# AT&T’s Shift from Copper to Fiber: Implications for Customers
AT&T, a leading telecommunications provider in the U.S., has revealed its intentions to retire its outdated copper network in favor of contemporary fiber systems. This transition, however, may restrict many rural customers’ choices to options like 5G wireless broadband or satellite services. This decision is part of AT&T’s overarching plan to modernize its setup, reduce expenses, and enhance profitability, but it raises concerns regarding fair access to dependable internet and phone services.
## Transitioning from Copper to Fiber
For decades, AT&T’s copper network has served as the foundation for its landline telephone and DSL internet services, but it is increasingly becoming outdated. Copper lines are susceptible to deterioration, particularly in regions vulnerable to storms, flooding, and theft. Fixing these lines is labor-intensive and expensive, and they are less efficient in terms of energy compared to new alternatives.
In a recent presentation aimed at analysts and investors, AT&T detailed its agenda to eliminate copper-based services throughout the majority of its 500,000-square-mile wireline area by the conclusion of 2029. The company has categorized its territory into two divisions:
1. **Fiber-First Areas:** These more populous zones are where AT&T intends to enhance its fiber network. By the end of 2029, the corporation aims to provide fiber connectivity to 45 million locations, an increase from the existing 29 million.
2. **Wireless-First Areas:** These lesser populated zones make up 50% of AT&T’s land area yet only represent 10% of its customer base. It is considered economically impractical to build fiber in these places. Customers in these areas will be shifted to wireless alternatives like AT&T Internet Air (a 5G-based service) or, in certain circumstances, satellite services.
## Limitations of Fiber Accessibility
AT&T has been upfront that extending fiber to its entire customer base is not financially viable. Susan Johnson, AT&T’s Executive Vice President of Supply Chain and Wireline Transformation, pointed out that in some wire centers (the central offices and surrounding infrastructure), there are as few as four copper customers for every square mile. Providing fiber to such low-density areas wouldn’t yield a reasonable return on investment.
Consequently, AT&T will concentrate its fiber growth in regions where it can maximize profitability. The firm has also collaborated with BlackRock in a joint venture named Gigapower and is partnering with commercial open-access providers to further enhance its fiber reach.
## Alternative Options: Wireless and Satellite
For customers in wireless-first zones, AT&T is advocating its 5G-based home broadband service, AT&T Internet Air, which claims to provide speeds up to 25 times faster than traditional DSL. The company is also transitioning copper-based telephone customers to AT&T Phone-Advanced, a wireless voice service crafted to comply with Federal Communications Commission (FCC) regulations for landline replacements.
Nonetheless, not all customers will have access to these terrestrial wireless options. In some situations, AT&T plans to depend on satellite providers to guarantee that customers maintain access to essential voice and 911 services. This strategy has sparked concerns about the dependability and affordability of satellite internet, especially for low-income and rural households.
## Regulatory Hurdles
AT&T’s move to retire its copper network has been eased by state-level deregulation in 20 out of the 21 states where it operates. Deregulation permits AT&T to halt copper-based services without the obligation to sustain the network for legacy clients. Yet, California has resisted this trend, as the California Public Utilities Commission (CPUC) turned down AT&T’s proposal to end its landline phone commitments, citing worries about the reliability of wireless and VoIP substitutes.
California’s ruling underscores a key conflict in AT&T’s strategy: while the company maintains that copper is obsolete and costly to upkeep, regulators and community members are apprehensive that its alternatives may not deliver the same reliability, especially during emergencies.
## Financial Ramifications
AT&T’s departure from copper is not solely about upgrading its network; it is also a cost-saving initiative. The company dedicates $6 billion each year to maintain its legacy copper network, which it refers to as an “energy hog.” By retiring copper and streamlining its infrastructure, AT&T hopes to enhance its profit margins and allocate more resources to fiber deployment and other ventures.
Additionally, the company intends to capitalize on its decommissioned copper assets by selling the metal and leasing unused central office spaces. These actions are anticipated to generate further revenue and decrease operational costs.
## Effects on Customers
While AT&T’s investors may reap the benefits from the cost reductions and heightened profitability, the repercussions for customers present a more nuanced picture:
– **Urban and Suburban Customers:** Residents in fiber-first areas are set to benefit the most, enjoying access to faster, more reliable internet and phone services.
– **Rural Customers:** Individuals in wireless-first zones may encounter limited choices. Though 5G-based offerings like AT&T Internet Air provide considerable speed improvements over DSL, they may
