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.

…………………………………………………………………………………………………………………………………………………………………………………………………………..

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

…………………………………………………………………………………………………………………………….

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.

…………………………………………………………………………………………………

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.

………………………………………………………………………………………………………

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.  
……………………………………………………………………………………………….
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.

…………………………………………………………………………….

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.

…………………………………………………………………………………………….

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.

…………………………………………………………………………………………………………………………………………………………………………………………………………..

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.

 

…………………………………………………………………………………………………………………………………………………………………………………………….

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.”

…………………………………………………………………………………………………………………………………………………………………………….

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.”

…………………………………………………………………………………………………………………………………………………………………………..

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.”

…………………………………………………………………………………………………………………………………………………………………………..

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

AT&T announces cloud partnership with Microsoft 1 day after similar deal with IBM

AT&T has entered into a multi-year, cloud-based collaborative effort with Microsoft the day after announcing an alliance with IBM [1] that also focused on  cloud computing. The teleco and media giant will move many of its non-network apps to Microsoft Azure and use the company’s 365 software suite while Microsoft will deploy new AT&T technologies, such as 5G, to build edge computing applications.

Comment: This is yet another proof point that telco cloud computing has been a dismal failure.  AT&T and Verizon have both sold off many of their data centers and given up on cloud computing/storage in favor of the much bigger players (e.g. Amazon, Microsoft, Google and IBM in the U.S.). This new agreement appears to be a big win for Microsoft Azure, and probably at the expense of Amazon AWS, Google and IBM cloud rivals.

…………………………………………………………………………………………………………………………………………………………………………………………………….

“AT&T and Microsoft are among the most committed companies to fostering technology that serves people,” said John Donovan, CEO of AT&T Communications in a prepared statement. “By working together on common efforts around 5G, the cloud, and AI, we will accelerate the speed of innovation and impact for our customers and our communities,” he added (John is NEVER at a loss for words!)

Microsoft.jpg

Microsoft CEO Satya Nadella with AT&T Communications CEO John Donovan

…………………………………………………………………………………………………………………………………………………………………………………………………….

Observation:

The AT&T Microsoft partnership appears to be broader than the just announced AT&T IBM deal (see note 1 below). That deal is cloud-focused as well but is limited to the AT&T Business Solutions business unit, helping to better manage internal applications. A key objective of the IBM deal is to provide tools for AT&T Business solutions to better serve enterprise customers.

…………………………………………………………………………………………………………………………………………………………………………………………………….

AT&T partnerships on edge computing:

AT&T and Microsoft had earlier announced a deal on mobile edge computing which we reported here.  Earlier this year, AT&T said it will work with Hewlett Packard Enterprise (HPE) to help businesses harness powerful edge capabilities. The two companies have agreed to a go-to-market program to accelerate business adoption of edge connections and edge computing.

…………………………………………………………………………………………………………………………………………………………………………………………….

Note 1.  AT&T – IBM Cloud Parthership:

AT&T Communications will work with IBM to modernize AT&T Business Solutions’ internal software applications, enabling migrations to the IBM Cloud.  IBM will provide infrastructure to support AT&T Business’s applications. AT&T Business will use the Red Hat open source platform to manage workloads and applications.  IBM will be the primary developer and cloud provider for AT&T Business’s operational applications and will help manage the AT&T Communications IT infrastructure, on and off-premises and across different clouds –private and public.

As part of the agreement, AT&T Business will be IBM’s primary provider of software defined networking and will leverage the carrier’s latest technologies including 5G, Edge Compute, and IoT as well as multi-cloud capabilities using Red Hat.

Additionally, the two companies will work together on edge computing platforms, which will help enterprise clients capitalize on the power of 5G network speeds and the internet-connected devices and sensors at the edge of the network.

“In AT&T Business, we’re constantly evolving to better serve business customers around the globe by securely connecting them to the digital capabilities they need,” said Thaddeus Arroyo, CEO of AT&T Business, in a prepared statement. “This includes optimizing our core operations and modernizing our internal business applications to accelerate innovation. Through our collaboration with IBM, we’re adopting open, flexible, cloud technologies, that will ultimately help accelerate our business leadership.”

References:

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

AT&T Taps Microsoft for Broad Strategic Cloud Partnership

AT&T tests 5G and network edge computing with Microsoft Azure; Partners with Vodafone Business for IoT

https://www.business.att.com/products/multi-access-edge-computing.html

AT&T owns >630 MHz nationwide of mmWave spectrum + HPE partnership for Edge Networking & Computing

 

AT&T FlexWare and Cybersecurity power Exide’s Digital Transformation

AT&T is powering Exide’s digital transformation with its FlexWare network virtualization solution.  AT&T FlexWare is one of AT&T’s core software-centric services from the company’s “edge solutions portfolio.” AT&T says its near real-time service cuts long set up times and complex processes.

FlexWare enables businesses to launch virtual network functions (VNFs) to improve productivity and communication across its geographically dispersed physical sites. With FlexWare, AT&T can move the VNFs, such as firewall or security VNFs, to devices on a company’s network.

“Our technology will give Exide the support it needs to continue operating at high standards and to prepare for new opportunities in a 5G world,” said John Vladimir Slamecka, AT&T Region President for Europe, the Middle East and Africa. “We’re building a platform that is ready for new data hungry apps made possible with the arrival of 5G; such as AR and VR. That’s why we are moving compute resources closer to the network edge, opening the door to new experiences and opportunities.”

AT&T’s FlexWare, for virtualized network edge services, is now in place across Exide’s global locations, including throughout Europe, North America and Asia Pacific.  FlexWare at the edge allows Exide to use both highly secure MPLS and internet access services for its network needs. Starting with network routing, Exide is able to access all wide area network components utilizing high bandwidth capabilities to help provide greater flexibility as the needs of each change over time. AT&T FlexWare also allows Exide to fulfill its centralized IT requests without needing local site support.

……………………………………………………………………………………………………….

Exide is a battery and energy storage company which was founded 130 years ago.  It manufactures and recycles batteries for a broad range of industrial and transportation applications including cars, boats, forklifts and uninterrupted power units.  The company has more than 10,000 employees located across 80 countries.

“Our global presence in today’s fast paced technology environment presents the unique challenge of blending reliable legacy platforms with emerging digital solutions.  This requires a data transport infrastructure that supports a broad number of traditional and disruptive applications,” said Brian Woodworth, Exide Chief Information Officer. “AT&T is leading the way as a trusted and visionary provider of network edge solutions, so naturally we turned to AT&T to collaborate with us on our digital journey to become the preferred supplier to our customers across the globe,” he added.

Exide is also using managed network security services from AT&T Cybersecurity.   From an AT&T report on this vital topic:

The security landscape is growing increasingly treacherous as hackers of every type continue to evolve their attack strategies to evade detection while maximizing profit from their time and effort. It doesn’t matter if it’s an organized criminal gang looking to make money from ransomware schemes, covert state-sponsored groups attempting to steal data and disrupt operations, or just malevolent individuals trying to impress others in the hacker community—every bad actor is smarter than they were last year, and better equipped to wreak havoc.

However, we wonder if AT&T takes cybersecurity seriously for its own customers, like this author who has experienced two AT&T account unexplained security breaches in the last few months?

…………………………………………………………………………………………………………………..

AT&T says it is “offering customers like Exide unrivaled visibility and security through people, process and technology allowing them to better protect their global business.”  This author certainly hopes that happens!

…………………………………………………………………………………………………………

References:

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

For more information about AT&T FlexWare (nice video):  https://www.business.att.com/solutions/Service/network-services/sdn-nfv/virtual-network-functions/

For more information about AT&T Cybersecurity: https://att.com/security

https://www.business.att.com/learn/cybersecurity-report-volume-8-5.html

AT&T owns >630 MHz nationwide of mmWave spectrum + HPE partnership for Edge Networking & Computing

Following the close of FCC Auction 102, AT&T won 24 GHz spectrum in 383 Partial Economic Areas (PEAs) for a nationwide average of 254 MHz. All of the licenses won were in the more valuable upper 500 MHz portion of the 24 GHz band, giving AT&T stronger nationwide coverage and additional spectrum depth and capacity in many top markets where demand is often greatest. In the top 10 markets alone, AT&T won nearly 286 MHz on average, including 300 MHz in 8 of those markets.

“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. “We’ve already been recognized for having the nation’s fastest1 and best2wireless network, and by further strengthening our spectrum position, we intend to build on our success. I’d like to congratulate and thank the FCC on the conclusion of another successful auction.”

The licenses it won cover all top 50 PEAs and 99 of the top 100 PEAs.  When added to the mmWave spectrum AT&T already holds in the 39 GHz band, AT&T’s average spectrum depth in mmWave increased by two-thirds to more than 630 MHz nationwide.

AT&T will use the spectrum to bolster its mobile 5G strategy. AT&T was the first U.S. wireless carrier to introduce mobile 5G service. The company’s 5G service is currently available in parts of 19 cities – more than any other wireless carrier – with plans to reach parts of 29 cities by the end of 2019. In the first half of 2020, the company expects to have the best combination of mobile 5G, providing high speeds and low latency service over mmWave spectrum and nationwide 5G service over “sub-6” spectrum.

The company spent about $980 million to win an average of 254 MHz of 24 GHz spectrum in 383 out of about 400 total partial economic areas (PEAs) nationwide. The winnings supplement the company’s previous millimeter wave spectrum holdings in the 39 GHz band.

The key appeal of millimeter wave spectrum is that large swaths of it are available, enabling the spectrum to support the highest speeds – although service deployed in the millimeter wave band has less range than service deployed in lower-frequency bands. AT&T’s initial 5G deployments have been in the millimeter wave band, but the company eventually expects to use a combination of millimeter wave and lower frequency spectrum to support 5G.

The average 630 MHz of millimeter wave spectrum that AT&T now holds in key markets would appear to position the company well to support high speeds, as the company previously achieved speeds of 1.2 Gbps in trials using a 400 MHz channel over a distance of 150 meters.

The company also has said that it has seen speeds as high as 400 Mbps on its commercial 5G network, although it cautioned that average speeds are lower.

AT&T also noted in a press release that the licenses it won in the 24 GHz band were in the “valuable” upper 500 MHz of the 24 GHz band and that the licenses cover all top 50 PEAs and 99 of the top 100 PEAs.

Late last year, AT&T was the first U.S. carrier to launch mobile 5G service, although the company did not have a smartphone available for use with the network until last week.  Customers initially used 5G-capable Wi-Fi hotspots that work with virtually any smartphone to access the network, which now covers parts of 19 cities.  AT&T plans to expand to parts of 10 more cities by the end of 2019 and to launch nationwide service in the first half of 2020.

The company’s initial target for 5G service is business customers – a decision that enabled the company to plan its initial 5G millimeter wave deployments for areas in which key business customers were located. The company also has said that it hopes to command a premium for 5G service in comparison with what it charges for earlier-generation services – a strategy that U.S. wireless carriers have not used previously.

References:

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

https://www.telecompetitor.com/att-average-5g-mmwave-spectrum-holdings-reaches-630-mhz-nationwide-potentially-supporting-gig-plus-speeds/

………………………………………………………………………………………………………………………………..

Separately, AT&T said it will work with Hewlett Packard Enterprise (HPE) to help businesses harness powerful edge capabilities. The two companies have agreed to a go-to-market program to accelerate business adoption of edge connections and edge computing.

Edge computing marks a giant leap forward in providing faster processing and potentially enhanced security for business applications. AT&T Multi-access Edge Compute (MEC) Services enable businesses to take advantage of AT&T cellular coverage – including 5G as it becomes available – as well as new capabilities to manage cellular traffic through virtual network functions. HPE Edgeline Converged Edge Systems help create use cases where applications can reside on premises for lower latency processing.

“AT&T’s software-defined network, including our 5G network, combined with HPE’s intelligent edge infrastructure can give businesses a flexible tool to better analyze data and process low-latency, high-bandwidth applications,” said Mo Katibeh, Chief Marketing Officer, AT&T Business. “Bringing compute power closer to our network helps businesses push the boundaries of what is possible and create innovative new solutions.”

Enabling edge computing is a core tenet in AT&T’s strategy to help businesses get the most out of 5G. This is an important step in bringing these technologies to scale, so businesses can continue to transform how they will use networks in the 5G era.

“HPE believes that the enterprise of the future will need to be edge-centric, cloud-enabled and data-driven to turn all of its data into action and value,” said Jim Jackson, Chief Marketing Officer, HPE. “Our go-to-market alliance with AT&T, using HPE Edgeline Converged Edge Systems, will help deliver AT&T MEC services at scale to help our customers more quickly convert data into actionable intelligence, enabling unique digital experiences and smarter operations.”

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

 

AT&T to Focus new WarnerMedia Innovation Lab on 5G Experiences

AT&T’s WarnerMedia Innovation Lab in New York City will serve as a testing ground for leveraging 5G to provide innovative storytelling through advertising, according to company executives. The 20,000 square foot lab is being built in the Chelsea neighborhood of Manhattan (this author’s home town) and is scheduled to open in early 2020. The WarnerMedia lab will also draw consumer insights and technology from AT&T’s Xandr ad sales unit.

“By working across AT&T, we’re able to combine the latest in 5G technology with immersive content experiences and cutting-edge advertising capabilities,” said David Christopher, president of AT&T Mobility and Entertainment. “The WarnerMedia Innovation Lab will be a space where developers, creators and visitors will be inspired to push the boundaries of entertainment, all powered by the company that first introduced the U.S. to the power of mobile 5G.”

“Storytelling is in our company’s DNA and part of that experience is how the content is enjoyed, including advertising. The Lab is a critical part of our testing and learning on the new experiences in advertising that we will be rolling out to market,” said Dan Reiss, head of advanced advertising and branded content at WarnerMedia Ad Sales.

“The Lab is more than a technology incubator, but also a dream factory for us to create the wonderment that fans have come to love and expect from WarnerMedia,” said Jesse Redniss, GM for WarnerMedia Innovation Lab, in a statement. He described the location as a place where WarnerMedia will “flex the best of [its] creative storytelling capabilities combined with cutting edge technology from AT&T and our partners to deliver experiences that will be talked about for a lifetime.”

“Every day, Xandr looks for new innovative ways to help marketers and create a better viewing experience for consumers,” said Kirk McDonald, CMO, Xandr. “Working with our colleagues at AT&T Communications and WarnerMedia, we are uniquely positioned to develop new advertising innovations that engage consumers and provide integral feedback for marketers and brands. The WarnerMedia Innovation Lab will accelerate the adoption of new advertising formats and provide an environment to showcase our collaborative work.”

Image Courtesy of WarnerMedia

………………………………………………………………………………………………………………………………………………………………………………………………..

AT&T stated the new lab will be “[unveiling] a new balance in the relationship between advertising, technology and content” and said that its work would include mixed reality and/or virtual reality applications, “5G uses that enhance new advertising capabilities,” and better user experiences related to advertising.

Architectural firm Design Republic will head the design of the project, with work beginning this summer with completion scheduled for early 2020.

 

References:

https://www.broadcastingcable.com/news/at-t-focuses-innovation-lab-on-5g-experiences

https://www.rcrwireless.com/20190617/5g/warnermedia-lab-to-be-outfitted-with-att-5g

https://www.fiercevideo.com/tech/at-t-details-new-5g-equipped-warnermedia-innovation-lab

https://www.cordcuttersnews.com/atts-new-warnermedia-streaming-service-could-be-a-great-cord-cutting-tool/

https://about.att.com/story/2019/creating_5g_today.html

Recent Posts