AT&T overbuilding LTE in 2011, taking on the Big Apple

AT&T(s T) is building beyond its original 2011 LTE plans, tackling the granddaddy all of markets, New York City, as well as an undisclosed number other markets in the remainder of the year. AT&T had rolled out the new super-fast network by Nov. 20 in 15 markets, completing its 2011 goal. But pressure from Verizon Wireless(s vz)(s vod), which is much farther ahead in its LTE deployment, might have lit a fire under Ma Bell to expand ahead of schedule.

A&T EVP and CFO John Stephens told a UBS analyst conference audience that AT&T’s LTE schedule is being dictated by demand for mobile broadband services – money isn’t the issue – and so far, demand has been high. AT&T expects final-quarter sales of smartphones to break all records, led by new activations of the iPhone 4S. New York will add considerable coverage heft to AT&T’s 4G footprint, though the company isn’t revising its 2011 coverage projections beyond the 70 million pops already stated. AT&T could be planning to meet its goal by building out markets only partially, or it could be planning to surprise us with a much bigger coverage number at year end.

At the UBS conference, Stephens also commented about one of AT&T’s more controversial pricing changes. “There is a real migration to that unlimited texting plan,” he said. That’s hardly a surprise, considering AT&T eliminated all other SMS plan tiers in August. You either pay for an unlimited bucket for $20 a pop, or you pay the outrageous per-message rate of 20 cents per message. If you want to ‘encourage’ customers to buy a particular service, eliminating all other reasonable options is apparently the way to go.