AT&T's recently announced DSL expansion
may not be all it was cracked up to be after closer examination. AT&T announced in a press release on November 7 that they'd be expanding their U-Verse coverage total from 24.5 million homes to 33 million, suggesting an additional 8.5 million new users. But longtime telecom industry analyst Dave Burstein says those numbers aren't at all accurate
, and that AT&T will also be turning DSL off to far more users than they originally suggested. Worse, it looks like AT&T magically shaved some numbers off their existing U-Verse footprint just to make the expansion plan seem larger:
AT&T does not intend to “offer its U-verse TV, Internet and Voice over IP plans in 8.5 million additional customer locations” for a total of 33.5M. Don’t blame the reporters; the press release suggested that interpretation. AT&T again and again has said U-Verse had reached 30M homes. That includes in financial reports, where companies can be penalized for material inaccuracies. In addition, AT&T has always planned to go to ~33.5M in the near future. The current build contains many irregular, irrational holes like much of San Francisco and Indianapolis. They’d be stupid not to fill them in, and John Stankey isn’t stupid.
AT&T found some way to characterize 6M homes they’ve been reporting as served as now unable to get service. One or the other figure is wrong. It may be that the new figure of 24M currently reached was achieved by subtracting 6M current homes they need to bond a second line (already in place) for best TV coverage. AT&T has said they are doing bonding since at least 2009 for those U-Verse homes, but I haven’t seen orders for that many bonded modems hit the supply chain. In either case, the pr is misleading. Some (possibly very low) percentage may get vectored lines capable of “up to 75 megabits” rather than the current 25-40 megabits.
In other words, AT&T is actually only upgrading another 3 or so million users they already planned to finish upgrading, most of them solely in Indianapolis and San Francisco -- where AT&T has run into regulatory problems due to large utility box placement
. That total runs more in line with what we were seeing leaked to analysts before AT&T's announcement
in the hopes of calming network investment-loathing investors.
AT&T found some way to characterize 6M homes they’ve been reporting as served as now unable to get service.
AT&T needed some way to overshadow the fact that they're literally hanging up on tens of millions of DSL users they don't want to upgrade, so they appear to have artificially bloated their network expansion numbers to make things look rosier. The real story continues to be AT&T's plans to dismantle DSL and POTs service across half of their geographic territory
While the migration to LTE makes sense in many instances, the problem arises when you consider the countless billions in subsidies paid AT&T to get those lines up and running in the first place. AT&T plans to gut regulations across the country over the next five years, sever the phone and DSL lines to tens of millions of users (many of them elderly and rural), then hope LTE coverage reaches those areas. Many of these users may struggle to get strong LTE signal, and users shoveled from DSL to LTE will pay significantly
higher prices (like $15 per gigabyte overages).