Summary
1. AT&T has had a subpar year so far. 2. It is not just the economy that has wreaked havoc on its business plans and on its growth. 3. Both the wireless and wireline businesses have been hampered by cutbacks in spending and by the ongoing threat of a strike.
Analysis
AT&T is finding out the hard way that consumers, both residential and business, want fiber optic solutions for their landline networks. But more importantly, the RBOC is being attacked for its wireless infrastructure problems. As AT&T pushes forward with its 3G network expansion and upgrades, which is woefully far behind Verizon’s network, its reputation is taking a severe hit. To top off what was supposedly a saving grace, the Apple iPhone 3G S is already being joked about regarding its sluggish speed. In addition, AT&T has been under fire concerning its pricing plans for the new iPhone.
Verizon Wireless president, Lowell McAdam, took aim at AT&T’s network by calling it slow and saying the promised upgrades to greater speed are nothing more than PR spin.
AT&T is promising a faster network, but it has been doing so for over a year without any significant relief.
Unfortunately for AT&T, if it does not soon listen to the outcry regarding the inability of its 3G network to deliver on heavy data usage, it may find itself in real trouble attracting and maintaining customers. Verizon is salivating.
