AT&T's Stephens: We'll reach 2.6M locations with FTTH by end of 2016

AT&T (NYSE: T) says it's on track to extend its fiber-to-the-premises (FTTP) service to over 2 million locations by the end of 2016, nearly doubling the reach of its fiber network as fulfills FCC requirements related to its DirecTV deal.

John Stephens, AT&T

Stephens

Speaking to investors during the provider's second quarter earnings call, John Stephens, CFO of AT&T, said that the service provider will be able to get to 2.6 million residential and business customer sites by the end of the year.

If the telco reaches this amount, AT&T will exceed the earlier milestone it reached by installing service to 1.6 million locations as of the end of April.

"Over the next few years, we expect to reach at least 12.5 million customer locations with our gigabit broadband service," Stephens said during the earnings call, according to a Seeking Alpha earnings transcript. "We now have more than 2.2 million fiber-to-the-home customer locations and we expect to reach 2.6 million or more by the end of the year."

The service provider has been on an aggressive rollout campaign for its fiber-based broadband service, announcing GigaPower launches in multiple markets including most recently Louisville, Kentucky and Indianapolis.

In addition to serving residential homes, the service provider has been extending the same GPON-based services to deliver 1 Gbps services to local business customers that reside in its "Fiber Ready" buildings.

Although it met its goal to bring fiber bring fiber to 1 million business locations in its wireline territory via the FTTB program within its Project VIP initiative, the service provider previously told FierceTelecom that the next priorities for FTTP in the business segment growth will be driven by its on-demand Ethernet service and GPON-based products.

Some of the new GPON-enabled business markets include Alabama and Atlanta, Los Angeles, Kansas City, Kansas, and Oklahoma City. 

Stephens said that as AT&T moves forward with building out homes and business it could surpass the FCC's 12.5 million requirement, but could not provide a specific timeline or how many locations it could add above the original number.

"There's particulars within the agreement that allow us to build -- count so many greenfield builds, count so many more upgrades in the existing IP broadband footprint -- to utilize in some cases multiple dwelling units, and then in many cases require some level, or a significant level I should say, of new builds," Stephens said. "When you're done with that, you may still have some profitable builds that are at or above the 12.5 million locations commitment and you may go ahead and build those. We'll see where that goes over time and we'll see where that leads us."

Ultimately, AT&T's FTTP builds will be driven by what potential return on investment the telco can get.  

"Overall, it's kind of a normal business-case process and where we can serve our customers the best and get the best returns for them and us," Stephens said.

For more:
- listen to the earnings webcast (reg. req.)
- read the earnings transcript (sub. req.)

Special report: Tracking wireline telecom earnings in Q2 2016

Related articles:
AT&T adds just 74K broadband subscribers in Q2, but expects year-end bounce back
AT&T gains 186K broadband subs in Q1 2015, but overall adds down year-over-year
AT&T begins deploying GigaPower in Louisville, Kentucky
AT&T lights 1.6M FTTH customers with services, says it's on track to meet FCC commitments

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