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AT&T U-verse Steps on Gas

Alan Breznick
8/26/2013
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Still playing catchup ball on the broadband field, AT&T Inc. is hiking its top broadband speeds in 40 more markets across the US, including such major metro areas as Atlanta, Chicago, Cleveland, Columbus, Detroit, Indianapolis, Miami, New Orleans, and Orlando.

AT&T announced Monday that it’s rolling out its new, high-speed U-verse Internet service tier, known as Power, to all these markets after introducing it in parts of California and Nevada late last month. The new Power tier offers downstream speeds as high as 45 Mbit/s, nearly twice as fast as U-verse’s previous top service, and upstream speeds as high as 6 Mbit/s. (See: AT&T Boosts U-verse Speeds in 40 Markets.)

Even with the increase, U-verse still trails badly behind the top speeds of Verizon Communications ’ fiber-enabled FiOS service. In a bold bid for broadband bragging rights, Verizon boosted FiOS’s fastest speeds to 500 Mbit/s downstream and 100 Mbit/s upstream last month, putting it second only to Google Fiber’s symmetrical 1 Gbit/s service in the Kansas City area.

Further, U-verse still trails well behind most of the largest US MSOs, which have all rolled out DOCSIS 3.0 throughout their regions. For instance, Comcast, Cox Communications, Charter Communications, Cablevision Systems, Suddenlink Communications, and Mediacom Communications all offer top downstream speeds of at least 75 Mbit/s, and nearly all of them offer 100 Mbit/s or more.

But more speed increases are on the way for U-verse. In its announcement, AT&T said it aims to boost U-verse’s top download speeds as high as 100 Mbit/s sometime in the future.

“We know customers want more speed,” said an AT&T spokesman, noting that the telco will keep extending the speed increases to other U-verse markets “on an ongoing basis” over the coming months. “That’s why we have plans to continue increasing speeds and expand availability of our U-verse offerings as part of our three-year, multibillion-dollar Project Velocity.”

Under Project Velocity, AT&T also aims to expand U-verse’s broadband reach by another 8.5 million homes, increasing its total footprint to 33 million households. The telco ended the second quarter with 9.1 million U-verse Internet subscribers, far more than Verizon’s 5.8 million FiOS Internet subscribers, after bagging a whopping 641,000 new customers in the spring, mainly by converting over more of its rapidly dwindling DSL customer base.

To entice consumers, AT&T is offering the new U-verse Power tier for an introductory price of $49.95 a month when the service is bundled with U-verse TV and voice products. Customers must also agree to two-year contracts. After that introductory period ends, the price will rise to $76 a month.

Current, eligible U-verse Internet residential customers can also upgrade their packages to the new service and receive $10 off their monthly bills for the next year.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

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albreznick
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albreznick,
User Rank: Blogger
8/27/2013 | 1:01:27 PM
Re: Still Lagging Behind
So it sounds like we could end up with a new digital divide, but this time in the wireless rather than the wireline space. Just what the nation needs, eh? How far do you think Google Fiber will go with its FTTP networks? think they'll be a real nationwide threat to the cable ops and telcos? Also, do you think AT&T and Verizon might overbuild each other someday? 
Carol Wilson
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Carol Wilson,
User Rank: Blogger
8/27/2013 | 10:22:08 AM
Re: Still Lagging Behind
Excellent point. Especially when you consider that the areas still dependent on DSL and phone lines are the exact same areas where LTE is not pervasive and will be more expensive to deliver. 
KBode
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KBode,
User Rank: Light Sabre
8/27/2013 | 10:17:00 AM
Re: Still Lagging Behind
Well, the push to deregulate is ever present, but they've been taking a slightly new deregulatory strategy in many states over the last year or two with a focus on killing rules that require they continue to provide DSL and POTS in areas they no longer want to:

http://www.muninetworks.org/content/kentuckians-once-again-fighting-keep-landlines

Both AT&T and Verizon want to kill DSL in huge swaths of markets, arguing that LTE will be good enough for those users. Granted a Netflix-gobbling household running face first into a 5GB cap with $15 per gigabyte overages is great for AT&T and Verizon, but not so great for consumer wallets. These are already mostly financially troubled areas they're targeting.

It's an issue that's kind of flying under the radar as we all get focused on how exciting LTE is, but forget it's not really a fixed line replacement -- in large part because of cost.

 
Carol Wilson
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Carol Wilson,
User Rank: Blogger
8/27/2013 | 10:09:39 AM
Re: Still Lagging Behind
That's what they are doing here - promoting somewhat smaller VRADs and free landscaping. My little village was ahead of the game, bringing in a second cable competitor back in the 90s, so there wasn't as much pressure here to enable competition. 

Sooo, the regulatory thing -- AT&T is encouraging these new regulations with the intent of using to justify an exit?
KBode
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KBode,
User Rank: Light Sabre
8/27/2013 | 10:07:02 AM
Re: Still Lagging Behind
I still think company claims that 80% or more will be able to get speeds up to 100 Mbps are generous. I know from years of listening to AT&T customers complain that loop lengths and line quality issues are going to make that a jumbo order. 

Granted it's also worth noting that AT&T's going state to state gutting regulations that require they continue offering DSL and POTS across huge swaths of markets (so they can exit them), so I really do think "Project VIP" is somewhat theatrical in nature.

I know the biggest remaining expansions for U-Verse will be in San Francisco and Indianapolis, which both I believe (like you) had issues with locals not appreciating the massive VRAD cabinets that suddenly pop up on their lawns.

I think AT&T's making progress on that front after offering to pay $1-2k for landscaping and beautification.
Carol Wilson
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Carol Wilson,
User Rank: Blogger
8/26/2013 | 5:12:57 PM
Re: Still Lagging Behind
I think they do well in some areas by being the lower-cost option. I can't get AT&T U-Verse, because my suburb didn't give in on free placement of the VRADs, but there are now rumors that AT&T is once again in negotiation on that topic.

It made me think they are taking further expansion seriously. I'd agree they still need short, clean loops to make the speed thing work but continuing to push copper to its limits does seem to be paying off for them.
Sarah Thomas
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Sarah Thomas,
User Rank: Blogger
8/26/2013 | 2:23:53 PM
Speed v. reliability
This is good news. I'm paying $32 for "Internet max," so the extra speed would only cost $8 per month during the promo period. May have to look into it. I haven't had much of a problem with the speed so far though, just the Internet going in and out, which is frustrating for us work-at-home types. Sometimes speed can be just good enough, but reliability is most important.
KBode
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KBode,
User Rank: Light Sabre
8/26/2013 | 2:21:19 PM
Still Lagging Behind
Even with these upgrades (which require clean lines and short loop lengths, so won't be available to many) AT&T's still lagging on the competitive front. I noticed the other day that even when they deploy U-Verse fiber to the HOME service at new greenfield deployments they're capping those users at 24 Mbps. You'd think this would damage AT&T more than it does, but at last look I think they still owned something like 55% of the United States broadband market all by themselves.
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