AT&T CEO John Stankey (pictured) provided a different take on the convergence of mobile and fibre-based services during the company’s Q2 earnings compared to Verizon CEO Hans Vestberg.

In Verizon’s recent Q2 earnings call, Vestberg stated while his company sees an uptick in wireless and broadband convergence, the operator will wait and see if customers really want a converged product.

“I don’t think we’re going to see the European levels here because of the nature of the market,” Vestberg explained. “But as we move further into convergence, we will be very well positioned with the products we’ll have.”

AT&T’s Stankey meanwhile seemed more bullish, stating on its earnings call the US operator has passed close to 28 million consumer and business locations with fibre and is well on track to meet its goal of more than 30 million locations by the end of 2025.  

AT&T added 419,000 post-paid subscribers in the quarter to bring its total to 768,000. It reported 239,000 fibre broadband net additions.

“We believe the success of our fibre business is driving growth in mobility and vice versa as consumers increasingly prefer to purchase mobility and broadband together as a converged service,” Stankey said.

He noted nearly four out of every ten households that subscribe to its fibre broadband service also pick the operator as their wireless provider.

“As a result, our share of post-paid phone subscribers within the AT&T fibre footprint is about 500 basis points higher than our national average,” Stankey explained.

Stankey said AT&T can achieve penetration milestones faster for its fibre business, especially when compared to fibre operators that do not operate wireless networks.

“A key reason for this strong performance is our ability to sell fibre to our mobile customers,” he said.

The CEO said AT&T is in a “race to convergence” because it creates lifetime values with customers.

“Why a race to convergence? Because that’s a good way to make money, and it’s a good way to keep customers in the fold. I hope not everybody believes that’s the right strategy.”

While AT&T’s convergence strategy began with a focus on its own fibre footprint, Stankey said the company sees “attractive opportunities to expand the availability of AT&T fibre and our converged offers outside of it,” which could include scaling its Gigapower JV.

Open RAN + fibre
Stankey stated AT&T’s decision to embrace open RAN is based on “busting open the smaller cell structure to get more innovation, more providers and how to then layer that on top of the fact that we’re putting denser fibre reaches into our network”.

“That allows for a more efficient growth of capacity as we move forward,” Stankey said.

AT&T is currently relying on Ericsson as its open RAN vendor, but Stankey mentioned a “multi-vendor strategy” going forward, without naming any specific vendors.

“Getting those [open RAN] interfaces open and getting a multi-vendor environment and then using our dense fibre assets that we’re deploying is a match made in heaven,” he stated.

Q2 numbers
AT&T reported revenue of $29.8 billion, which is flat year-over-year, and net income of $3.9 billion compared to $4.8 billion. It posted mobility revenue of $16.3 billion, up 3.4 per cent.

The operator’s fixed wireless access service netted 139,00 net additions (bringing its FWA customer base to nearly 350,000) across parts of 137 markets. It notched 35,000 prepaid net adds in the quarter.