In an update to its convergence strategy at its Dec. 3 Analyst & Investor Day, AT&T set an aggressive new goal to pass at least 50 million fiber locations by the end of 2029 while sunsetting much of its legacy copper network.
Impact: The new fiber passings goal builds on AT&T’s previous deployment strategy to reach 30 million total fiber passings by year-end 2025 and has everything to do with the company’s overarching mobile-broadband convergence goals. According to COO Jeff McElfresh, AT&T will end this year with 29 million fiber locations passed. To reach the 50 million mark, AT&T will add 3 million or more fiber passings per year for the next five years. That will give AT&T 45 million passings across its footprint by year-end 2029 thanks to “organic deployments.” The remaining 5 million or more passings will come from leveraging AT&T’s Gigapower open-access joint venture with BlackRock as well as its recent open access agreements with Boldyn Networks, Digital Infrastructure Group, Prime Fiber, and Ubiquity. Coupled with a goal to cover more than 300 million people with mid-band 5G by year-end 2026, the increased fiber expansion reflects AT&T’s determination to grow its wireline footprint to make its convergence strategy successful.
A research note from New Street Research analyst Jonathan Chaplin, who thinks AT&T could reach 50 million passings on its own and then add the 5M open-access locations onto that number, said the speed of AT&T’s proposed deployments rather than the number of passings could present the biggest challenge to cable operators currently dominating the convergence category. AT&T could also look to extend its fiber footprint through strategic acquisition, though Chaplin cautioned that the $10 billion it plans to set aside for “incremental financial flexibility” could limit its ability to make any large acquisitions. That could take a potential deal for a large provider like Lumen off the table but doesn’t mean AT&T couldn’t pursue future acquisitions for smaller operators like Allo, altafiber, Brightspeed, Consolidated Communications, Google Fiber, Shentel, TDS, Windstream, or even Ziply Fiber.
AT&T will continue to proceed with the decommissioning of its legacy copper network on a timeline parallel to the fiber expansion, with the company planning to mostly be out of the legacy copper business by the end of 2029. Of AT&T’s 88 million total wireline locations, 21 million of which are voice only and 67 million of which are broadband-capable, only 5% of the company’s residential subscribers still use legacy copper voice technology. The only fly in the ointment for AT&T’s strategy a the moment appears to be California, where regulatory approval for the copper decommissioning has so far been blocked. But that doesn’t mean the regulatory process to exit copper elsewhere won’t come under review.
Because AT&T doesn’t plan to deploy fiber to half of its wireline footprint, the company will need to move customers still using legacy copper onto services powered by broadband, fixed wireless access, and even satellite connectivity. FWA-
based Internet Air, for instance, offers speeds up to 25x faster than DSL for customers not passed by fiber. To help cushion the transition for copper voice customers, AT&T recently launched AT&T Phone-Advanced, described as a like-for-like service that allows customers to use existing landline devices and run them either on a wireline broadband connection or AT&T 5G network. The copper network retirement will proceed in two phases, with the first targeting the locations AT&T doesn’t plan to pass with fiber, with the 10% of its customer base in those areas fully transitioned to Internet FWA or satellite by 2027, while the second phase will target areas where AT&T will build out fiber and wrap up by 2029.
