Towns Start to Realize AT&T's Gigabit Fiber Promises Are Hollow:

Last week we noted how AT&T has effectively conned the press into believing the telecom giant is engaged in a massive gigabit fiber to the home build, despite the fact that the company's CAPEX and fixed-line network investment budget continues to drop. In reality, AT&T's singling out high-end developments and universities (where fiber is already in the ground) for highly selective gigabit service, then declaring an entire market "launched."

The resulting, gushing press lets the company appear to be keeping pace with operations like Google Fiber and municipal broadband options. But when customers in these "launched" markets actually try to sign up for service, they'll often find themselves disappointed.

Case in point is Gaston County, North Carolina, where AT&T loudly announced it had launched gigabit service back in August. As we've seen in so many markets however, locals there are increasingly confused as to why they don't qualify for service, a question AT&T (for obvious reasons) doesn't want to clearly answer:

quote:

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So exactly where is it available now? And why at this house, but not that one? And how long might it take to extend elsewhere?

AT&T isn't providing those types of answers. "Our network is a complex organism," AT&T spokesman Josh Gelinas said.

...Gelinas said there's no quick and easy explanation for why the fiber-optic connection is already in place in some specific addresses, but not others. AT&T doesn't want to get into discussions about where it has existing fiber-optic corridors, he said.

"Part of what drives the expansion is where we already have our existing network in place and where it makes good business sense to expand," he said.

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And, when you're actually trimming your fixed-line broadband investment budget year after year, the places "where it makes good business sense to expand" are the places it costs virtually no money to connect. AT&T insiders familiar with AT&T's Gigapower deployment plans tell me that for many Gigapower markets, "launched" can quite literally mean just a few homes in a development community on a hill.

Privately, AT&T techs often candidly tell customers the same thing: their chances of ever getting gigabit fiber are slim to none.

That's not to say AT&T's not working hard in a handful of areas where competition has forced their hand. There's certainly select pockets -- like Austin and the North Carolina triangle -- where AT&T can quite visibly be seen working hard to keep pace with Google Fiber and municipal broadband deployments. But by and large Gigapower remains a hollow show pony in the majority of less competitive AT&T broadband markets, propped up by AT&T math (TM) and an easily duped press.

And cherry picking the most lucrative locations for fiber all makes sense from a business perspective, though it's important to remember AT&T and Verizon alone have received enough federal and state subsidies over the last few decades to wire the entire country with fiber to the home several times over (sadly nobody's done an audit, and with the two companies' collective political power, nobody ever will).

Again, the company's dropping CAPEX and investment budget numbers (already dominated by wireless) are the tell tale sign that AT&T's gigabit deployment is a tiny fraction of the size it's being portrayed as in marketing materials. You'll know AT&T is serious about gigabit fiber for "up to 100" markets when earnings reports and filings show it's actually paying for it.

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