AT&T Expects Mobile 5G in 'Parts' of 12 Markets by Year's End

AT&T said on its second-quarter earnings call that it is gearing up to launch 5G "mobile millimeter wave in parts of 12 markets" by the end of 2018, racing Verizon to be the first major carrier to start some form of 5G service in the US.

We now have a fair grasp on where the top two US wireless carriers will initially deploy 5G services. AT&T Inc. (NYSE: T) has named six of the 12 markets it plans to deploy in by the end of the year. Verizon Wireless Tuesday named three out of four 5G markets that it plans to deploy by year's end. (See AT&T Adds Trio of New Cities for 5G Launch in 2018, AT&T Reports $39B in Q2 Revenue; Expects to Spend $25B in 2018 Capex and Verizon Reveals Third 5G City, as Revenue Climbs 5.4% in Q2.)

Both carriers will deploy 5G on the high-band millimeter wave initially -- Verizon on 28GHz, AT&T confirmed on the band as yet -- using much higher radiowaves than previously seen with any earlier cellular standard. Both are expecting services to deliver around gigabit download speeds over the air. AT&T has reported coverage ranges of over 150 meters so far, although the operator was using fixed 5G equipment for these trials. (See AT&T & Verizon Plot (Sort Of) Mobile 5G Demos & Trials and AT&T 5G Tests Go Gaga for Gigabit.)

"Our mobile millimeter trials are going well, and we're on track to launch in parts of 12 markets by the end of this year," AT&T Communications chief, John Donovan said on the call.

Note the phrasing here, Donovan says "parts of 12 markets," this is probably because of the limited range of mmWave 5G. This is why AT&T is pushing its so-called "5G Evolution" efforts, actually a software upgrade to its 4G LTE network, which is now live in 140 markets and expected in 400 towns and cities by year's end. Donovan boosted "theoretical peak speeds" of 400-Mbit/s for the LTE-Advanced service. With the emphasis here being heavily on the theoretical.

Nonetheless, LTE-Advanced will be crucial for AT&T -- and other carriers -- as the 5G New Radio spec supports "dual-connectivity" with 4G. So if a 5G user steps out of range, they won't lose their connection, even if it slows down.

AT&T spent $5.1 million on capital expenditure (capex) for the 2nd quarter, which factors in payments of $300 million of payments for its FirstNet public safety network deployment. AT&T is expecting to spend $22 billion in capex for the full year of 2018, as it expects around $2 million of FirstNet payments in the coffers by then. (See AT&T on Track With 5G, Starts FirstNet Build.)

For the quarter, AT&T posted revenue of $38.99 billion; that was shy of Wall Street analysts' expectations, as compiled by Thomson Reuters , which was $39.39 billion. Net income was $5.1 billion. The carrier added 46,000 subscribers that signed on for a monthly smartphone contract, while it added 3.1 million devices overall, mainly because of connected device additions.

— Dan Jones, Mobile Editor, Light Reading