AT&T to Compete with Verizon, CenturyLink Local Access Networks

AT&T now says it is deploying fixed wireless using millimeter wave frequencies to apartment complexes in Minneapolis, outside its traditional 21-state wireline service area.

In case you miss the implications, this is the first time AT&T is going to compete head-to-head with CenturyLink in the consumer local access business, in CenturyLink’s footprint, aiming to supply 100 Mbps access service to each unit in a building. AT&T says it already plans to boost speeds to 500 Mbps to each living unit.

Up to this point, AT&T's consumer operations in the fixed network area have been confined to the 21-state region where AT&T has had operations growing out of the old Regional Bell Operating Company territories.

The move is akin to Comcast announcing it is going to serve customers in a Charter Communications franchise area.

While AT&T competes directly with Verizon in the mobile business, and with both Verizon and CenturyLink in the enterprise accounts business, AT&T has not overbuilt another telco in the consumer business.

There are many reasons for that situation. For one thing, AT&T wants to avoid running afoul of informal antitrust guidelines that tend to be triggered whenever a fixed network provider serves 30 percent of available U.S. homes.

By competing out of region as a CLEC, AT&T avoids increasing the number of U.S. homes passed by its incumbent provider fixed networks.

“If successful, this will give us the ability to offer a combination of Internet, DirecTV and wireless services to apartment complexes and multifamily communities in additional metro areas.” said Ed Balcerzak, AT&T SVP.

Additional areas under consideration where AT&T might do the same include Boston, New Jersey, New York City, Philadelphia and and Washington D.C., all in the Verizon Communications footprint.

AT&T says it also is looking at Denver  Phoenix and Seattle, in the CenturyLink region.

All those efforts would have AT&T operating as  a competitive local exchange carrier competing with Verizon and CenturyLink for the first time.

"Smart Cities" Benefits Likely Will be Smaller than Projected

Asset-light business models such as Uber and Lyft are about monetizing dark vehicle assets. Airbnb perhaps is about monetizing dark room and lodging assets, also using an asset-light approach.

Wi-Fi often is an asset-light approach to mobile device access. Netlfix might be considered an asset light approach to video entertainment, at least in terms of access assets.

In other cases, big data and Internet of Things networks aim to enable more efficient use of in-use assets.

Arguably, the most-powerful trends happen when multiple values can be realized, such as combining dark assets with asset-light business models with peer-to-peer transactions and “leasing rather than owning” consumption patterns.

All those potential changes in business models should eventually affect prospects for many proposed Internet of Things services, such as “smart parking.” If vehicle ownership declines as much as some expect, there will be less demand for urban area parking, and therefore less value and demand for smart parking services.

In other words, all currently-projected markets essentially extrapolate from existing conditions. But those conditions will change as IoT and IoT-assisted ecosystems change.

Similarly, smarter transportation systems that allow users to evaluate transportation options in real time will reduce the amount of vehicle congestion the smart systems aim to solve.

Where it comes to the impact of IoT systems, feedback loops will operate, changing the context even as the systems come online. In other words, non-linearity will be a key aspect of future IoT systems. In the process of solving specific problems, the magnitude of the actual problems will diminish.

That likely will mean the expected benefits will be smaller than forecast.

AT&T Launches New Internet of Things Data Plans

AT&T’s new data plans for Internet of Things developers and businesses shows you how AT&T believes IoT apps will use the mobile network. In contrast to “use by humans,” the emphasis is on transferred data, not the speed of transactions.

Available in October 2016, the IoT data plans are differentiate by the amount of data devices and sensors are expected to transfer, over a year’s time.

AT&T IoT data plans include:

• Option 1: 1 GB for $25.00 (valid up to 12 months)1; includes 500 text messages
• Option 2: 3 GB for $60.00 (valid up to 12 months)2; includes 1000 text messages
• Option 3: 5 GB for $100.00 (valid up to 24 months)3 includes 1500 text messages

India is Key Mobile Growth Market, Says GSMA

India now has become the mobile industry’s key growth market, says the GSMA Global Mobile Trends report.

More than one billion additional people worldwide will be connected to mobile networks by 2020 and 33 percent of these new users will come from India (337 million)

China is forecast to add more than 200 million subscribers and there will also be major net subscriber contributions from Indonesia, Pakistan, Bangladesh and Myanmar.

In total, these six Asian markets will account for approximately 60 percent of the 1.1 billion new subscribers added globally by the end of the decade.

source: GSMA

The GSMA report also argues that the “mobile Internet is the Internet.” Today, some 46 percent of the global population gets access the internet by a mobile device and network. By 2020, mobile Internet access will grow to 60 percent.

New mobile subscribers are more likely to be younger and are also more likely to be ‘mobile-first’ or ‘mobile-only’ internet users.

As there will only be a minimal increase in the number of fixed internet households over this period, the increase in mobile phone ownership will therefore be the key factor driving global internet penetration, GSMA says.

AT&T, Amazon Web Services Partner

AT&T and Amazon Web Services will work together to optimize delivery of integrated solutions built on the companies' respective cloud and networking capabilities.

The collaboration will focus in three main business areas, essentially melding AWS cloud computing capabilities with AT&T connectivity. In addition to cloud networking, Internet of Things and threat management will be areas where the two firms collaborate.

Though AT&T, Verizon, CenturyLink and other telcos have gotten into the data center business, all might be looking to exit the business. Some might say this is another example of telco inability to innovate. Others might argue that telcos are no different than other firms trying to innovate: failure is more common than success.

None of the U.S. telcos have been able to outperform the hyperscale cloud computing specialists--such as AWS--or achieve the scale of the data center specialists (Equinix, Digital Realty).

Some bets will work better than others, whether undertaken by Google or AT&T. In this case, AT&T likely has concluded that operating its own data centers provides less value than once hoped.

Some might argue that is not a problem. AT&T and other service providers must keep looking for new services and revenue drivers. As would be the case for Google, Apple, Facebook or any other innovator, not every bet works out as expected.

Failure is simply part of the process of discovering where value really does lie.

When is "Fiber to Home" Not "Fiber to Home?"

When is “fiber to the home” not “fiber to the home?”

When the Internet service provider selling the service is Google Fiber or AT&T Fiber. Google Fiber already is exploring ways to extend Google Fiber to more areas and locations using fixed wireless.

Now AT&T says it will do the same.

“Under the AT&T Fiber umbrella brand we will use a variety of network technologies to connect more homes, apartments and business customer locations to ultra-fast and low-latency internet speeds,” said David Christopher, AT&T Entertainment Group CMO.

“This new brand includes, but is not limited to, the former AT&T GigaPower network,” he said. “We will announce additional network technologies and products in our AT&T Fiber umbrella brand in the near future.”

AT&T apparently is testing a number of fixed wireless alternatives, including some new methods, plus millimeter wave spectrum. That is beyond AT&T’s believe that its default platform will be wireless.

Gigabit Internet access now is the issue, not the access media.  

AT&T Eventually Will Want to Own More of the Content it Delivers

It has been a staple of strategy for the leading U.S. cable TV operators, for more than a couple of decades, that a distributor has to own at least some of the content it delivers. That is why the leading cable TV companies own programming assets.

Keep in mind that some questioned whether distributors (cable TV companies) would be “good” at operating programming entities. That has not proven to be a general problem, though execution always is an issue.

AT&T, already the largest U.S. supplier of linear video, and moving to become a major provider of “over the top” content, is likely to be subject to many of those same objections, much as telcos once were questioned as providers of linear video entertainment services.

That should logically lead to AT&T becoming an owner of content assets, for the same reasons cable TV operators made the move into content asset ownership: access might be a commodity; content is not.

If you want to know how it is that gross revenue for content services can grow, while gross revenue for other services declines, it is the difference between what is scarce, and what is not.

Simply, network access, plain vanilla voice and messaging are largely commodities. It is difficult to differentiate, there is lots of competition, many product substitutes and suppliers. But video entertainment is not an “access to the network” service.

Customers buy the content, not bandwidth; experiences they want, not minutes of use. Network access is simply part of the product, not the reason any consumer buys the product.

Given its commitment to content revenues, it is not a stretch to suggest that AT&T likely will follow the clear strategy followed by cable TV companies: own at least some of the content delivered by the content service.

That is among the antidotes for ever-declining average revenue per unit, per account or per user. Access, computing and transport follow Moore’s Law, in terms of price-per-unit of capacity. Content does not.

At least historically, content assets--where consumers perceive value--appreciate where it comes to price. Profit margins are easier to defend, as well.

So look for AT&T to make big moves into content ownership. It is a proven strategy for many tier-one video services providers.