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Wednesday, March 11, 2009

AT&T Boosts 3G, Adds 3,000 Jobs

Despite a capex cut of up to $3 billion this year, AT&T Inc. made it clear today that it intends to spend to improve and expand its 3G network -- adding 3,000 jobs in the process to support "mobility, broadband, and video." That's slight counterbalance to the 12,000 job cuts AT&T announced in December. AT&T acknowledged this in today's press release, saying it expected to continue cutting jobs in its wireline operations.

AT&T reiterated that it's going to spend $17 billion to $18 billion this year. That's about even with its $17.7 billion in capital expenditures (capex) in 2007, but it represents a 10 to 15% cut from the $20.3 billion the carrier spent in 2008. AT&T has said, though, that it expects to keep its international spending at around the 2008 level of $1 billion.

AT&T's plans for 2009 spending include a lot of 3G work -- no surprise, considering 3G was a big earner for AT&T in 2008 with total wireless revenues up over 15% on 2007 to $49.3 billion. Much of this increase was driven by buoyant wireless data revenues and the continued success of the 3G iPhone

About two thirds of AT&T's capex this year will go toward increasing network coverage. Specifically, the operator intends to expand 3G service to 20 new markets this year with more markets converting to 850 MHz for better indoor coverage. It already covers nearly 350 markets with its 3G network.

The network will get faster too: AT&T intends to ramp up its high-speed packet access (HSPA) network to provide download speeds of 7.2 Mbit/s with "bursts" in the 20 Mbit/s range.

In the home, AT&T wants to expand 3G coverage with tiny base stations, promising "customer trials leading toward general availability of AT&T 3G MicroCell offerings, which utilize femtocells and home broadband connections to enhance in-building wireless coverage."
The firm also said that it will continue adding to its 20,000-plus network of WiFi hotspots in the U.S.

The press release quotes chairman and CEO Randall Stephenson saying data traffic on AT&T's network is growing at 50 percent per year.

| Dan Jones |

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