AT&T wants to cut its copper footprint in half by 2025

AT&T executives revealed the operator is working to reduce its copper footprint by 50% by 2025, planning to reinvest savings from the decommissioning effort to grow its fiber and 5G networks.

Jeff McElfresh, CEO of AT&T’s Communications division, said during an investor day event the move will allow the operator to rationalize a cost base totaling $6 billion. Though the project is still in its early stages, AT&T has already dismantled over 9,000 network elements and reduced over 4 billion in annualized kilowatt hours to date.

“These actions not only drive cost efficiencies but they’re opening up more opportunity that is meaningful for our future. Our teams in these network areas are able to reinvest their time towards building out our next generation fiber and 5G networks, the growth platform for the future,” he said.

McElfresh declined to say what percentage of the overall copper network has been taken offline thus far, but stated activity on this front will ramp “10x” in 2022 and “reach a peak probably by the year 2024.”

Initial decommissioning work has focused on areas where AT&T sees little or no demand for copper service from customers, he said. It is also sunsetting copper in areas where it’s rolling out fresh fiber infrastructure. Thus far, he said AT&T hasn’t seen a need to forcibly migrate customers. 

“That motivation is occurring on their own. Customers are recognizing they need this capability that fiber brings,” McElfresh explained.

Around 20% of AT&T’s network footprint, or about 16 million locations, is served by fiber today. By 2025, McElfresh said AT&T is aiming to boost that figure to cover 75% of its network with either fiber or 5G. The operator plans to rollout wireless-based "catch products" in former copper markets where it doesn't deploy fiber to serve customers who might otherwise be left out in the cold due to its copper retirement plan, he added.

AT&T CFO Pascal Desroches noted it plans to spend between $3 billion and $4 billion per year on fiber as it works toward a previously announced target of covering a total of 30 million homes with the technology by 2025. The operator added 2.6 million new fiber locations in 2021. Going forward, executives said AT&T expects to add between 3.5 million and 4 million new fiber passings each year on the way to its goal.

Jenifer Robertson, AT&T EVP and GM of Mobility, said the operator is already seeing strong performance from its early fiber builds. Approximately two-thirds of net additions are new to AT&T broadband, she said, adding 12-month penetration rates are roughly double the 12% it has achieved historically in the same amount of time.

In addition to boosting AT&T’s broadband business, Robertson said the fiber rollout is expected to be a boon for wireless.

“We’ve proven we can grow wireless relationships where we have fiber. In fact our wireless market share is 50% higher in our fiber footprint,” she said. “If you assume about three postpaid phone users per household, it’s clear there’s significant yield here, especially when you consider we have 4 million fiber households where we still don’t have wireless.”