On the heels of AT&T saying it will no longer take new orders for its DSL service, the Communications Workers of America (CWA) criticized its lack of fiber on Monday. According to the report, which CWA did in conjunction with the National Inclusion Alliance (NDIA), AT&T has deployed fiber-to-the-home (FTTH) to 28% of the households in its footprint as of the end of June.
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By contrast, the report said AT&T has targeted more affluent, non-rural areas for its fiber upgrades. Houses with fiber have a median income that's 34% higher than those with DSL only. Across the rural counties in AT&T's 21-state footprint, 5% have access to fiber, according to the report.
While AT&T CEO John Stankey has said on several occasions that the telco wants to deploy more fiber, those fiber builds are slated to take place where they make the most sense financially, which may not include rural areas. Stankey has previously said that the telco would add more fiber to help provision its 5G services and more fiber-to-the-home broadband deployments.
As of last year's fourth quarter, AT&T had 1.3 million fiber route miles globally and led Vertical System Group's Leaderboard for the most fiber-lit buildings in the U.S. in 2019.
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In addition to wireless services, which include small cells requiring fiber backhaul to connect them to the network, AT&T is counting on fiber for both residential and commercial services, including AT&T TV. In order to win over customers from cable operators, AT&T has paired its 1-Gig service with AT&T TV.
"Our investment decisions are based on the capacity needs of our network and demand for our services," AT&T said in a statement to FierceTelecom Monday afternoon. "We do not 'redline' internet access and any suggestion that we do is wrong. We have invested more in the United States over the past 5 years (2015-2019) than any other public company. We have spent more than $125 billion in our U.S. wireless and wireline networks, including capital investments and acquisition of wireless spectrum and operations. Our 5G network provides high-speed internet access nationwide, our fiber network serves more 18 million customer locations and we continue to invest to expand both networks."
AT&T also said that while it continues to expand A&T Fiber within its footprint on an ongoing basis, connectivity "must be viewed holistically including wireless and wired connections." AT&T said it supports Federal policies to close the digital divide, and that it has encouraged legislators and policymakers to make broadband connectivity more sustainable, affordable and accessible. Last month, Stankey wrote an op-ed in Politico outlining his views on how to connect every American to broadband.
According to the report by CWA and NDIA, 14.93 million—out of almost 53 million households—have access to AT&T's fiber service. Among states, AT&T's FTTH build out is the lowest in Michigan with 14% have access followed by Mississippi (15%) and Arkansas (16%).
"AT&T is also failing to make fiber available to the majority of its customer base in cities," according to the report. "While most of AT&T’s fiber build has focused on urban areas—96 percent of households with access to fiber in AT&T’s footprint are in predominantly urban counties—the company hasn’t built enough fiber to reach the majority of urban residents. Seventy percent of households in urban counties still lack access to fiber from AT&T because the company has made fiber available to only 14.7 million households out of 48.4 million total households in these counties."
The report also said there were many areas in AT&T's footprint where it doesn't offer the Federal Communications Commission's standard of 25 Mbps on the downstream and 3 Mbps on the upstream.
"For 28% of the households in its network footprint, AT&T’s internet service does not meet the FCC’s 25/3 Mbps benchmark to be considered broadband," the report said.
The report noted that in some areas where AT&T doesn't provide faster speeds, cable operators, such as Comcast and Charter do.
"Even where that access is available from another provider—typically a cable provider—consumers are deprived of the benefits of competition in price, choice and service quality," the report said.
During July's second quarter earnings report, AT&T lost 102,000 broadband subscribers, but gained more than 220,000 fiber subscribers. As of Q2, AT&T had 4.3 million AT&T Fiber customers with nearly two million of them on 1-gigabit speeds. Overall, AT&T has about 15.3 million broadband subscribers while Charter has 28 million and Comcast has over 29 million.
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Last summer, AT&T said it would take a more incremental approach to its fiber build-outs after it met one of the FCC's requirements for its merger with DirecTV five years ago. The FCC required that AT&T expand its deployment of its high-speed, fiber-optic broadband internet service to 12.5 million customer locations, as well as to E-rate eligible schools and libraries, by July of last year.
"As a leader in both broadband and wireless networks with significant capital resources, AT&T should be upgrading its current customers and deploying the infrastructure of the future to new locations," the report said. "Instead, AT&T largely halted its national build-out of fiber to residential homes in mid-2019 after it met FCC-imposed conditions following the acquisition of DirecTV."