AT&T progressing on 2.3 GHz LTE rollout, targets all-IP future

AT&T (NYSE:T) will deploy LTE services on its 2.3 GHz Wireless Communication Service (WCS) spectrum next year, using it for paired spectrum operations rather than just downlinks, said John Donovan, senior executive vice president of AT&T's technology and network operations.

The operator has had to wait for standard specifications to be released for using LTE over its WCS spectrum, which it cobbled together via multiple purchases. However, significant standards milestones were achieved during 2013, said Donovan, who made his comments during the Citi 2014 Internet, Media & Telecommunications Conference Monday in Las Vegas.

"We're right on track and feel very good about where are with the WCS spectrum," he said, noting the company has already gotten chipset designs that it thinks will be satisfactory.

Though there had been some discussion about AT&T using the 2.3 GHz spectrum solely for downlink services, Donovan confirmed that the operator now intends to use it for paired spectrum operations.

AT&T is consuming spectrum at a rate of 10 MHz every 12 months in certain leading, data-intensive markets. "Spectrum is the lifeblood of our industry. There's never enough at that burn rate for the long-term horizon," Donovan said.

However, the operator believes it has enough spectrum to continue satisfying demand for now, Donovan said, noting AT&T will refarm its HSPA+ spectrum for LTE and will also refarm its 2G spectrum once it shutters GSM services. AT&T expects to turn off 2G GSM service by the start of 2017. 

Further, the operator is preparing to roll out service on the lower 700 MHz D and E Block spectrum that it acquired from Qualcomm (NASDAQ:QCOM). The operator's Chairman and CEO Randall Stephenson has said previously that AT&T will use that spectrum for LTE Broadcast.

In addition, AT&T is on track to announce the first markets where it will offer Voice over LTE and HD Voice early this year, Donovan said, without being more specific. On Monday AT&T announced its first VoLTE-capable phone, the Asus PadFone X, at the 2014 Consumer Electronics Show.

AT&T is transforming itself into a software-based company so it can move more quickly. AT&T has previously set 2020 as its target date to become an all-IP company. In late 2012, AT&T announced Project VIP, in which it laid out a three-year strategic plan to upgrade its wireless and wireline networks and shift more rapidly to an all-IP architecture. "The thing right now that I am personally the most excited about is the architectural shift to go to software-defined networking," Donovan said.

"We think that what's been done in the data center could be done in the network," he added. "It's extremely complex, but the benefits are extraordinary."

AT&T announced earlier on Monday that the company has completed 90 percent of its LTE network buildout. "We'll get the balance done by mid-year," Donovan said.

He noted AT&T is seeing a 50 percent-plus growth rate in mobile data and is committed to staying ahead of demand. But that will require a denser grid, which is why AT&T is focused on rolling out thousands of small cells.

The AT&T executive also took a jab at top rival Verizon Wireless (NYSE:VZ), contending the AT&T network is faster and more reliable than Verizon's. He said that while AT&T has had zero LTE network outages, Verizon has reportedly had seven.

Referencing announcements AT&T made during CES, Donovan recalled that the operator's plan for sponsored data "was inadvertently covered" by the Wall Street Journal during 2012. "We've been working at that for a while," he said.

Sponsored data's three-party transaction process "has opened up a whole bunch of business models," Donovan added.

He also cited AT&T Drive, a new mobile platform for developing LTE connected car services. Donovan said AT&T Drive and AT&T Digital Life, the firm's home security platform, are all about "making the mobile phone the remote control for your entire life."

AT&T "will continue to make investments and really push aggressively into those kinds of services," because they represent the industry's next big growth opportunity, Donovan added.

For more:
- see this release and this release

For more:
AT&T to launch 'Sponsored Data' toll-free data plans
AT&T and partners launch connected car platform and test facility
Stephenson: AT&T would accept limits to spectrum purchases during incentive auctions
AT&T, SiriusXM and Nissan collaborate on connected car initiative
AT&T scores AWS, 2.3 GHz WCS spectrum for LTE
AT&T sets wireless, wireline expansion via Project VIP

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