
AT&T's 'Expansion' of 1 Gbps to 100 Cities is a Big, Fat Bluff - lelf
http://www.dslreports.com/shownews/ATTs-Expansion-of-1-Gbps-to-100-Cities-is-a-Big-Fat-Bluff-128628
======
dm2
I had an AT&T salesman come to my door just a few days ago to try and sell me
their new "fiber" they had just installed in my area (I'm in a large city
mentioned in the article), telling me all of the benefits of having fast
internet. I had to lie and tell him I didn't own a TV in order to get him to
stop talking about the 300 channel TV/internet bundle.

When I finally squeezed the actual speed of it out of him the answer was 18
Mbps, for $60 a month (of course he could get me a special deal of $40 for the
first 3 months, which is the same deal as on their website).

I've used them before (AT&T Uverse) and they require an ATT router/modem, for
an additional fee of course, even though using their hardware is technically
completely unnecessary.

I actually told him that Time Warner was currently cheaper and more reliable
than what he was offering, which is true unfortunately.

AT&T is a joke.

~~~
xhrpost
They run fiber to their Uverse nodes and then apparently tell their
salespeople to sell this as a feature. I remember one telling me the benefits
of a "fiber optic signal" somehow going to my house over copper. I still ended
up switching later on since they're cheaper than my local cable provider,
though network performance doesn't seem to be as good.

~~~
JonFish85
Maybe they're using Monster cables, for a better digital signal? (Kidding,
hopefully obviously)

~~~
deeviant
Nay, ATT would need 2x the GDP of the entire universe to acquire enough
Monster Cable for that.

------
earlz
This article is spot on. I've had countless reps try to sell me on U-Verse
"It's fiber to your neighborhood, so it's faster"! My next question is of
course "How fast?" "Well, you can get up to 18mbit/s".. I have faster than
that with cable. wtf

That's not to even mention their HORRIBLE modems that they force you to use
after migrating to U-Verse. Search for "nvg510" and you'll see how happy your
service will be afterwards, assuming they aren't using old unreliable DSL
pairs that make it so your specific house can only get 6mbit or 1.5mbit,
despite your neighbor getting 16mbit

Oh, and also in my city you can't even buy just U-Verse internet. you have to
buy into their crap "digital" (another word for heavily MPEG compressed) TV
service

~~~
ilyanep
Yup. I had to specifically buy another router to use with the modem because
the U-Verse default routers don't even let you set custom DNS servers and
AT&Ts were significantly slowing my connection.

------
rayiner
> In short, if your city plays nice and gives AT&T what they want
> legislatively (namely gut consumer protections requiring they keep serving
> DSL users they don't want so they can focus on more profitable wireless)

I think the author is being hypocritical in holding this against AT&T while
ignoring the fact that Google is only rolling out fiber in cities that agree
to basically leave them alone from regulatory standpoint. And while the author
complains about AT&T not upgrading legacy DSL users, you don't exactly see
Google or anyone else going after that "lucrative" market.[1] You don't see
Google, or anyone else, jockeying to offer service in cities with insane
build-out requirements.

The author, Karl Bode, clearly understands _why_ nobody wants to roll out
these services: [http://www.dslreports.com/shownews/Baltimore-Still-
Begging-V...](http://www.dslreports.com/shownews/Baltimore-Still-Begging-
Verizon-for-FiOS-123588) ("Baltimore is one of many cities who simply want
somebody to come in and provide better broadband service, but don't offer an
attractive enough return on the investment for any large, investor-forcused
private company to bother.") That's true for Google as much as it's true for
AT&T. Google's ability to cross-subsidize with its advertising business
changes the numbers a bit, but at scale, that's the bottom line.

That said, I think Google Fiber adds a lot of value. I don't think they're
going to shame AT&T/Verizon into doing deployments that don't yield an
attractive return on capital. It may have the more important effect of putting
municipalities on notice that if they want fiber, from anyone, they need to
cut the strings attached.

~~~
ryoshu
The $200 Billion Rip-off:
[http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_0026...](http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_002683.html)

The telcos have already promised to lay fiber, received concessions for it,
and delivered little to nothing. Google may start ripping off taxpayers like
that, but I'll give them the benefit of the doubt until I see it.

~~~
rayiner
The $200 billion figure doesn't represent real money that changed hands. It's
an estimate based on taking the actual profit margin of the telecom companies
since deregulation in 1996, and calling everything over 9-10% to be "excess
profits." The premise is that telcos "promised" to lay fiber in return for
being deregulated, and that if their profit margins had been limited to rates
typical of a regulated utility, they would've made a lot less money.

Of course, it's easy to play this game with any company. Google's profit
margin is over 20%. According to this reasoning, every year Google is "ripping
off" the public to the tune of $6 billion. Obviously it's ridiculous to just
pick a number as the "right" profit margin for an industry and call everything
above that number "excess profits." But that's precisely the premise
underlying the $200 billion "rip off."

There was no "rip off." The premise of the 1996 reform was that deregulation
of the industry would create an incentive for companies to invest private
capital. And that has proven true. Over the last two decades, telecom and
cable companies have been among those with the highest capital expenditures.
What happened is that nobody predicted wireless would become such a big deal.
So instead of going into fiber, all that money was invested in wireless
instead. That's the major reason why fiber deployment never really
materialized--spending that money on wireless made a lot more sense.

And from a consumer standpoint, it still mostly does. I don't even have
internet service at my house--but I've got two different LTE subscriptions.

~~~
drewcrawford
> According to this reasoning, every year Google is "ripping off" the public
> to the tune of $6 billion.

This comparison is invalid because Google's business is fundamentally
different than a telecom in every relevant dimension. Telecoms sell a
commodity product with technology they source entirely from third parties, the
only form of product differentiation they have is geographical monopoly, and
it is a zero-sum game: basically none of AT&T's budget goes to R&D [1], and
all of it goes to operating AT&T's existing business exactly as it is now [2].
Meanwhile Google's core business is basically the opposite in every dimension.

A much better comparison would be to a water company or power company that has
"too high" of a profit margin. And of course people _do_ complain about that.

[1] [http://www.cnet.com/news/meet-the-group-trying-to-make-
at-t-...](http://www.cnet.com/news/meet-the-group-trying-to-make-at-t-very-un-
at-t-like/)

[2]
[http://www.att.com/Investor/ATT_Annual/2013/downloads/att_20...](http://www.att.com/Investor/ATT_Annual/2013/downloads/att_2013ar_completefinancialreview.pdf)

~~~
rayiner
This data point shows that AT&T spent about $1 billion on R&D in 2010:
[http://www.bizjournals.com/dallas/print-
edition/2010/11/19/f...](http://www.bizjournals.com/dallas/print-
edition/2010/11/19/five-cos-spend-39b-on-rd.html?page=all). Yes, it's a "drop
in the bucket" compared to their $20 billion in capital expenditures, as noted
in your article ([1]), but it's hardly "basically none." Also, a lot of
sophisticated engineering goes into building out infrastructure, even if it's
accounted to capital expenditures and not R&D.

Water companies and power companies are generally, true monopolies, in that
they're protected from competition and guaranteed a rate of return on their
investment. AT&T and the other telecoms are very different. They might have
certain geographic advantages, but AT&T is rarely the only wireless or telecom
provider in any given market, and its capital expenditures come out of it's
own pocket. It can't turn to a rate setting board like a power company or
water company to guarantee cash flow to cover investment.

You can't have your cake and eat it too. If you want to develop telecom as a
regulated monopoly, which worked just fine in the U.S. for the better part of
a century, then you need to give companies monopoly protections. If you want
to have a market, then you can't regulate rates of return. When you pretend to
have a market, then encumber it with excessive regulation, you can't complain
when companies don't invest private money into expanding infrastructure.

~~~
drewcrawford
Your source states that AT&T spent "0.8 cents" "of each dollar of revenue" on
R&D. Secondly, if you dig into the source [1] of your source, you find that
R&D spending for North American telecom companies in 2013 are dead last
against every other industry as a percentage of revenue. I renew my claim that
"basically none" R&D spending is a fair and accurate description.

> AT&T is rarely the only wireless or telecom provider in any given market

That is technically true, but I would paint the same facts as "approximately
96% of the population has at most two wireline providers". [2] This is an
_optimistic_ estimate: "the data used here do not provide adequate information
on price and performance to determine if multiple providers in a given area
compete head-to-head".

> If you want to have a market, then you can't regulate rates of return.

I don't disagree with you there. I think where we disagree is that you think a
competitive market for wireline broadband in the US in 2014 is a possible
scenario. In my mind, the regulated monopoly (or public utility) is the only
viable model.

[1] [http://www.strategyand.pwc.com/global/home/what-we-
think/glo...](http://www.strategyand.pwc.com/global/home/what-we-think/global-
innovation-1000/rd-intensity-vs-spend-2013-v2stage)

[2]
[http://books.google.com/books?id=l8oI5rA_NpQC&pg=PA37&lpg=PA...](http://books.google.com/books?id=l8oI5rA_NpQC&pg=PA37&lpg=PA37&dq=broadband+competition+more+than+one+provider&source=bl&ots=HknYAyaKQL&sig=VEUkjObhaBXsGMJcB5cEsRvkSaE&hl=en&sa=X&ei=J5xVU8L8A8q92gXrpYDoAw&ved=0CEQQ6AEwAw#v=onepage&q=broadband%20competition%20more%20than%20one%20provider&f=false)

------
daigoba66
ATT UVerse is the one of the biggest disappointments I've faced as a consumer.

When Verizon FIOS first came about I was super excited. And then I learned
that since my town is part of ATT-land, I'm forever locked out of obtaining
it.

A few years later ATT announces UVerse (fiber-to-the-home) in select markets.
Again I'm super excited, and I anxiously await the day it's available for my
street.

Years later that day finally comes. Only then do I realize that they have
since re-branded their entire DSL product line as "UVerse". So all ATT
customers can get UVerse, great! But only a very select few will actually get
fiber-to-the-home.

What a load of crap.

~~~
sureshv
Most of UVerse is FTTN, after which it is VDSL2 to the premise site; hence
bandwidths that are 24Mbps at most. I have U-Verse and get around 18Mbps at
most but since the line is shared with their TV service it can drop down from
there.

------
wmf
AT&T's door-to-door salespeople told me that my 30-year-old single-family
house in Austin will be eligible for GigaPower in the summer, so maybe it's
not quite as bad as the article says.

Charging $30/month to not spy on me is bullshit, though.

~~~
fsckin
I would happily move to get faster internet speeds, but all of the
neighborhoods AT&T are targeting seemed to be expensive when I checked them
out.

This jives w/ what the article says:

>>What's actually happening is that AT&T is upgrading a few

>>high-end developments where fiber was already in the ground

>>(these users were previously capped at DSL speeds) and

>>pretending it's a serious expansion of fixed-line broadband.

On the other hand, Google Fiber seems to be planning connectivity all over the
place, since they're tasked w/ providing free service to various community
hubs selected by the city which are widely spread out.

------
higherpurpose
I've already seen some sites like TheVerge falling for AT&T's BS, and just
parroting their press release. I don't know why anyone would take what a
company like AT&T is saying for _granted_. You should be doing the opposite of
that and question everything they're saying.

------
iOsyss
AT&T has made it their goal to trick the average consumer by having their reps
go around telling everyone in Austin they now have fiber in their area!

The reps won't even give the speed of the line until asked and the majority of
responses when asked are Download Speeds of 15-30Mbps. Time Warner has cable
options doubling this and the price is better.

AT&T is basically trying to confuse their customers before google fiber hits
Austin and it's the most immoral thing I've seen in a long time.

~~~
bradknowles
I live in Austin, and I have had U-Verse for months. I've got ~40Mbps down,
and that's pretty reliable and with low latency.

I had AT&T sales reps come by the house a few weeks ago to try and sell me
U-Verse, and I was able to tell them more about my service that I already had
than they were told to offer to anyone else in my neighborhood.

The only thing they had to hook me on was TV, and I told them we were getting
rid of all TV service.

And no, I didn't really feel sorry for them at all. Three nice young people
out for a neighborhood walk where they will probably make a years worth of
sales commissions in just a few hours. They don't deserve any pity or sympathy
from me.

------
hkarthik
I live in an area of suburban Dallas, TX where the city and telcos laid fiber
over 7 years ago. U-verse has always been capped for us. I'm hoping we get on
the list for Gigapower but any attempts to get information on this have been
futile. Local reps know nothing about Gigapower and emails to corporate get no
response.

I had such a poor experience with Uverse when it first came out that it made
even TWC internet look significantly better so I've stuck with Time Warner.

------
gonzo
I live in Austin, TX.

I have Grande and AT&T fiber to my home.

AT&T will not sell me their (current 300Mbps, future 1Gbps) service.

Grande will.

When Google Fiber arrives in my neighborhood, I'll probably keep both Grande
and Google. (Because it makes for an excellent test of pfSense, and as co-
owner of the company behind pfSense, I'm into testing it.)

------
johnohara
The recently deployed AT&T fiber infrastructure for U-Verse is first class and
very well built. It will handle 1Gbps+ when it needs to.

But not over CAT-3 neighborhood wiring.

The fact is nobody, not AT&T, Comcast, Verizon, or anyone else, is eager to
deploy fiber to each home's "de-marc." It's expensive, time-consuming, and
labor intensive.

The last mile is a good place for municipalities to get involved, possibly
under some form of revenue sharing plan with the carriers.

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ulfw
The definition of vaporware. Powered by at&t

------
ceautery
I hear it's actually going to be 1.21 Jigga-bps.

