Showing posts with label ATT. Show all posts
Showing posts with label ATT. Show all posts

Monday, November 20, 2017

U.S. DoJ moves to block AT&T + Time Warner merger

The U.S. Department of Justice will file a legal case to block the proposed AT&T + Time Warner merger.

It has been nearly 13 months since AT&T first announced its intention to acquire Time Warner. The companies said the reason for the deal is to combine Time Warner's vast library of content and ability to create new premium content with AT&T's extensive customer relationships, world’s largest pay TV subscriber base, and leading scale in TV, mobile, and broadband distribution.

Time Warner, which was formed in 1990 through the merger of Time Inc. and Warner Communications, encompasses a number of premium media properties, including HBO, New Line Cinema, Turner Broadcasting System, The CW Television Network, Warner Bros., CNN, Cartoon Network, Boomerang, Adult Swim, DC Comics, Warner Bros. Animation, Castle Rock Entertainment, Cartoon Network Studios, Esporte Interativo, Hanna-Barbera Productions, Warner Bros. Interactive Entertainment. It also owns 10% of Hulu.

In response to the DoJ suit,  David R. McAtee II, Senior Executive Vice President and General Counsel, AT&T stated: “Today’s DOJ lawsuit is a radical and inexplicable departure from decades of antitrust precedent. Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market. We see no legitimate reason for our merger to be treated differently. Our merger combines Time Warner’s content and talent with AT&T’s TV, wireless and broadband distribution platforms. The result will help make television more affordable, innovative, interactive and mobile. Fortunately, the Department of Justice doesn’t have the final say in this matter. Rather, it bears the burden of proving to the U.S. District Court that the transaction violates the law. We are confident that the Court will reject the Government’s claims and permit this merger under longstanding legal precedent.”

MEF17: 2018 is about creating intelligence at the edge



2017 was all about virtualizing the edge and 2018 will be about creating intelligence at the edge and expanding it to the cloud, says Josh Goodell, VP, Intelligent Edge, AT&T. Application-aware #SD-WAN capabilities will make the extensible platform real.

See video:  https://youtu.be/LrY_Vd8mfTQ


Sunday, November 19, 2017

State of Georgia signs on to FirstNet

The state of Georgia has accepted the FirstNet and AT&T plan to deliver a wireless broadband network to the state's public safety community.

Under the public/private partnership, first responders in Georgia, including fire, police, EMS and other public safety workers, will have access to quality of service and priority to voice and data across the existing nationwide AT&T LTE network.  Preemption for primary users over the AT&T LTE network is expected by year-end.

"FirstNet will provide the coverage, experience and next-generation technologies our first responders need and deserve," said Bill Leahy, president of AT&T Georgia. "AT&T is proud to work with Governor Deal to bring this dedicated, interoperable public safety broadband network to Georgia, and connect its public safety community to advanced technologies that will help save lives."

Shell picks AT&T for global networking services

Shell has selected AT&T to provide strategic services like network management and integration, global voice and data services, security, video and collaboration solutions. AT&T will deliver network capabilities and network integration services across multiple vendors that are designed to support virtualized services, cloud strategy, and hybrid network solutions. The agreement builds an existing relationship spanning the last five and a half years. Financial terms were not disclosed.

“Shell needs global integrated network solutions accessible from just about every corner of the planet. We can offer that. And it’s a task we take seriously,” said Frank Jules, president Global Business at AT&T. “We’re eager to continue the relationship and move forward into new areas of innovation with Shell.”

Thursday, November 16, 2017

AT&T runs with LTE-LAA in Indianapolis

AT&T has deployed commercial LTE-Licensed Assisted Access (LTE-LAA) in downtown Indianapolis.

LAA offers theoretical peak speeds of up to 1 Gbps. In previous field tests, AT&T observed actual peak wireless speeds of 979 Mbps.

The Samsung Galaxy Note8 supports LTE-LAA.

AT&T describes LTE-LAA as a stepping stone to 5G, which it aims to commercialize as early as late 2018. The progression includes upgrading cell towers with 5G Evolution technologies like 256 QAM, 4x4 MIMO and 3-way carrier aggregation.

Wednesday, November 15, 2017

AT&T suffers outage

Some of AT&T's U.S. customers experience a network outage. Reported problems involved mobile and well as Internet service.

AT&T's customer care department advised users to restart their phones to resolve the problem.


Tuesday, November 14, 2017

AT&T extends its 5G trial to Minneapolis

AT&T will extend its 5G Evolution trial in parts of Minneapolis in the coming months, including near the host stadium for the upcoming Super Bowl.

Minneapolis is one of 20 markets where the technology trial is expected to begin by the end of the year.

This includes upgraded cell towers with network upgrades that include ultra-fast LTE Advanced features like 256 QAM, 4x4 MIMO, and 3-way carrier aggregation.

“We’re excited about launching this new wireless network in Minneapolis in the coming months as we move towards standards-based mobile 5G,” said Marachel Knight, senior vice president, Wireless Network Architecture and Design. “The upgrades we’re making today in Minneapolis are the foundation for the future of next generation connectivity in this city.”

Monday, November 13, 2017

AT&T and Verizon strike a deal to build cell towers with Tillman

AT&T and Verizon reached an infrastructure sharing agreement in which they will work with a third party, Tillman Infrastructure, to build hundreds of cell towers.

Tillman will build, own and operate the towers, small cells and smart cities infrastructure. AT&T and Verizon have committed to leasing and co-anchoring the co-located towers. Construction will begin in Q1 2018. Financial terms were not disclosed.

The three companies see the potential for significantly more new site locations in the future.

“We continue to focus on technology innovation and investing in the latest software platforms to provide the best possible customer experience on our network,” said Nicola Palmer, Chief Network Officer for Verizon Wireless. “At the same time, it is imperative to reduce operating costs. We are reviewing all of our long-term contracts as they come up for renewal and we are excited to develop new vendor partners to diversify our infrastructure providers.”

“We need more alternatives to the traditional tower leasing model with the large incumbents. It’s not cost-effective or sustainable. We’re creating a diverse community of suppliers and tower companies who will help increase market competition while reducing our overhead,” said Susan Johnson, SVP of Global Supply Chain, AT&T. “We look forward to working with Verizon as we establish site locations and sign new lease agreements with additional suppliers in the coming years.”

“Tillman is excited about the opportunity to work with AT&T and Verizon in order to further develop the cell tower model of the future,” said Suruchi Ahuja, CFO of Tillman Infrastructure. “Over the past year we have built a strong team at Tillman and are committed to rapidly building a leader in wireless infrastructure in the U.S. in order to best serve carriers and the broader communities in which we will enable connectivity.”

Thursday, November 2, 2017

AT&T says FirstNet now elected in half of all states

AT&T cited significant traction for the FirstNet public safety network: the governors of 29 American states and territories have made the decision to opt in to the FirstNet network. An opt-in decision allows first responder agencies to sign-up for FirstNet, giving them priority access to voice and data across the existing nationwide AT&T LTE network.

“Just within the past couple of months, this country has experienced a number of tragedies. And no matter the life-threatening event, our first responders were there for us. It’s our responsibility to make sure the communications capabilities they need are there, too,” said Mike Poth, CEO of FirstNet. “We applaud these 29 governors for giving their first responders access to the cutting-edge tools they need to support their heroic efforts.”

“The needs of public safety demand more than what commercial offerings provide today. FirstNet will be a force for good, forever changing the way first responders think about and use communications,” said Chris Sambar, senior vice president, AT&T – FirstNet. “We’re honored to have more than half the country put their trust in us to deliver this game-changing platform for public safety. That trust is not misplaced. Our commitment to this community as well as what we intend to deliver is clear and unwavering.”


  • In April, AT&T was awarded a 25-year contract by the First Responder Network Authority (FirstNet) to build and manage the first broadband network dedicated to America's police, firefighters and emergency medical services (EMS) that will cover all 50 states, 5 U.S. territories and the District of Columbia, including rural communities and tribal lands.

    The communications infrastructure to be provided by AT&T will support the millions of first responders and public safety personnel nationwide. The public-private infrastructure investment is expected to create around 10,000 U.S. jobs over the next two years, with the roll-out scheduled to begin later in 2017.

    For the project AT&T will create a national IP-based, high-speed mobile communications network for first responders designed to improve rescue and recovery operations, more effectively connect first responders to the information they need, support public safety initiatives based on IoT and smart city solutions and enable the use of new capabilities such as wearable sensors and cameras.

Monday, October 30, 2017

AT&T moves Acumos into open source as an AI-enabling platform

AT&T, in collaboration with Tech Mahindra, is backing an open source artificial intelligence (AI) platform called Acumos that can be used to build smart applications.

Acumos, which will be hosted by The Linux Foundation, makes it easy to build, share and deploy AI applications. More specifically, it provides the capability to edit, integrate, compose, package, train and deploy AI microservices. Acumos will provide a marketplace for accessing, using and enhancing those applications.

“Our goal with open sourcing the Acumos platform is to make building and deploying AI applications as easy as creating a website,” said Mazin Gilbert, vice president of Advanced Technology at AT&T Labs. “We’re collaborating with Tech Mahindra to establish an industry standard for AI in the networking space. We invite others to join us to create a global harmonization in AI and set the stage for all future AI network applications and services.”

“We’re opening up AI. We’re focusing on the telecommunication, media and technology spaces, starting with the network. The platform will be available to anyone and the more users who adopt it, the better it will get,” added Gilbert.

AT&T said the Acumos platform is built on open source technologies and can be powered by AT&T Indigo, its next-generation platform for delivering a seamless network experience.

Earlier this year, AT&T moved its ECOMP into the open source curation of The Linux Foundation under the newly launched ONAP project. With Acumos, AT&T said it was acting to place the initial framework into open source as quickly as possible.

AT&T expands business cloud networking with AWS

AT&T announced an expansion of its alliance with Amazon Web Services (AWS) by expanding its business cloud networking solutions and focusing on security and IoT.

Highlights:

  • FlexWare: AT&T is expanding the reach of how AWS customers can access the cloud more securely. AT&T FlexWareSM is now cloud-ready, and can directly—and more securely—connect to AWS. This will help businesses be more agile with edge computing. 
  • Private Mobile Connect: With AT&T Private Mobile Connect, AWS customers can more securely access AWS from a mobile device.  Workloads are moved from the mobile device, via the public network or through NetBond for Cloud, to AWS for all customers. 
  • Cybersecurity: AT&T Threat Manager will allow AWS customers to proactively identify data patterns and threat activity that could affect their network and cloud environment. AT&T analyzes the traffic in near real-time coming in and out of a device, connection or application. AT&T can then identify abnormalities to help prevent, detect and respond to vulnerabilities. 
  • Internet of Things: Earlier this year AT&T introduced a dedicated IoT Starter kit, powered by AWS. The kit lets developers build their own solutions using AT&T IoT and AWS IoT. Developers can also use AT&T’s highly secure network and get application-level security. The companies are currently exploring options to bring AWS Greengrass to the AT&T FlexWare platform, which would enable edge computing to open up new IoT opportunities for businesses.

AT&T also offers Cloud Transformation Consulting services.

Sunday, October 15, 2017

AT&T cites financial impact of hurricanes, video subscriber losses

AT&T said damage caused by recent hurricanes and the earthquake in Mexico will decrease its Q3 2017 consolidated revenues nearly $90 million and its reported pre-tax earnings about $210 million, or $0.02 per diluted share. In an SEC filing, AT&T said it continues to assess damage to its network and that further charges in Q4 are likely.

It should be noted that AT&T's network in Puerto Rico completely collapsed following Hurricane Maria on September 20 (as did the mobile networks of four other carriers serving the island), and that as of October 14 only partial services have been restored and that many cell towers and backhaul links remain offline.

In its SEC filing, AT&T also noted that it lost about 90,000 video subscribers in Q3 due to heightened competition in traditional pay TV markets and over-the-top services, hurricanes and stricter credit standards. AT&T's own over-the-top DIRECTV NOW service added 300,000 users.

On the positive side, AT&T continued to expand its postpaid smartphone base even as it had nearly 900,000 fewer handset equipment upgrades than in the year-ago third quarter.

Saturday, October 14, 2017

AT&T wins 2017 Sustainability award

AT&T was awarded the 2017 Sustainability Initiative of the Year title by The Business Intelligence Group. The award recognized AT&T for its 10x Carbon Reduction Goal.

The only other tech company winning an award this year was Oracle, which was commended for its California Water Conservation Project.








AT&T Aims for Carbon Savings 10X By 2025

AT&T has set a goal to enable carbon savings 10 times the footprint of its operations by 2025.

The gains will be achieved by enhancing the efficiency of its network and delivering low-carbon customer solutions.

To be achieved by 2025, additional goals focus on the communities in which AT&T operates and the company's supply chain:

  • AT&T will invest resources, develop initiatives and collaborate with stakeholders to close the skills gap, by increasing the number of Americans with high-quality, post-secondary degrees or credentials to 60 percent.
  • AT&T will work with its industry peers to develop and promote adoption of sustainability metrics that will transform the environmental and social impact of technology supply chains.

Thursday, October 5, 2017

AT&T releases its Virtual Optical Line Termination Hardware Abstraction to ONF

AT&T is contributing its Virtual Optical Line Termination Hardware Abstraction (VOLTHA) code into the Open Networking Foundation (ONF).

VOLTA provides the framework behind AT&T's XGS-PON access network in the cloud. AT&T is currently performing proof-of-concept testing of VOLTHA in its labs and are planning to deploy XGS-PON field trials before the end of 2017.

AT&T described its decision to contribute its VOLTHA code as one more step in its commitment to move toward open source software and SDN/NFV frameworks.





AT&T to launch software-based 10G XGS-PON trial

AT&T announced it will conduct a 10 Gbit/s XGS-PON field trial in late 2017 as it progresses with plans to virtualise access functions within the last mile network.

The next-generation PON trial is designed to deliver multi-gigabit Internet speeds to consumer and business customers, and to enable all services, including 5G wireless infrastructure, to be converged onto a single network.

AT&T noted that XGS-PON is a fixed wavelength symmetrical 10 Gbit/s passive optic network technology that can coexist with the current GPON technology. The technology can provide 4x the downstream bandwidth of the existing system, and is as cost-effective to deploy as GPON. As part of its network virtualisation initiative, AT&T plans to place some XGS-PON in the cloud with software leveraging open hardware and software designs to speed development.
AT&T has worked with ON.Lab to develop and test ONOS (Open Network Operating System) and VOLTHA (Virtual Optical Line Terminator Hardware Abstraction) software. This technology allows the lower level details of the silicon to be hidden. AT&T stated that it has also submitted a number of open white box XGS OLT designs to the Open Compute Project (OCP) and is currently working with the project to gain approval for the solutions.

The company noted that interoperability is a key element of its Open Access strategy, and prompted the creation of an OpenOMCI specification, which provides an interoperable interface between the OLT and the home devices. This specification, which forms a key part of software-defined network (SDN) and network function virtualisation (NFV), has been distributed to standards and open source communities.



  • AT&T joined OCP in January 2016 to support its network transformation program. Earlier this year at the OCP Summit Edgecore Networks, a provider of open networking solutions and a subsidiary of Accton Technology, announced design contributions to OCP including a 25 Gigabit Ethernet top-of-rack switch and high-density 100 Gigabit Ethernet spine switch. The company also showcased new open hardware platforms.
  • At the summit, Edgecore displayed a disaggregated virtual OLT for PON deployment at up to 10 Gbit/ based on the AT&T Open XGS-PON 1 RU OLT specification that was contributed to the OCP Telco working group.
  • Edgecore's ASFvOLT16 disaggregated virtual OLT is based on the AT&T Open XGS-PON 1 RU OLT specification and features Broadcom StrataDNX switch and PON MAC SOC silicon, offering 16 ports of XGS-PON or NG-PON2, with 4 x QSFP28 ports and designed for next generation PON deployments and R-CORD telecom infrastructure.

Thursday, September 28, 2017

AT&T expands its Fixed Wireless Internet rollout

AT&T is expanding its Fixed Wireless Internet service for rural and underserved locations to 9 new states: Arkansas, California, Illinois, Indiana, Kansas, Michigan, Ohio, Texas and Wisconsin.

This brings the rollout to 18 states, for a total of over 160,000 locations.  AT&T is aiming to offer the Fixed Wireless service in over 400,000 locations by the end of this year, and over 1.1 million locations by 2020.

AT&T Fixed Wireless Internet delivers download speeds of at least 10 Mbps and upload speeds of at least 1 Mbps. The LTE connection comes from a wireless tower to a fixed antenna on customers’ homes or businesses.

“For many rural families and communities, the introduction of this service from AT&T will mark a new era of increased broadband speeds and access to cheaper and more diverse content.” said Bret Swanson, president, Entropy Economics.  "AT&T's move into these new communities will also yield additional economic benefits and can help create new jobs.”

Wednesday, September 13, 2017

AT&T Extends its NetBond between clouds

AT&T NetBond is introducing a "cloud-to-cloud" feature that efficiently moves workloads across highly secure connections between public, private and hybrid cloud services in the NetBond for Cloud ecosystem.

AT&T NetBond for Cloud promises scalable network connectivity for efficient traffic flow between clouds. AT&T said that with this feature, each ecosystem cloud – private or public – can now be efficiently connected to another and remain off internet. Customers can easily manage connections between clouds by using the digital AT&T cloud portal. Network managers no longer have the time-consuming manual task of working with multiple cloud providers to build connection points individually – they can now create or change connectivity configurations within minutes.

“Many businesses use 3 or more clouds. And they’re often a mix of public, private or hybrid,” said Roman Pacewicz, Chief Product Officer, AT&T Business. “No matter the combination, it can be challenging if cloud environments have to mix. An important part is enabling efficient and highly secure network connections that help customers move their workflows between cloud endpoints. With NetBond for Cloud, it’s simple.”

Security options are available to manage the flow between end users and applications that can be used with the cloud to cloud feature. Our NetBond for Cloud service is fully off-internet, providing simple, highly secure access to industry-leading cloud services from virtually anywhere.

http://att.com/netbond


Monday, September 11, 2017

AT&T Tests Single Wavelength 400G Ethernet

AT&T completed testing a single-wavelength 400 gigabit Ethernet (GbE) circuit across its production network.

The multi-step trial used open-sourced white boxes to act as network equipment. AT&T said this aligns with its move toward an open, software-centric network.

“Introducing 400 GbE is a natural next step. Customer demands have shifted to faster speeds, more video-centric content and cloud integration,” said Roman Pacewicz, chief product officer, AT&T Business.

“This industry-first also aligns with our shift toward an open and software-centric network. Utilizing open-source controller technology, the end-to-end service transported across the AT&T OpenROADM metro network – using optical gear from Ciena, a developer of next-generation coherent optical solutions – provides further flexibility and cost-effective services for customers. Prior to this successful trial, all other field demonstrations have required multiple wavelengths to create a 400 GbE connection."

http://www.att.com

In October 2016, AT&T announced plans to conduct 400 Gigabit Ethernet testing in 3 phases:

  • Phase 1: Will use optical gear from Coriant to carry a true 400GbE service across a long-distance span of AT&T global backbone from New York to Washington, demonstrating that AT&T’s nationwide software-centric network is 400G-ready.
  • Phase 2: Will trial a 400GbE on a single 400G wavelength across AT&T’s OpenROADM metro network. We’ll use optical gear from Ciena, a developer of next-generation coherent optical solutions, to show the network is ready to transport 400GbE to serve our customers in a metro area.
  • Phase 3: Will test the first instance of a 400GbE open router platform. The “disaggregated router” platform uses merchant silicon and open source software – another industry first.

Wednesday, August 30, 2017

AT&T's fixed 5G trial expands to more cities

In a show of confidence in 5G, AT&T announced the expansion of its fixed wireless 5G trials to business and residential customers in Waco, Texas; Kalamazoo, Michigan; and South Bend, Indiana by the end of the year. Trial participants in the new markets may include universities, hospitals, churches, restaurants, and other small businesses. Participants will be able to stream premium live TV via DIRECTV NOW and experience faster broadband services, all over a 5G internet connection.

AT&T has been running a 5G field trial in Austin, Texas for some time. In June, this trial was expanded to included fixed 5G connections to various types of businesses and residences. The company said this testing reveals insights into millimeter wave (mmWave) performance and propagation, including variance for foliage, building materials, device placement, the surrounding environment and how weather impacts the signal and system. The testing showed speeds up to 1 Gigabit per second and latency rates well under 10 milliseconds for the radio link at customer trial locations in Austin.  AT&T is also conducting outdoor pre-standards mobile 5G testing.

AT&T said that the expanded field testing in Waco, Kalamazoo, and South Bend will increase the number of participants and expand the physical footprint. The company hopes to begin standards based deployment as early as late 2018.

“In Austin, we see all types of weather and substantial foliage,” said Marachel Knight, senior vice president, Wireless Network Architecture and Design, AT&T. “Taking our fixed wireless 5G trials out of the lab and into the real world helps us learn important factors about mmWave and 5G. And in doing so, we’re learning how to better design our network for the future.”

“We’ve been testing and demonstrating 5G technologies with AT&T for over a year and now we’re expanding the scope of our trial to AT&T customers in Waco,” said Joakim Sorelius, head of Product Area Network Systems at Ericsson. “Ericsson is providing an end to end solution that includes new 28GHz radios, virtualized RAN and a full 5G virtualized Core. By testing the technologies in the live commercial-like environment and trialing new 5G use cases together, we are able to gain valuable experience in preparation for commercial deployments based on 3GPP New Radio (NR) technology.”

http://about.att.com/story/att_expanding_fixed_wireless_5g_trials_to_additional_markets.html

AT&T flies drones in Texas to inspect cell towers

AT&T is deploying a fleet of 25 drones to areas in Southeast Texas to inspect cell towers to determine the hurricane's impact on its network.

AT&T said the drones can inspect areas that are still unreachable by cars or trucks because of flooding.

The company is also deploying two Satellite Cell on Wheels (Sat COLTs) in Beaumont, Texas and will stage 12 more in the area to support customers and first responders following the second landfall of Tropical Storm Harvey.

http://about.att.com/newsroom/hurricane_harvey_drones.html

Monday, August 28, 2017

AT&T preps for its mega-merger with Time Warner – Part 2

Part 1 of this article covered operational metrics from AT&T's Q2 2017 financial report. This week, AT&T confirmed that its $109 billion blockbuster acquisition with Time Warner is on track and likely to close by the end of the year. Although the company did not explicitly say that regulators, including the Department of Justice and the FCC, are likely to approve the merger, one can presume that no major issues have been presented yet that could threaten the deal. As the first mega-merger to face review under the Trump Administration, it has not been exactly clear what level of objections such mergers might face, especially under a president who routinely attacks CNN (a Time Warner property) as 'fake news'. Under the Obama administration, AT&T was blocked from acquiring T-Mobile US because the combination was seen as market consolidation that would be detrimental to consumers.

Key terms of the AT&T – Time Warner combination

As a reminder, AT&T officially announced its intention to acquire Time Warner on October 22, 2016. The deal was to be structured as a stock-and-cash transaction valued at $107.50 per share, representing a transaction value of $108.7 billion. The companies said the reason for the deal is to combine Time Warner's library of content and ability to create new premium content with AT&T's extensive customer relationships, world’s largest pay TV subscriber base and scale in TV, mobile and broadband distribution. Time Warner, which was formed in 1990 through the merger of Time Inc. and Warner Communications, encompasses many premium media properties, including HBO, New Line Cinema, Turner Broadcasting System, The CW Television Network, Warner Bros., CNN, Cartoon Network, Boomerang, Adult Swim, DC Comics, Warner Bros. Animation, Castle Rock Entertainment, Cartoon Network Studios, Esporte Interativo, Hanna-Barbera Productions, Warner Bros. Interactive Entertainment. It also owns 10% of Hulu.

The basic idea driving the merger is for Time Warner to act as the content arm for AT&T, providing mobile and fixed broadband line subscribers with valuable material as part of packaged service bundle. Consumers presumably would purchase an AT&T service bundle based on the perceived quality and value of the package rather than simply the lowest price for mobile connectivity. This will allow ARPU to rise and ensure a 'stickiness' factor that goes beyond the latest mobile handset deals, currently a leading cause for subscriber churn.

As a content provider, Time Warner requires far less ongoing capital expenditures than AT&T, which must invest routinely in its infrastructure. AT&T has stated that it expects $1 billion in annual run rate cost synergies within 3 years of the deal closing due to cuts in corporate and procurement expenditures. As there is little overlap between the companies, its not clear where these savings would come from. Time Warner does maintain its corporate headquarters in high-priced Manhattan, but this is where significant content transactions are negotiated and it is unlikely to be relocated to Dallas.

Rising debt load

One outcome of a combined AT&T and Time Warner is that the investor profile will be very different. An article this week by Bloomberg points out that after the merger is completed, AT&T's net debt will rise to $182 billion. This will transform AT&T into a more leveraged conglomerate, putting much greater pressure on how management can use free cash flow from operations. Over the past few years, AT&T has been using significant amounts of cash to buy back its own shares, thus increasing shareholder value. AT&T has also been one the more generous corporations in terms share dividends, reportedly returning 70% of free cash flow last year, or about $11.8 billion, according to Bloomberg. Going forward, more cash will be needed to service the heavier debt load, so we might expect that less cash will be available for dividends or share buybacks.

Betting on bundling

For the deal to be a success, AT&T and Time Warner will have to generate some real synergy in the minds of consumers. With Net Neutrality principles no longer an area of focus for the FCC under the new chairman, Ajit Pai, AT&T will have more leeway in positioning special service packages for its subscribers. For instance, home entertainment services may be the first big use case for 5G networks starting in 2019. A mobile operator such as AT&T might launch a 4K TV package for residential consumers in certain markets. With connection speeds in the hundreds of megabits, AT&T could deliver a strong 5G TV service featuring exclusive shows from HBO or Castle Rock Entertainment, while also including in the package regular LTE smartphone connectivity for all members of a household. Such an offer would be unmatched by rivals such as Sprint and Comcast.

There is already some movement in this direction. AT&T is ready to launch a 5G video trial with DIRECTV NOW service in Austin, Texas. The trial will evaluate how fixed wireless mmWave technology handles heavy video traffic. Previously, AT&T reported that its 5G lab trials were achieving speeds up to 14 Gbit/s and latency of under 3 milliseconds.

But how is video bundling working so far for AT&T? In July 2015, AT&T completed its acquisition of DIRECTV, making it the largest pay TV provider in the U.S. with more than 26 million customers in the U.S. and millions more in Latin America, including Mexico and the Caribbean. The implied total equity value of this deal was $48.5 billion although the total transaction value was $67.1 billion, including DIRECTV's net debt.

The DIRECTV acquisition also brought exclusive, premier content, particularly live sports programming to AT&T, including exclusive pay TV rights to NFL SUNDAY TICKET, ownership of ROOT SPORTS Networks and minority stakes in the Game Show Network, MLB Network, NHL Network and the Sundance Channel. Soon after completing the merger, AT&T began offering bundles combining cellular service, satellite-TV or U-serve TV over FTTH (in certain markets). These offers have been widely promoted via TV and print advertising, in the carrier's retail stores, and in notices to AT&T's millions of mobile users.

On a regular basis since then, AT&T execs have described the merger as a 'hit', citing higher ARPU from consumers who take both services. By Q2 2016, AT&T added nearly 1 million DIRECTV subscribers. In more recent quarters, this moment appears to have stalled, perhaps because the pay TV segment is no longer growing as more cord-cutting consumers look to over-the-top (OTT) services instead of traditional satellite TV subscriptions. Operating metrics for Q2 showed a loss of DirecTV and U-verse TV subscribers in the quarter. However, AT&T’s over-the-top DirecTV Now service continues to add subscribers every quarter and now stands at 491,000 users. So, if hardware-based bundling is capex intensive and no longer growing, perhaps OTT packages are the way to go.


AT&T appointments executives ahead of merger with Time Warner



AT&T has announced a number of executive appointments in preparation for completing its acquisition of global media and entertainment company Time Warner; the transaction is currently under review by the U.S. Department of Justice and competition authorities in certain foreign countries.Effective August 1st, the following executives will assume new positions and continue to report to AT&T chairman and CEO Randall Stephenson:1.  ...



See also