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AT&T spends $6 billion on expanding its network in the second quarter.

AT&T: Capex Freeze? What Capex Freeze?

Dan Jones
7/23/2014
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AT&T has spent big on capex so far this year as it draws towards the end of its 4G LTE deployment in the US.

AT&T Inc. (NYSE: T) CFO John Stephens said Wednesday evening on the operator's second-quarter earnings call that Ma Bell had $6 billion in capital expenses in the second quarter of 2014. Despite this, the operator still says that it will spend $21 billion in capex for 2014.

"It's going to be hard work," Stephens said of the $21 billion target. AT&T, however, has been front-loading a lot of its capital spending in the early part of the year.


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AT&T is now very close to completing its 4G LTE buildout in the US, which will cover 300 million potential customers. The total potential customers covered now stands at 290 million, and the operator expects to be done this summer.

Stephens, however, essentially said on the call that rumors of an AT&T capex "freeze" have been greatly exaggerated. (See AT&T Investing in LTE Video Despite Capex 'Freeze'?.)

Major rival Verizon Communications Inc. (NYSE: VZ) is guiding $16.5 million to $17 million in capital expenditure for 2014. (See Verizon Continues 4G LTE Capacity Spend in Q2 .)

— Dan Jones, Mobile Editor, Light Reading

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DanJones
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DanJones,
User Rank: Blogger
7/24/2014 | 3:51:10 PM
Re: A few thoughts...
Does this CAPEX include the ALU's and Fujitsu's Network Cloud deal?

 

Not much if any, deployment starts late this year.
bosco_pcs
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bosco_pcs,
User Rank: Moderator
7/24/2014 | 1:02:55 PM
A few thoughts...
A few thoughts...

Does this CAPEX include the ALU's and Fujitsu's Network Cloud deal?

Ray, my bet is vendors don't mind diversifying but the international scene is more competitive especially from the Asian guys (hint! hint!)

Telecom is always lumpy anyway, feast or femine!
KBode
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KBode,
User Rank: Light Sabre
7/24/2014 | 12:41:22 PM
Re: Brace yourselves....
Yes, and I think what wireline investment they do plan may be on hold as they try to sell state lawmakers on the idea that they should be unburdoned from regulations requiring they continue to provide POTS and DSL to customers in territories they no longer want. AKA the "IP transition" where there's significantly more wireless as a rural stopgap measure and significantly less rural DSL.
Carol Wilson
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Carol Wilson,
User Rank: Blogger
7/24/2014 | 12:35:14 PM
Re: Brace yourselves....
It seems based on a lot of what AT&T is saying to the FCC and the states that their investment is in the wireless access approach. And they said today there is still plenty of room for growth in U-Verse subs based on where that's deployed now. So there may not be much incentive for wireline investment. 
KBode
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KBode,
User Rank: Light Sabre
7/24/2014 | 11:49:40 AM
Re: Brace yourselves....
It's not going to the Gigapower 1 Gbps home initiative, either. They keep insisting that effort will have no meaningful impact on CAPEX. Wireline investment continues to drop year over year...
SReedy
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SReedy,
User Rank: Blogger
7/24/2014 | 10:58:35 AM
Re: Brace yourselves....
Well, it looks like they won't be spending it on managed services though. Ericsson is sure doing a lot of backpedaling! After saying it was talking to AT&T and Verizon about outsourcing network operations, Ericsson CEO Hans Vestberg now says it's not gonna happen. http://www.fiercewireless.com/tech/story/ericsson-ceo-says-att-verizon-unlikely-outsource-network-management
Ray@LR
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Ray@LR,
User Rank: Blogger
7/24/2014 | 7:58:49 AM
Brace yourselves....
It's white-knuckle time for the vendors that rely heavily on AT&T and VZON.... some now wishing they'd spread their international wings a bit sooner/quicker, I bet...
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