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AT&T CEO Stankey argues scale matters in satellite debate
AT&T CEO John Stankey (pictured) outlined the advantages he sees over the potential threat of a direct-to-device (D2D) service by SpaceX during a Q3 earnings call, which included much more low-band spectrum, a scaled network and the ability to penetrate buildings with its mobile service.
During yesterday’s (20 October) SpaceX earnings call, president Gwynne Shotwell said the low-band spectrum her company agreed to buy earlier this month can be paired with Wi-Fi for mobile connectivity indoors, along with devices in towers and Starlink installs across businesses and consumers’ homes.
Shotwell said Wi-Fi accounts for the vast majority of mobile connectivity, estimating its share at between 85% and 93% without providing details on how portals and passwords will be used.
“There are significant loads, even with robust Wi-Fi networks, that are out there,” AT&T’s Stankey countered on the operator’s own financial call today (21 October). “I think it takes a lot of years and a huge level of investment to get to the kind of performance levels that customers have become accustomed to in scaled networks that are running on the infrastructure that most of the incumbent providers have today.”
SpaceX has touted the nationwide low-band spectrum portfolio it bought from Grain Management as the means to enable in-building penetration for its D2D service, which Musk said yesterday will generate billions of dollars in revenue on a yearly basis.
“I wouldn’t over-rotate on what I would call one carrier of low-band spectrum,” Stankey said. “Let’s put this in perspective.”
By contrast, Stankey said AT&T operates six to eight carriers of low-band spectrum, deploying it not only at macro sites but also across every indoor building system in high-rises, hospitals and stadiums.
“We’ve got the scale where the scale matters,” he said. “98% of the traffic is where we’ve already built and where we already have capabilities and customers have become accustomed to a level of service that is pretty high.”
He added: “I feel really good about where we’re at.”
Q3 metrics
AT&T revenue grew 5.3% to $32.3 billion in the quarter ended 30 September, up from $30.7 billion a year ago.
Total service revenue increased 3.8%, its best consolidated growth in more than four years, reaching $26.3 billion. Wireless, fibre and the Lumen mass markets fibre business all contributed. Equipment revenue rose 12.1% year-on-year to $6 billion.
Income from continuing operations came in at $1.3 billion compared with $9.7 billion in the year-ago quarter, which benefited from the DirecTV transaction gain.
Post-paid phone net adds were 379,000, down 6.4% from 405,000 a year ago, with churn flat. The post-paid phone base now stands at 75.283 million, up 2%. Prepaid phone lost 21,000 customers.
Consumer and business internet net additions rose 25.4% to a record 769,000 from 613,000 a year earlier. Fibre net additions increased to 442,000 from 309,000, while fixed wireless access additions climbed to 327,000 from 304,000.
Total internet connections increased 29.3% to 16.2 million. Combined with phone additions, this pushed AT&T’s Advanced Connectivity net additions above 1 million for the second consecutive quarter. Advanced Connectivity service revenue reached $23.9 billion, up 6.1%.
AT&T added approximately 350,000 converged customers, with 42.8% of households using its fibre or Internet Air service also taking its mobile service.
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