage.

In the meantime, Samsung and other companies are testing 5G’s potential in limited pilots to show what the technology can do.

“We’re still in the experimentation phase, but we’re hopeful there’s value,” said Alok Shah, vice president of networks strategy, business development and marketing at Samsung Electronics America, the company’s U.S. unit.

Factories will be a big beneficiary of 5G connections, said Andre Fuetsch, chief technology officer for AT&T Communications, AT&T’s biggest division.

“We see 5G being a great solution for solving a lot of the Wi-Fi issues that typical factories have today,” he said. The technology, for example, could be used on manufacturing floors to power more reliable connections for computer-vision-scanning equipment that checks product quality.

AT&T has also rolled out consumer 5G networks in about 20 U.S. cities.

Samsung Electronics America and AT&T have invested millions of dollars in 5G innovation at Samsung’s chip-manufacturing facility in Austin. Thousands of employees work at the chip factory, which is the size of about 10 football fields, Mr. Shah said.

Chip-making uses a lot of water and toxic chemicals; 5G could help chip factories cut waste and alert workers to safety hazards.

For example, 5G would allow more sensors to be installed to detect air quality, Mr. Shah said. Streaming real-time data from the sensors over 5G networks would mean that a control center can immediately detect serious air-quality hazards and move people out of harm’s way. Sensors in factories today can’t rely on existing wireless networks to pass along warnings to a control center, Mr. Shah said.

“Being able to put thousands of sensors within a relatively small space is hard for other [networking] technologies to support,” Mr. Shah said. Certain networks can only support a finite number of devices. Fifth-generation wireless networks could support 1 million devices per square kilometer, up from about 100,000 devices per square kilometer with 4G LTE, he said.

Sensors on pumps and valves could also stream data about water usage over 5G networks so the facility can improve the efficiency of its water usage in real time and reduce waste.

Using 5G connections, workers could also learn how to repair equipment on the factory floor through augmented and virtual-reality headsets without any buffering or lags.

Other companies including New York Times Co. and German engineering firm Robert Bosch GmbH are testing 5G in pilots. The market for 5G, including related network infrastructure, is forecast to grow to $26 billion in 2022 from $528 million in 2018, according to research firm International Data Corp.

The tests are often “showcase demonstration pieces,” useful for proving that 5G could generate revenue through new services or make processes more efficient, said Jason Leigh, research manager for mobility and 5G at IDC.

“The sooner you can get something tangible, it makes it easier to have that discussion at a C-suite and board level about what 5G really is, and it’s not just this fad,” Mr. Leigh said.

Write to Sara Castellanos at sara.castellanos@wsj.com

https://www.wsj.com/articles/samsung-tests-how-5g-can-improve-chip-making-11565813658

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Last September, AT&T and Samsung created the US’s first manufacturing-focused 5G “Innovation Zone” in Austin, TX.  The zone, designed to test 5th generation wireless broadband technology, will be on Samsung Austin Semiconductor’s 160-acre campus in north Austin. The site will feature AT&T’s 5G wireless technology along with Samsung’s 5G network equipment, according to an announcement Wednesday from the two companies.

Technology experts say 5G — which is essentially ultra high-speed wireless connections — will not only power future waves of mobile devices, but also will evolve technology in other industries like automotive and health care. Companies expect 5G to be up to 100 times faster than the current 4G networks.

“This collaboration with Samsung Electronics America and AT&T will help us test how a 5G network can improve mobility, performance and efficiencies within our plant,” Sang-Pil Sim, president of Samsung Austin Semiconductor, said in a statement.

South Korea-based Samsung has operated in Austin since 1997. About 3,000 employees work in the 2.45 million-square-foot Austin chip making plant. Samsung has invested $17 billion in its Austin campus through the years.

https://www.dallasnews.com/business/att/2018/09/26/att-teams-samsung-launch-5g-innovation-zone-austin

 

AT&T CFO on network virtualization, FirstNet, 5G in the core network through a software upgrade, and the enterprise 5G opportunity

AT&T Chief Financial Officer John Stephens described to analysts at an Oppenheimer Tech Conference how the company is on track to virtualize its network and will continue to be the “connectors to the cloud.”  The strategic relationship between FirstNet and 5G was highlighted along with a forecast that 5G will bring “pragmatic” and innovative applications to IoT connections. The AT&T CFO noted twoenterprise 5G projects already underway. Stephens cited programs in Austin, Texas, and Chicago, Illinois as well as AT&T’s FirstNet network contract.

Here are a few selected excerpts of Mr. Stephens’ Oppenheimer conference Q & A talk:

First thing, we’re been working on what I call software-ification, although I’m not sure that’s found in Webster’s dictionary. But the taking our network functions and virtualizing them or creating a software-defined network, we’ve been doing that for 5 years. We’re on track to get 75% of our network functions virtualized by the end of next year. We’ve been on this path for a while.

We’ll continue to be the connectors to the cloud, that transport companies to the cloud, not only business from IBM and Microsoft in our partnerships there, but quite frankly in being the go-to-market partners for those companies as they sell their services to other cloud users, to their other customers. So we feel good about that aspect of it, and that’s really important. And that’s a logical evolution of this path that John Donovan and his team have been on for 5 years. And have really — they’ve really done dramatic
things with reducing our cost. So we feel real good about that.

The winning of the FirstNet contract was important to us because it enabled us to do a number of things. We had some AWS-3 and some WCS spectrum that we had, so to speak, in the warehouse that we hadn’t deployed. We had 700 spectrum, Band 14 from FirstNet, which the government was requiring us to deploy. And then we got a whole new set of technologies that were coming out, 256 QAM and 4-way MIMO and carrier aggregation. They were particularly important to us because of our diverse spectrum portfolio. So we got the FirstNet contract and we had to touch a tower, have to go out on the network. And we decided, with this contract, now is the time to, so to speak, do everything. Put all the spectrum in service, that’s the 60 megahertz. In some towers, it’s 50, some towers, it’s 60, but it’s 60 megahertz of new spectrum that was generally unused that we’re putting in.

For LTE, we have about 150 megahertz by the end of this year on average nationwide. And our nearest competitor on sub-6 has about — in-service, has about 2/3 that amount. So we have 50% increase over our competitors. But we — but at the same time, carrier aggregation, 256 QAM, all of these — 4-way MIMO, all these technologies, we’re able to put the capabilities into the network. And phones were coming out, had been out in some cases, and were coming out that had these capabilities. So not only we’re getting more spectrum, but the phones would work better on that spectral highway. That was all being done.

In addition, we made the decision that we’re spending the capital today, and that’s included, it has been in our numbers for a while now, that we’re putting up equipment that’s 5G-enabled. So when the 5G software for the core network (“5G” mobile packet core today is LTE’s EPC) is available, which we had hoped later this year, certainly next year, we will upgrade a significant part, not all, but a significant part of our network, core network, to 5G through a software upgrade. So we may have to go to the tower but we don’t have to climb the tower. We have to touch the computers at the base, but there’s no — we don’t necessarily need a crane and all of that. So it’s a very efficient upgrade.

So when you think about that, it will be a national — a nationwide coverage, 200 million POPS by the middle of the next year. And certainly, we’d hoped to do it faster. But our commitment on the record is by the middle of next year and the first half of next year. We’re at 60% of our FirstNet buildout as of June. We’re shooting to be 70% at the end of the year. That’s our expectations. I will tell you, the network team has surprised me many times before. And over the last few years, it’s always been to the good. They’ve always gotten more done than we expected.

To give you a sense of it, the 60% completion in June is 9 months ahead of schedule for the FirstNet authority. So we’re working very hard to make them proud of us, happy with us, work with us to get this done, so it’s important. And that 60% coverage is a geographic base, so it includes both urban and rural. So if you think about the end of next year or end of this year being close to 70%, and then the mid part of next year having 200 million POPS covered with 5G. Our network, as it raced today, I did a test sitting in this chair last night, got 134 meg speeds on my phone.

Question: When is FirstNet complete in the construction process?

Stephens answer:  Yes, we have a 5-year contract. And so that we would have 3 years after this year to run. But I would be very hopeful we’d keep this 9-month lead and complete it much quicker. We’ll see how that goes. We’ll continue to work with the FirstNet authority on any kind of other additions, activities they want us to have.  But the great part about it is it improves network quality for customers today, for people walking around with regular phones. And that’s what we want to do. We want to take care of that customer base. We hope that reduces churn, increases satisfaction. Quite frankly, it’s going to lower cost because it’s going to make the use of our spectrum more efficient.

Secondly, we’ll go into a new customer base. We don’t serve the FirstNet community in a great way in the sense of we serve them with the highest quality, but we don’t serve them in a lot of numbers today, and we want to grow that. We have over 8,000 governmental departments, municipalities, cities have approved us. And that’s a process that continues on to get official approval. We have 700,000 FirstNet customers. About half of those were our customers before. Now we’re growing much faster, the new customer base. We’re excited about that. The market is 3 million guys who are firefighters, police officers, EMTs. But then there’s another 11 million group that are people who work, power company emergency employees, gas company emergency employees, hospital workers in emergency situations that will qualify. So it’s a huge 14 million human beings. And then you think about it, some are going to have tablets, some of them are going to have body cams, some of them will have drones, they all have husbands or children or families that can join in. So it’s a really great opportunity for us. So there’s that great opportunity, but it’s really great for our core 90 million customers, voice customers that we have today.

Question: When do you upgrade to 5G on the software upgrade?

Stephens answer: I expect 5G in the core would be in service in the middle of next year, in that kind of 200 million POP range. I don’t want to give anybody the impression it’s going to be every home and everyone. But by the same token, it will be dramatic coverage.

Stephens went on to say how the company’s pre-standard 5G network is being used by a hospital system in Chicago (see next paragraph) and by a manufacturer in Austin. He said initial applications will be very “pragmatic” and focused on process automation and the internet of things. The next step, he said, is matching technical service capabilities with applications as businesses explore, “How can we do this differently, how can we apply this more efficiently?”

In Chicago, AT&T is working with Rush University Medical Center and the Rush System for Health to explore how 5G and multi-access edge computing can benefit healthcare with a focus on streamlining internal data handling while improving patient experience. In Austin, AT&T is working with Samsung to test 5G for manufacturing in the company’s semiconductor fabrication facility. Applications are focused on improved “efficiency, safety, security and operational performance within the manufacturing industry,” according to AT&T.

Stephens said winning the FirstNet contract provided the opportunity “to do everything.” That includes deploying FirstNet’s 700 MHz spectrum while simultaneously putting AWS 3 and WCS spectrum into service, rolling out gigabit LTE features like 4X4 MIMO, 256 QAM and carrier aggregation and installing 5G-ready equipment.

Asked by Oppenheimer & Co.’s Tim Horan what the potential merger of Sprint and T-Mobile US means for AT&T, Stephens said, despite a consent decree from the U.S. Department of Justice, the deal still isn’t done. At a high-level, “Mergers are really hard. You’ve got to bring together two different cultures, two different customer bases. All of that is just hard to do and it’s expensive. So we’ll see what happens.”

Summing up, Stephens said: “For all the things I said about our wireless business, we’re ready to compete. It’s a competitive market today; it’ll be a competitive market tomorrow. We feel good about the ability to compete going forward.”

And what about growing AT&T’s total business in the next 4 years or 5 years?

Let me say it this way. We’re not making predictions about future years, but we do — we’re spending. We’re investing a lot of money in content, we’re investing a lot of money in capital. And that capital is — we’re getting a lot of this network rebuild. And as — and we’re investing in, like for example 5G, we’re investing in the equipment, the hard assets today. So we turn that up next year, and a lot of that will be software, so our capital intensity can go down. With that capital intensity going down, then you can see reasons for good support for great cash flows. And so we feel good about our cash flow position this year and we’re optimistic about where the business is going with regard to the ability to generate cash.

 

https://investors.att.com/~/media/Files/A/ATT-IR/events-and-presentations/ATT%20John%20Stephens%20at%20Oppenheimer%20Conference%20%20August%206%202019.pdf

AT&T tests “5G” transmission on mid band (sub 6GHz) and later low band (700MHz) spectrum

AT&T plans to test “5G” transmission  equipment in the 4400 MHz to 5000 MHz band in Austin, Texas, having received an experimental license from the FCC.

The 4400MHz to 5000MHz band is known as the n79 band in 3GPP Release 15 “5G New Radio (NR)” specification [1.]. It is also part of the C-Band in the US.

Note 1.  3GPP completed Release 15 “5G NR” specifications in June 2018. Together with 3GPP final NR specifications in Release 16, they will be submitted for consideration as an IMT 2020 Radio Interface Technology (RIT) at a future ITU-R WP5D meeting.  Release 16 is now scheduled for completion during the first half of 2020.  It will (hopefully) specify ultra low latency, ultra high reliability operation in the data plane- an important use case for 5G/ IMT 2020.

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AT&T is running mobile tests between the beginning of June and the beginning of September this year.  AT&T says that those tests will operate “within 20 meters radius of base.”

“AT&T seeks to further validate system design and operation in the sub-6 GHz band for certain applications and use cases such as IAB (Integrated Access and Backhaul), LNC (LTE-NR Coexistence), V2X (Vehicle to vehicle/others), URLLC (Ultra-Reliable Low Latency Communication), mMTC (massive Machine Type Communications), and eMBB (enhanced Mobile BroadBand),” wrote AT&T’s David Wolter in the company’s application for the FCC license.

“We wouldn’t be able to share info beyond that in the license app,” an AT&T spokeswoman told Light Reading.

AT&T is scheduled to start its rollout of 5G on low-band spectrum next year, probably on the 700MHz band.

This week, the company announced a successful sub-6GHz spectrum transmission field test in in Plano, TX. However, the actual frequencies used were not disclosed.

After making our first data transfer over Sub-6GHz spectrum in the field this week, AT&T is a step closer to introducing 5G over sub-6 spectrum, with plans to offer nationwide 5G in the first half of 2020.  This milestone connection was made in Plano, Texas using a Qualcomm Technologies smartphone form factor test device powered by a Qualcomm® Snapdragon™ 5G modem, RF transceiver and RF Front-End (RFFE) solution. Moving this connectivity from the Lab to the field marks significant progress toward our plans to offer 5G to customers across the country. We also remain on track to offer our first smartphone capable of accessing 5G over low-band spectrum as early as this year.

The mega telco and media giant is currently running some of its 5G networks in 21 cities on its 39GHz millimeter wave system for businesses and selected developers. Compared with low-band, these millimeter wave networks offer blazing speeds (1 Gbit/s), but much lower coverage ranges (1,000 to 2,000 feet).  Hence, they will require many more small cells for any given geographical area.

AT&T plans to offer nationwide 5G running on low-band spectrum in the first half of 2020. The operator is expected to use 700MHz spectrum, alongside its FirstNet 4G 700MHz deployment, but could rely on other frequencies as well. AT&T has also been involved in discussions about using the C-Band, largely in the 3.7GHz to 4.2GHz ranges, for 5G.

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Addendum: Frequency Bands for IMT 2020

The actual frequencies to be used for IMT 2020 radio aspects (ITU-R WP5D) will be determined at WRC-19 in Egypt this fall.  Those will then be listed in a REVISION OF ITU-R Recommendation
M.1036-5:  Frequency arrangements for implementation of the terrestrial component of International Mobile Telecommunications (IMT) in the bands identified for IMT in the Radio Regulations (RR). 
While nothing has been decided yet, ITU-R has proposed some high band frequencies as per  https://www.itu.int/en/ITU-R/Documents/ITU-R-FAQ-IMT.pdf
  19. Question: What frequency bands are under study for the implementation of IMT2020 (5G) RIT/SRITs? 
The following (high) bands, which are already allocated to mobile, will be studied with a view to an IMT-2020 (5G) identification: • 24.25 – 27.5 GHz • 37 – 40.5 GHz • 42.5 – 43.5 GHz • 45.5 – 47 GHz • 47.2 – 50.2 GHz • 50.4 – 52.6 GHz • 66 – 76 GHz • 81 – 86 GHz The following bands will also be studied, although they are not currently globally allocated to the mobile service: • 31.8 – 33.4 GHz • 40.5 – 42.5 GHz  • 47 – 47.2 GHz
 
The results of the studies will be submitted for decision to the next World Radio Conference (WRC-19), to be held from 28 October to 22 November 2019 in Sharm el-Sheikh, Egypt.  
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References:

U.S. DoJ in ~$1B Telecom Services Deal With AT&T

Task Order valued at $984 [1.] million over 15 years to help improve mission performance

Note 1.  The total value of the Task Order is estimated at $984 million over 15 years if all options are exercised.

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AT&T is doing great in the public sector.   FirstNet has received many accolades and is world class.  On Monday, July 29th, the telecom and media giant announced the $984 million DoJ award  as part of the General Services Administration’s $50 billion Enterprise Infrastructure Solutions (EIS), contract.

EIS is set to replace the current governmentwide telecom contract vehicles Networx and WITS-3, both of which will expire within the next three years. Agencies are expected to use that transition as an opportunity to fully modernize their communications infrastructure.

The Justice Department (DoJ) is the third U.S. federal agency to select a company to help modernize all its telecommunications services.

“Through this award, the DoJ will transition to a next-generation communications platform supporting more than 120,000 employees across more than 2,100 locations,” AT&T said in a press release. That work will include incorporating IP voice and other modern communications tools, as well as data and cloud security and other professional services.

“The AT&T solution will provide DoJ the flexibility and protections to meet their requirements as they aim to strike the right balance between needs to access cloud services from multiple providers and ensuring the access is highly secure,” the release states.

“The DOJ and its component organizations do the hard work of protecting the freedoms, rights and safety of all Americans,” said Stacy Schwartz, vice president, AT&T – Public Safety and FirstNet. “We are honored to provide a modern communications platform and capabilities to support the DOJ’s work for the next 15 years.”

The contract covers the entirety of the Justice Department, including 43 component offices and programs; the enterprise wide Joint Cloud Optimized Trusted Internet Connection Service, or JCOTS; and the law enforcement special communications network FirstNet.

The enterprise contract will be the only EIS award to come out of the Justice Department, the agency told Nextgov, though the FBI will be reissuing its separate solicitation “at a later date.”

AT&T is one of three vendors to complete the security review required before beginning work on an EIS contract, along with Verizon and CenturyLink. Six smaller vendors—BT Federal, CoreTech, Granite, Harris, MetTel and MicroTech—have yet to finish their security authorization work with GSA.

Two other agencies have made their EIS awards this summer: the Railroad Retirement Board, which also went with AT&T, and half of NASA’s requirement under a $10.5 million deal with CenturyLink.

Additionally, the DOJ solution includes access to the AT&T mobility network and FirstNet, the nationwide, dedicated communications platform purpose-built for public safety. FirstNet brings public safety a physically separate core network for enhanced security, priority and preemption, no speed limitations anywhere in the country, and Band 14 spectrum for their dedicated use. These services and AT&T’s global network offer DOJ and its component organizations access to highly secure and reliable connectivity, as well as vital communications capabilities when and where they are needed.

To learn more about AT&T Public Sector, go here.

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References:

https://about.att.com/story/2019/department_of_justice.html

https://www.nextgov.com/it-modernization/2019/07/justice-signs-nearly-1b-telecom-services-deal-t/158780/

 

Comcast earnings beat with strong broadband subscriber growth; AT&T is still largest U.S. pay TV provider but bleeds video subs

Despite much higher video subscriber losses than in the past, Comcast generated healthy revenue and profit margin increases in Q2-2019, based on the strength of its performance in the broadband, wireless, business services and other sectors.   Comcast, the largest cable and broadband provider in the U.S., reported steady revenue and subscriber gains nearly across the board on July 25th, with the glaring exception of its slumping Xfinity pay-TV business.  It also racked up revenue gains in its NBC Universal cable networks, broadcast TV and theme park units, as well as customer revenue gains at its new Sky operation in Europe.

On the pay-TV side, Comcast suffered less collateral damage than most of its peers (e.g. AT&T Direct TV and Direct TV now bled subscribers in the most recent quarter – see Editor’s Note below).  The cableco/MSO saw its video subscriber losses increase in the second quarter as cord-cutting by consumers accelerated. The company shed 224,000 video subs (209,000 residential and 15,000 business subs) during the quarter, far worse than its loss of 140,000 subs a year earlier. That reduced its total video base to 21.64 million, maintaining its status as the nation’s second-largest pay-TV provider behind AT&T.  Despite these much heftier sub losses, Comcast’s video revenues declined just 0.6% on a year-over-year basis to $5.59 million, thanks to price hikes and subscriber tier upgrades. More importantly from the company’s perspective, video ARPU increased by 1.3%, as the operator, like a growing number of its peers, continues to shift its focus from low-margin to high-margin customers.

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Editor’s Note: The second quarter is typically the worst of the year for pay-TV providers. For example, AT&T lost 778,000 premium TV subscribers in the second quarter, including DirecTV satellite and U-verse television customers – a sharp acceleration in subscriber losses from the 544,000 that cut the cord in Q1-2019.  The total number of premium TV video connections fell to 22.9 million, its lowest total since June 30, 2017, when it stood at almost 25.2 million, an overall net loss of 2.3 million.

AT&T also lost 168,000 streaming DirecTV Now accounts and AT&T said it expects a similar level of video losses to continue in the current quarter. It’s somewhat surprising that AT&Ts video streaming offering is seeing a mass exodus with the number of subscribers peaking at 1.858 million in September 2018 to 1.34 million now, a decline of more than 500,000.

 

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Comcast is by far the largest broadband provider in the U.S.  (that’s right- ahead of AT&T, Verizon and CenturyLink).  The cableco/MSO added 209,000 new broadband Internet subscribers (182,000 residential and 28,000 business) in the spring quarter, boosting its total broadband base to 27.8 million at the end of June. While that’s down markedly from its gain of 260,000 broadband subs a year earlier, the year-ago total marked the company’s best-ever broadband quarter. Comcast executives stressed that they’re well on their way to their 14th consecutive year of 1 million-plus broadband subscriber increases.

Broadband revenues surged 9.4% to $4.66 billion in the 2nd quarter, due to the impressive increase in broadband subscribers. Residential broadband ARPU (average revue per unit) rose by 4.2% year-over-year, as fewer bundling discounts and subscriber upgrades to higher-priced speed tiers lifted revenues even without price hikes.

“The ARPU is growing, broadband revenue is growing, and it’s margin accretive, so it’s helping the EBITDA growth,” said Comcast Cable President and CEO Dave Watson, in the cableco/MSO’s Q2 earnings call. “So overall, I think we have a solid pipeline for broadband innovation.”

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On the wireless front, Comcast’s Xfinity Mobile service continued its steady, if slightly slower, ascent to profitability. The MSO added 181,000 mobile lines in Q2, raising its total to nearly 1.6 million lines. The strong mobile line gains were off from adds of 204,000 lines in the year-ago period but up from adds of 170,000 lines in Q1.

As a result, Comcast’s mobile revenues rose 21.0%, to $244 million. Operating cash flow from Comcast’s mobile business improved as well to $88 million, down substantially from a year earlier, as the new unit edges ever closer to profitability.

Speaking on the company’s earnings call Thursday morning July 25th, Comcast Senior EVP and CFO Mike Cavanagh said Xfinity Mobile is “already positively impacting [customer] retention and attracting new customers” to the company’s cable offerings. He predicted that the mobile unit will start producing positive economic results when penetration rates reach “the mid-to-high single digits.”

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Similar to other large North American pay-TV providers that have reported Q2 earnings so far.  “We’ll continue to emphasize our approach to this segment,” said Comcast Cable President and CEO Dave Watson. “We’re not going to chase the low end.”

Comcast officials still had no early results to share about Xfinity Flex, a new video streaming product for broadband-only customers that’s powered by the MSO’s cloud-based X1 platform (including the X1 voice-based navigation and search system) and integrated with OTT offerings like Netflix, Amazon Prime Video and YouTube. But executives said more information will come soon.

“It’s an important long-term product,” Watson said Flex on the company’s Q1 earnings call in April, noting it’s early use in a “targeted fashion” to build a broader video relationship with the operator’s broadband-only subs. “We think Internet-delivered video is a good thing for the cable business.”

Also on the streaming video front, Comcast executives revealed a bit more about the forthcoming OTT-delivered video service from the conglomerate’s NBCUniveral (NBCU) unit. Plans call for the OTTP offering, to be based on the existing Now TV platform of Comcast’s Sky service in Europe, to launch in April.

The new ad-supported service mainly will feature acquired movies and TV shows, rather than exclusive originals, at least at first, said NBCU CEO Steve Burke. Despite a market crowded with incumbents like Netflix and Amazon, as well as such new entrants as Disney, WarnerMedia and Apple, Burke is not worried, he said, in a statement.

“Our service is very different from Netflix,” said Burke. “We believe we’ve got some ideas that are innovative and don’t really want to share those until we get right close to launch, but we’re very pleased to have The Office and very optimistic about our streaming plans at this point.”

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In a fresh research note issued after the earnings call this morning, Craig Moffett, a principal analyst at MoffettNathanson, gave an approving nod to this strategy:

“As cable operators stop chasing low-value video subscribers, their margins will rise with mix shift, their margins will improve further with improvement in video economics on those that remain; their margins will expand still further as broadband ARPU accelerates (fewer bundled discounts), and their margins will expand still further as their non-programming costs fall as a percentage of revenue.  Almost predictably, Comcast raised its cable margin 2019 guidance yet again (now to ‘over’ 100 bps for the year, from previously ‘up to’).”

Comcast Business kept up its steady growth pace of the past decade and a half. With close to 2.4 million commercial “customer relationships,” the cableco boosted its business service take to $1.93 billion in the second quarter, up 9.8% from a year ago. As a result, the company is now on target to approach the $8 billion mark in annual business revenues this year.

References:

https://www.lightreading.com/services/broadband-services/comcast-broadband-mobile-growth-engines-keep-purring/d/d-id/753019?

http://www.broadbandworldnews.com/author.asp?section_id=472&doc_id=753022&

https://www.cnbc.com/2019/07/25/comcast-q2-2019-earnings.html

https://www.cmcsa.com/financials/earnings

https://seekingalpha.com/article/4277488-t-mass-exodus-continues

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