AT&T has brought wireless home Internet to nine more states, offering rural and underserved customers a slightly faster replacement for old DSL lines.
“Our Fixed Wireless Internet service delivers a home Internet connection with download speeds of at least 10Mbps and upload speeds of at least 1Mbps,” AT&T said in an announcement yesterday. “The connection comes from a wireless tower to a fixed antenna on customers’ homes or businesses. This is an efficient way to deliver high-quality, high-speed Internet to customers living in underserved rural areas.”
The service is newly available in parts of Arkansas, California, Illinois, Indiana, Kansas, Michigan, Ohio, Texas, and Wisconsin. The wireless Internet had already become available earlier this year in parts of nine other states, namely Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee. These account for 18 of the 21 states in AT&T’s wireline territory.
AT&T now delivers fixed wireless Internet to 160,000 residential and small business locations, and it plans to boost that number to more than 400,000 by the end of this year and to 1.1 million locations in the 18 states by 2020.
Standalone wireless Internet service costs $60 a month with a 1-year contract, or $70 a month without a contract or after the contract period ends, AT&T told Ars. Customers can get a $10-per-month discount on the home wireless service by bundling it either with DirecTV or AT&T smartphone service.
Installation fees for the outdoor antenna and indoor gateway are up to $99, but the fee is waived if service is purchased with DirecTV. Wireless home Internet service has a monthly data cap of 160GB, an AT&T FAQ says. Customers must pay overage fees of $10 for each additional 50GB, up to a maximum of $200 a month. Data caps on AT&T’s wired services are either 150GB or 1TB.
Government funding, from your phone bill
If you live in the US, you’re probably helping to pay for this rollout because it’s being funded by the federal government’s Connect America Fund, which draws from surcharges on Americans’ phone bills to subsidize rural Internet service. In 2015, AT&T struck a deal with the US government to get nearly $428 million per year for six or seven years, nearly $3 billion, to bring 10Mbps Internet service to parts of rural America.
Although the Federal Communications Commission uses 25Mbps downstream and 3Mbps upstream as the standard for measuring broadband deployment progress, the Connect America Fund requires just 10Mbps/1Mbps.
Connect America Fund recipients were required to meet 40 percent of their buildout requirements by the end of 2017. AT&T’s build to “over 400,000″ out of 1.1 million locations this year will meet the threshold if it’s at least 440,000. AT&T says it is also on track to meet the 100 percent goal by the required date of 2020.
AT&T is also undertaking a multi-year fiber-to-the-home expansion to 12.5 million customers, which is required as a merger condition on its acquisition of DirecTV. The Connect America Fund wireless deployments reach more sparsely populated areas where AT&T isn’t building fiber because the costs per customer are higher.
Many customers stuck with much slower speeds
Even 10Mbps download speeds would be welcome to customers in AT&T territory who get DSL service measured in the kilobits or none at all. But as we noted in this previous story, even after the wireless expansion there may still be millions of customers in AT&T’s copper wire territory with Internet service slower than 10Mbps.
The 1.1 million customers is also a far cry from the amount that AT&T said its fixed wireless service might cover a few years ago. In 2014, AT&T said that in order to get its DirecTV merger approved, it would commit to bringing “fixed wireless local loop broadband to 13 million new customer locations, largely in underserved, rural locations” within four years of the merger closing. About 85 percent of those 13 million wireless locations would have been outside AT&T’s traditional wireline telephone territory; the deadline for that commitment would have been July 2019.
But the Federal Communications Commission did not make that commitment binding in its merger approval. The FCC said that AT&T over-estimated how many underserved rural households there were in the potential deployment area.
AT&T apparently “engaged in some puffery when they were selling the deal” and “the FCC politely called them out on it,” Harold Feld, senior VP of consumer advocacy group Public Knowledge, told Ars. But even at 1.1 million homes, “getting fixed wireless broadband to rural Americans at an affordable price is a good thing,” Feld said.
We asked AT&T today if it will try to hit the 13 million goal anyway. In response, an AT&T spokesperson noted that the wireless proposal was never made binding by the FCC and said the company will meet the fiber commitments required by the FCC. The fiber, combined with AT&T’s existing broadband services, will bring speeds of at least 45Mbps to at least 25.7 million customer locations, AT&T said.
But that means the big wireless deployment outside AT&T’s traditional telephone territory may not come to pass, or at least not by the 2019 deadline that AT&T had proposed. Separately, AT&T has been testing a new wireless system that could deliver multi-gigabit Internet speeds for either smartphone data or home Internet service, but it’s not clear when it will be commercially available or how many people it will cover.