During a speech to the Detroit Economic Club today, AT&T CEO Ed Whitacre announced that the telco is expanding into the WiMax and satellite broadband arenas. Taking the latter initiative first, AT&T plans to offer satellite high-speed service in areas that its terrestrial networks don’t reach.
The offering will be extended in partnership with rural satellite service provider WildBlue with prices ranging from $49.95 to $79.95 per month, and broadband speed options ranging up to 1.5 Mbps downstream and up to 256 Kbps upstream. Like all AT&T Broadband services, this satellite option will come with a Yahoo co-branded portal.
The push into WiMax and other fixed wireless technologies will kick off later this year in Red Oak and Midlothian, Texas and Pahrump, Nevada, joining other AT&T fixed wireless service offers in Alaska, Georgia and New Jersey. You’ll notice that Red Oak and Pahrump aren’t teeming cities — they’re rural communities. The initiatives announced by Whitacre are aimed at expanding AT&T’s efforts to make sure that it’s hitting the less populous (and less well-to-do) regions.
A third initiative announced by Whitacre also bolsters the telco’s new-found goal of serving rural communities. He promised that within three years, AT&T will make its new IP-based, Lightspeed initiative video services available to more than 5.5 million low-income households within the 41 markets where the company is initially building its fiber-to-the-curb video networks.
Om says that these moves “could be attributed to some harsh business realities” faced by the former Bell companies, which are losing local access lines at a dismaying rate. He could be right, but I’m not so sure.
I bet that AT&T is polishing its image as a good corporate citizen, particularly by pushing into rural and lower income areas, so that it may earn brownie points as Congress weighs telecom reform legislation. Pushing the telco along, no doubt, is cable’s fight to impose “build-out” requirements on phone companies that enter the video businesses. The cable industry has accused AT&T and Verizon and the other top telcos of trying to redline their new video facilities by cherry-picking only the most profitable areas and avoiding the lower income and rural parts of franchises.
Cynthia Brumfield at 9:25 PM|Comments(3)
That's sort of a false dilemma question. They could wire themselves, if AT&T hasn't lobbied their state for laws banning them from doing so.
When it comes to Wild-Blue, they're simply re-selling service that's already available, so that's not new deployment. Those towns already could get satellite broadband.
No real new build-outs for Lightspeed were announced. They simply highlighted the lower income communities they had already targeted to deflect redlining criticism.
The Wimax & fixed wireless aspect could be interesting, but they're just scattered trials in a few small areas with no announced broad deployment.
So what was actually announced here? Nothing, really. Simply positioning themselves into a good defensive position to deflect criticism that the new laws they support will eliminate deployment requirements and legalize red-lining.
Posted by: Karl at May 9, 2006 12:10 PM
Just to play devil's advocate here:
Would you rather these last mile communities go without access rather than have the telcos polish their image while doing some good at the same time?
Posted by: Marvin at May 9, 2006 11:57 AM
"He could be right, but I'm not so sure.
I bet that AT&T is polishing its image as a good corporate citizen, particularly by pushing into rural and lower income areas, so that it may earn brownie points as Congress weighs telecom reform legislation."
Exactly. It's simply a political move. "We don't redline, users out of reach of our VDSL2 service can sign up for satellite broadband!"
"So there's no need for pesky rural deployment requirements in new national broadband laws!"
Plenty of press (if you look at the news-wire), and none of them mention this angle, which is the obvious truth behind the deal.
Posted by: Karl at May 9, 2006 9:47 AM
Blogs We Read
