LTE -- What Voice Services?
by Jose Deras
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SBC's Whitacre Sees Growth in DSL but No Incentive for FTTP
SBC Communications added its three millionth DSL customer earlier this week. Edward E. Whitacre Jr., SBC chairman and CEO, said DSL growth continues to accelerate "as more consumers and businesses move to broadband." Speaking at the Morgan Stanley Global Media & Communications Conference in Boston, Whitacre announced plans to make DSL available to nearly 80% of SBC's customers in 2004, compared to 67% today. Other highlights of Whitacre's address include:
- The Echostar partnership is on track to launch a co-branded "SBC dish" satellite TV service in early 2004, which Whitacre would make SBC the first to offer a "quadruple play" or voice, wireless, DSL and video. Notably, Whitacker said its special relationship with EchoStar enables it to "own the customer," unlike other satellite resale agreements by SBC's peers.
- Whitacre described the FCC's recently issued Triennial Review order as a "huge disappointment." He said the FCC order "didn't change much on UNE-p and it didn't do much on the broadband side either." He complained that the FCC's attempt to set a national broadband plan was "muddled" and really does not provide any new incentives for SBC. As a result, he predicts further job losses at SBC but did not provide specific numbers of anticipated cuts.
- As for the recent joint FTTP RFP, Whiteacre estimates that the costs will probably be above $2,000 per home (equipment plus trenching). Due to this cost and to regulatory requirements to preserve some level of competitor access on these new lines, Whiteacre said fiber-to-the-home is not in its plans, except in certain new deployments. Whiteacre said he just "doesn't see the incentive for FTTP" and that even a drop of several hundred dollars in equipment prices would be unlikely to change his mind.
- Access line losses are slowing down due to success with long distance + local bundling.
- SBC is preparing to launch a major push into national, enterprise data services, pending long distance approvals in the mid-West
- Whiteacre said poor overall economic conditions continue to hamper growth. SBC's workforce is expected to continue to decline as a result of lower demand in the core business and cost-cutting efforts.
- Capital expenditures are expected to be approximately $5 billion in 2003 and below that level in 2004.
http://www.sbc.com
09-Sep-03
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