4G Kills the Copper Plant
8:25 PM -- We can't rewind; we've gone too far.
It's been a big week in storms, elections, events and awards here at Light Reading Mobile and maybe for you, too.
But we can't ignore that the two largest phone companies in the U.S. are moving more quickly to kill off fixed phone lines, DSL and rid themselves of expensive copper infrastructure and the legal requirements that surround it. These technologies are to be replaced with either 4G Long Term Evolution (LTE), IP broadband fiber or some combination of both.
Verizon Communications Inc. (NYSE: VZ) CFO Fran Shammo hammered the newest nail into copper's coffin this Thursday at a Wells Fargo Securities LLC conference. (See Verizon CFO: Spectrum Sale to 'Play Out' in Q1.) "I think we're on a good path to execute on what we've talked about on the copper-to-fiber migration," he told the crowd. "We have already gotten relief from a number of states on carrier of last resort, we're no longer called the carrier of last resort in a number of states we deal in," he said.
Carrier of last resort -- or COLR to its friends -- refers to the legal requirement that every American household should have access to a phone. Shammo said that Verizon is taking the local route to free itself of pesky COLR requirements. Traditionally, the states -- rather than the Federal Communications Commission (FCC) -- have handled the COLR rules for carriers.
Nonetheless, AT&T Inc. (NYSE: T) revealed Wednesday that it has petitioned the regulator over ways to update its rules so that wired or wireless IP systems can be considered as a replacement for the traditional copper phone-line system as part of a $14 billion investment plan in 4G and IP Broadband. (See AT&T Puts Up $14B to Boost Broadband.)
"AT&T has also filed a petition with the FCC today suggesting issues to consider in our ongoing work to modernize our rules for the evolving communications market," stated FCC Chairman Julius Genachowski about Wednesday's petition.
"As we review AT&T's filing, we will focus on the principles that have guided our actions since I became Chairman: driving the virtuous cycle of private investment and innovation in the broadband ecosystem, promoting competition, and protecting consumers."
Getting rid of copper stands to save carriers lots of money over the long term. Wall Street may wince at the money AT&T is having to spend for these upgrades but its probably the price of remaining competitive within the next few years.
For consumers, these developments clearly throw up a couple of questions:
- If AT&T or Verizon are not the carrier of last resort anymore will another -- obviously smaller -- operator be able to take up that role, or it just simply an outmoded concept now?
- In the light of Sandy and other recent disasters, will the FCC be able to come up with reasonable backup and redundancy requirements for wireless and other IP networks? (See Sandy: The Case for Better Cell Site Backup?.)
Or, as we move into the age of small cells, mobile video and voice-over-IP as the medium and mechanism of communications is that too simply a laughably outdated idea? (See Small Cell Service: If 9 Was 6.)
Let me know what you think.
— Dan Jones, Site Editor, Light Reading Mobile