AT&T could push fiber goal beyond 30M with help from infra bill

AT&T has already set an ambitious goal to double its fiber footprint to 30 million locations by the end of 2025. But during a Goldman Sachs investor conference, CEO John Stankey hinted the passage of an infrastructure bill currently being weighed by Congress could spur it to push even further.

The infrastructure bill in its current form would allocate a total of $65 billion for broadband, including $42.45 billion for a new deployment program focused on connecting un-and underserved areas. Stankey said if the bill becomes law “that’s going to change the landscape of the broadband business in this country. And it will also change my posture and point of view of where we should be playing as a company.”

“I would lean into it,” he continued, adding that in that scenario he’d probably say “30 [million] isn’t the right number.”

Stankey explained AT&T’s current 30 million target is focused on serving locations that offer attractive returns in the existing environment. But he acknowledged “there’s probably places that we can go where we haven’t defined the model…We can possibly do something either with partners or under different models where it may not look like an effective return today but circumstances may change that in fact make it an effective return.”

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The CEO previously hinted in May that AT&T could go beyond its 30 million fiber target even absent the infrastructure bill, as vendor costs improve and uptake of its service increases. He reiterated that sentiment, stating “I’ve kind of put that out as a challenge to the management team to say the only thing that stands in the way between you doing 30 million and doing more is your execution and performance.”

Supply chain

So far, things have been off to a rocky start. Last month, AT&T CFO Pascal Desroches revealed the operator expected to miss its 2021 fiber deployment target by approximately 500,000 locations due to supply chain issues. Stankey shed additional light on the situation, stating it’s facing “what’s probably effectively about a 90-day delay for us to hit those numbers.”

He noted the problem was caused by a mix of staffing and raw material shortages encountered by AT&T’s fiber manufacturing partner but added those have largely been resolved.

“Our deliveries over the last 30 days have tracked to what our expectations are. So, we feel like we're through that dynamic right now,” he concluded.