AT&T Plans to Roll Out 60 MHz of New Spectrum Tied to FirstNet, CFO Says
The launch of FirstNet is moving more quickly than expected, with 11 states and one U.S. territory opting in, AT&T Chief Financial Officer John Stephens said at an Oppenheimer financial conference Tuesday. “The election period has just begun,” he said.…
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“It’s very early and we are pleased.” AT&T had wireless communications service and AWS-3 spectrum in which it hadn’t deployed service, he said. The plan is to use that spectrum with 20 MHz of 700 MHz spectrum from FirstNet to deploy three 2 by 10 channels at the same time, he said. AT&T will use the $6.7 billion it's getting from FirstNet to cover the costs. “It’s very efficient -- pay for one tower climb and get three units of spectrum put into service,” he said. “You do it on a national basis.” The 60 MHz is on top of 100 MHz of low- and mid-band spectrum already in use in AT&T’s network, but it will start at LTE speeds and eventually move to 5G, Stephens said. Parts of the network are still 3G, he noted. The carrier plans to start construction as soon as possible in states that opted in, he said. Most of the buildout will be done within three years, he predicted: “It’s a very efficient build.” AT&T still expects to close its buy of Time Warner this year, Stephens said. “Things are going as expected,” he said. “We are in the process of working with the DOJ.” AT&T projects $1 billion in savings through the transaction, he said. Stephens also offered a network virtualization update. At the end of last year, 34 percent of AT&T’s network functions were virtualized, at 40 percent at the end of the June, he said. AT&T expects to be at 55 percent by the end of this year and 75 percent by 2020, he said. Stephens said AT&T’s dividend is up to the board, but he doesn't expect major changes. The board “has been speaking pretty clearly [on dividends] for close to 35 years,” he said. Many who hold AT&T stock “really value” the dividend, he said. Last week, Windstream eliminated its dividend in favor of buying back stock, sending its shares down along with some other telcos (see 1708030010).