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Is Lightspeed Slowing?

Phil Harvey
5/26/2006

1:00 PM – Like an HDTV picture itself, AT&T Inc. (NYSE: T)'s broadband access challenges are crystal clear.

The company is mostly targeting affluent consumers with its Project Lightspeed rollout. But the company's U-verse service launched without HDTV channels and the carrier won't say how soon they'll be able to carry HD signals.

And aren't "early adopter" consumers (I'm not referring to Angelina Jolie here) the types that would (1) take a chance on Lightspeed and (2) expect to have HDTV service in more than one room?

Meanwhile, Wall Street analysts are piling on. This week analysts Tom Watts and Shaun Parvez of SG Cowen Securities wrote:

AT&T has reconfirmed its intention to roll out video to 15-20 markets by the end of this year. However, as we understand, these rollouts will have Standard Definition (SD) television only, and will carry no High Definition (HD) programming. Also, we believe AT&T will postpone deployment of video to any additional markets until its architecture can support HD. The primary constraint appears to be the bandwidth achievable using AT&T's FTTN architecture. Many 3,000 foot loops appear inadequate of supporting necessary transmission speeds. Moreover, the initial specifications for the DSLAMs/Edge Routers purchased by AT&T appear inadequate. AT&T may re-open the procurement for network equipment adding higher speed specifications and adding an additional vendor to supplement Alcatel. This would certainly result in capex increases, but would not solve the bandwidth constraints in markets with longer loop lengths. Ultimately, we expect AT&T to move to FTTC or FTTH in at least some of its markets.
Last month, Anton Walhman of ThinkEquity LLC had similar suspicions about AT&T's broadband plans:

Hey, all we're saying about Lightspeed anyway, is that we believe it probably won't happen as planned, with 25 Mb/s VDSL2 to 18 million homes by 2008. Rather, we believe AT&T will first focus massively on HomeZone, rolling it out first in its own territories (roughly a third of America, before buying BellSouth), and then nationwide with the support probably of a WiMax interactive IP pipe, or perhaps even some Covad in certain places. Then, it will have to find a way to crank up those speeds from the tiny 25 Mb/s, perhaps using shorter copper loops but retaining VDSL2 to reach close to 100 Mb/s. AT&T may also wait until the second half of 2007 and do GPON in some areas.

If AT&T were anywhere near succeeding with Lightspeed, why would there be so much sentiment to the contrary?

— Phil Harvey, Lightspeeding Editor, Light Reading

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bespoke
bespoke
12/5/2012 | 3:53:08 AM
re: Is Lightspeed Slowing?
As far as Verizon's already antiquated PON network is concerned, I'd hold off making such acolades for a couple of years. See where this cognitive radio fad goes.
apucheril
apucheril
12/5/2012 | 3:53:08 AM
re: Is Lightspeed Slowing?
Verizon's bold move to deploy FTTH seem brilliant
OldPOTS
OldPOTS
12/5/2012 | 3:53:06 AM
re: Is Lightspeed Slowing?
SBC/AT&T has followed the conservative, TELCO, approach of migrating to advanced technology as others prove it and then leveraging their (dwendling) customers to gain or hold market share.

I agree with those quoted in the article as the steps AT&T will migrate through.

VZ is doing the FIOS hard push in my neighborhood and couldn't understand why I wasn't signing up like my neighbor. (The same price for less capabilities after all the necessary add ins) Despite the hard push, in my relative affluent neighborhood, I judge a take rate of less than about one in ten. This isn't enough ARPU for any of the several business models I have seen.

OP
desiEngineer
desiEngineer
12/5/2012 | 3:53:05 AM
re: Is Lightspeed Slowing?
Phil: "If AT&T were anywhere near succeeding with Lightspeed, why would there be so much sentiment to the contrary?"

I imagine that's the real reason why the Wright brohters moved their test site to Kitty Hawk.

Revisionists say that the Kill Devil Hills had the right topography and air currents, etc., but in actuality, W & O were just tired of hearing, "If you guys were anywhere near succeeding with your flying machine, why do we not hear all the scientists coming and lauding you?"

50% chance of rain today. No, I'll be bold today: 40%.

-desi
opticalwatcher
opticalwatcher
12/5/2012 | 3:53:03 AM
re: Is Lightspeed Slowing?
It seems backwards with all this fiber to the node, fiber to the home, satellite, etc. when for most viewers the greatest number of HDTV stations comes from good old fashioned over-the-air local station broadcast (well, slightly modified over-the-air broadcast).

Does anyone reading this actually get Lightspeed television to their home? How well does it work? I always wonder about using Microsoft for televisions.
OldPOTS
OldPOTS
12/5/2012 | 3:53:00 AM
re: Is Lightspeed Slowing?
I thought there might be interest in these PEWInternet reported facts;


"Home broadband adoption grew by 40% from March 2005 to March 2006,
twice the growth rate of the year before."

Surprisingly not just in affluent communities;
"Growth in broadband adoption has been very strong in middle-income
households, and particularly fast for African Americans and those with
low levels of education."

And for those doubters;
"In a reversal of market share, telephone companies offering digital
subscriber line (DSL) services have overtaken cable companies in the
broadband world."

No wonder the TELCOs feel NO RUSH.

See for interesting detailed report;
http://www.pewinternet.org/pdf...

See this for more Internet reports;
http://www.pewinternet.org/PPF...


OP

Mark Sebastyn
Mark Sebastyn
12/5/2012 | 3:52:58 AM
re: Is Lightspeed Slowing?
This info comes up again and again whenever a Wall St. Analyst decides to make it news, but they add little to the analysis.

http://www.nyquistcapital.com/...

There is also a guy blogging his Lightspeed install.

http://www.satechblog.com/

very_objective_dude
very_objective_dude
12/5/2012 | 3:52:56 AM
re: Is Lightspeed Slowing?
tera,

I have to say that I agree with you. With analog technology, I guess it is difficult to control content protection and quality. However, with digital technology, there should not be any difference in quality for over-the-air vs FTTH. Also, with encryption technology, one could always control who is paying to watch. Obviously, a settop box and antenna would be needed, but probably cheaper than deploying FTTH. Afterall, it is already done via satellite.

Microsoft is one of those 800lb gorillas that will not go away. You can slow it down, but you can't stop it. Look at how Microsoft has penetrated web browser, cell phone, video games, and PDA. It may not work right the first time around, but it will keep coming back ....... Hate to say this, but so far, resistant has been futile ......
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