Changes in telecom technologies provide a gateway to create new business opportunities. The fourth generation (4G) of cellular technology standards, the rise in smartphone sales, and increasing mobile internet devices are transforming the telecom industry. These factors have reformed the industry into the most evolving sector. Which company will reap the rewards from this changing environment? There are limited players in the U.S. telecom market and the industry has high barriers for entry. AT&T Inc. (NYSE:T) and Verizon Communications Inc. (NYSE:VZ) are the largest telecom companies in the US. Let us review concrete steps taken by AT&T and how the company stands out from the rest of the telecom players.
AT&T is investing in future growth with Project Velocity IP (VIP). It is a three year planned investment in wireline and wireless IP broadband networks for accelerated growth. It mainly focuses on growing customer demand for high-speed Internet access and new mobile, app and cloud services.
Randall Stephenson, AT&T Inc. (NYSE:T) – Chairman and CEO said “We’re off to a strong start executing Project VIP, our plan to expand our high-growth platforms to millions more customers, and our 4G LTE network deployment is ahead of schedule, delivering outstanding performance.”
Mobile internet growth
4G LTE Expansion: AT&T plans to expand 4G LTE network to 250 million people in the US by year end 2013, and 300 million by year end 2014. Globally, the growth in LTE has been slow but it will gradually increase. In most countries where 4G LTE has launched, 3G and its variants have remained the dominant technology standards. Two main reasons for this are limited LTE customers and a narrow range of compatible devices. The industry expects that speed-seeking users will move to 4G services. There will be an additional approximate 150 compatible smartphones and tablets that will be launched by the year end 2013.
In year 2012, AT&T Inc. (NYSE:T) has acquired spectrum through more than 40 spectrum deals and has plans to buy additional wireless spectrum to support its 4G LTE network.
RootMetrics, an independent mobile analytics firm has published a report in March on 4G LTE download and upload speeds of different carriers. AT&T offered an average download speed of 18.6 Mbps and an average upload speed of 9.0 Mbps. Thus enabling ultra-fast downloads, faster photo sharing, app downloads and faster mobile Internet access. Verizon Communications Inc. (NYSE:VZ) recorded an average download speed of 14.3 Mbps and an average upload speed of 8.5 Mbps. In the second half of 2012, Sprint Nextel Corporation (NYSE:S) had average speeds of 10.3 Mbps for LTE download and 4.4 Mbps for LTE upload. Thus when compared to these two companies, prospective customers would subscribe to AT&T Inc. (NYSE:T) as they provide better download and upload speed.
Network quality, wireline IP and fiber network
AT&T expects to install small cell technology, macro cells, and additional distributed antenna systems to increase the density of its wireless network, which is expected to improve network quality and increase spectrum efficiency.
AT&T plans to expand wireline IP network to 57 million customer locations by year end 2015.
AT&T Inc. (NYSE:T) expects the proactive fiber deployment to increase business revenue growth. Hence they are planning to expand fiber network to reach additional 1 million business customer locations by year end 2015.