At AT&T, broadband continues to shrink

Om Malik — Tue, 24 Jul 2012 12:47:51 +0000

AT&T, like its main rival, Verizon, is all about the wireless these days. It can charge a lot more for wireless bandwidth. It can get away with terrible user experience. It doesn’t have to worry about network neutrality and it has customers who are addicted to mobile broadband on their iPhones. And they don’t even have to work hard at snagging these new customers – AT&T activated 3.7 million iPhones, of which 22 percent are new to AT&T – in the second quarter of 2012 alone.

DSL is dying

It is not surprise that like Verizon, Ma Bell isn’t losing much sleep over its broadband business that can be described as plodding at best and meh at worst. Sure, the company is adding somewhat faster U-Verse connections, but they are losing the classic DSL customers faster.

During the past three months, the company lost 96,000 net broadband connections versus 13,000 connections it lost during the first three months of 2012. At the end of the first six months of 2012, AT&T had 14.517 million broadband connections – flat when compared to 14.520 million connections it had during the first six months of 2011.

Sure, they are getting traction for their U-Verse broadband service, but even that is nothing to write home about. AT&T had about 6.8 million U-Verse subscribers (that includes TV and high-speed Internet.) AT&T U-verse High Speed Internet delivered a second-quarter net gain of 553,000 subscribers to reach a total of 6.5 million. Frankly compared to the speeds offered by cable broadband, U-Verse feels pokey, but hey that is just me.

However, classic DSL continues to die. Given that, AT&T lost 96,000 net subscribers in the quarter. So, while DSL might have made the company a fierce competitor to cable companies in the early days, these days, AT&T is just busy counting the dollars from wireless.

Other relevant bits from AT&T’s press release:

More than 50 percent of U-verse broadband subscribers have a plan delivering speeds up to 12 Mbps or higher, up from 39 percent in the year-ago quarter.
About 90 percent of new U-verse TV customers took AT&T U-verse High Speed Internet in the second quarter and about half of new subscribers took AT&T U-verse Voice.

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At AT&T, broadband continues to shrink