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Why AT&T's Promise To Bring 1 Gbps to Austin is Mostly Empty
Company Tries Damage Control With Carefully-Worded Press Release
by Karl Bode 03:57PM Tuesday Apr 09 2013
In the apparent hopes of reducing the PR impact of today's Google Fiber in Austin announcement, AT&T has decided their best tactic is to play a little make believe. In traditional AT&T fashion, a company press release picks its words very carefully, insisting that AT&T is "prepared" to offer "an advanced fiber optic infrastructure" capable of 1 Gbps, which is like totally the same thing as offering 1 Gbps residential lines for $70 a month, right?

Like Time Warner Cable, AT&T's press release very much wants the press and public to conflate their ability to offer 1 Gbps over the core network (and to businesses for a small fortune) with offering 1 Gbps lines inexpensively to consumers and businesses alike.

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However, the phrase "prepared to build" to those of us fluent in AT&T speak can be translated to "you sir, are very nicely dressed and I would be more than happy to hold your wallet while you visit the restroom."

Here on planet Earth, AT&T's current residential broadband offerings have struggled to keep pace with cable, much less fiber. Particularly upstream, where AT&T struggles to deliver 5 mbps to the vast majority of its customers. Remind me, what's the difference between 1 Gbps and 5 Mbps again?

Despite the very obvious reality on the ground, AT&T would have you believe that they're right there nipping at the heels of Google's 1 Gbps service, implying that the only thing that has kept Americans from seeing cheap 1 Gbps AT&T connections so far is -- the mean old government:
Today, AT&T announced that in conjunction with its previously announced Project VIP expansion of broadband access, it is prepared to build an advanced fiber optic infrastructure in Austin, Texas, capable of delivering speeds up to 1 gigabit per second. AT&T's expanded fiber plans in Austin anticipate it will be granted the same terms and conditions as Google on issues such as geographic scope of offerings, rights of way, permitting, state licenses and any investment incentives. This expanded investment is not expected to materially alter AT&T's anticipated 2013 capital expenditures....Our potential capital investment will depend on the extent we can reach satisfactory agreements.
While Google Fiber certainly has seen some sweetheart regulatory arrangements, AT&T too has spent the last decade being deregulated state by state, and the result hasn't been magic 1 Gbps blossoms and price-slashing fairies, it has almost uniformly been higher prices and worse service. That is courtesy of limited competition and regulatory capture, two things that Google Fiber will at least chip away at on a small, local scale.

Still, even with the added pressure of Google Fiber in one of their markets, and with added regulatory perks, AT&T's promises may not be reliable. While AT&T has promised to expand U-Verse as part of their above-mentioned "Project VIP" upgrades, that promised expansion is mostly smoke and mirrors. AT&T's focus is primarily on wireless and big investor returns (the exact thing a large-scale Austin FTTH build won't provide). The days of meaningful landline broadband expansion at AT&T are over, and most expansions moving forward will be theatrical in nature.

AT&T certainly could afford to offer a few FTTH lines to a select number of users to save face; the company does offer some users actual fiber to the home lines in upscale developments, though they historically cap those lines at fiber to the node speeds. Still, the press release claims these upgrades are "not expected to materially alter AT&T's anticipated 2013 capital expenditures." What kind of network expansion doesn't cost you much of anything? One that either doesn't exist, or is only deployed in a very narrow number of cherry-picked locations.

All of this could provide some weird and entertaining theatrics in Austin, but it doesn't do much for the tens of millions of AT&T DSL customers stuck on ultra-slow speeds the company has shown absolutely no interest in upgrading.

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Karl Bode
News Guy

2 recommendations

reply to delusion ftl

Re: Provide it to areas that really need it!

Well to be clear, AT&T very much likes the latter.