AT&T Gets Into Satellite Broadband Business

AT&T Inc. on Monday announced its plans for entering the satellite broadband business.

The former SBC Communications Inc. already owned spectrum licenses but had done little with them. During a speech to the Detroit Economic Club, Ed Whitacre, AT&T’s chairman and CEO, said the carrier later this month will start offering satellite broadband in select rural markets.

The news came as no surprise to Sam Greenholtz, a principal analyst for Telecom Pragmatics.

“They’re trying to make it sound like they’re going out of the way to do something and, in reality, this was planned all along … to get to the rural customers,” he said. “I think it has more PR spin on it than it does news.”

Greenholtz said AT&T likely is making the announcement to get the attention and support of regulators and politicians. Still, he added, rolling out satellite broadband to hard-to-reach areas makes economic sense and provides an option for subscribers who otherwise will be ignored, he said.

AT&T has partnered with privately held, Colorado-based WildBlue and will rebrand that company’s services. AT&T said it will offer satellite broadband in local markets where its DSL service is not available. Rural subscribers will have three service options, with packages ranging from $49.95 to $79.95 per month, and broadband speeds reaching up to 1.5mbps downstream and up to 256kbps upstream, AT&T said.

In his speech, Whitacre also said AT&T plans to make its Project Lightspeed video services available within three years to more than 5.5 million low-income households. The announcement comes as regulators and cable companies have expressed concerns that telcos entering the video market only want to target affluent markets. Customers will have access to AT&T’s U-Verse products, which include voice, video, high-speed Internet access and, later, VoIP services.

Finally, Whitacre also said AT&T is expanding its WiMAX and other fixed wireless efforts. The carrier intends to start new deployments later this year in Nevada and Texas. AT&T already has test deployments in Alaska, Georgia and New Jersey.

AT&T Inc. www.att.com
Telecom Pragmatics  www.telecompragmatics.com
WildBlue www.wildblue.com

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