In its quarterly financial call last week, AT&T executives gave a progress report on the company’s network upgrade programs. Some highlights of the call:
- In 2009, AT&T added 1,900 new cell sites, more than 100,000 new circuits for backhaul, four times our 2008 total.
- The composite quality index for voice on the wireless network was up 22% in 2009.
- Data throughput increased more than 19% during the past year.
- 3G block calls were down 25%.
- 3G drop calls were down 22%.
- Congestion in New York City and San Francisco — In Manhattan, there are periods when nearly 70% of the devices active on the network are data intensive handsets. AT&T is adding third and fourth radio network carriers to maximize capacity on available spectrum. The company is increasing the amount of 3G spectrum and radio capacity by one third in high-volume areas. It is also adding cell towers and upgrading high-capacity antenna systems.
- HSPA 7.2 — AT&T has completed the software upgrade to its 3G network nationwide. It currently offers 10 devices that are HSPA 7.2 Mbps capable. The next step is to build out backhaul, focusing first on highest traffic cell sites.
- AT&T anticipates that the majority of mobile data traffic will be carried over fiber-based backhaul by the end of this year.
- Already, the first metro clusters with HSPA 7.2 show average throughput increasing nearly 50% during peak conditions.
- AT&T has not made a clear declaration on whether it will deploy HSPA upgrades beyond 7.2 Mbps.
- Apple’s iPad — AT&T said it will work closely with Apple in planning for iPad connectivity to the network. The iPad will use HSPA 7.2 Mbps. iPad represents a different revenue for AT&T because it is not subsidizing the device.
- AT&T is predicting that iPad users will be heavy network users, likely more than iPhone and similar to 3G laptop users. However, many iPad users are likely to use the device at home or in schools, cafes or airports — places where Wi-Fi networks are usually available. Because users will pay in advance by credit card, AT&T is forecasting that its billing and support costs will be low.
- 2010 CAPEX — $18 billion to $19 billion range. That is up 5% to 10% overall versus 2009, with investments in wireless up substantially.
- AT&T expects a substantial increase in wireless and backhaul CapEx, which will be about $2 billion.
- The amount of new capacity in the wireless network in 2010 will be 2X greater than in 2009.
- In 2010, AT&T plans to deploy 2,000 new cell sites. It will also increase deployments of radio network controllers.
- Ethernet backhaul connections to cell sites will be 10X greater than in 2009. This includes 3X more fiber-to-the-cell-site departments compared to last year.
- LTE trials — planned for 2 markets in 2010
- U-verse — on track to reach 30 million living units by the end of next year. U-verse revenues nearly tripled over the past year, and on an annualized basis, now approach $3 billion. U-verse TV penetration now approaches 13%, and in areas marketed to for 24 months or more, overall penetration is better than 20%.
An archived webcast is posted in the Investor’s section of the company’s website.
http://www.att.com