Research Firm Blames AT&T’s Poor Network On Disproportionate Wired Network Spending

News | Thursday January 21 2010 4:28 AM | Comments (0) Tags: , , , , , , ,

At a conference call hosted by his firm, Hallaren alleged that AT&T's capital expenditure on wireless networks from 2006 to Q3 2009 totalled $21.6 billion. In comparison, Verizon spent $25.4 billion on its wireless network while Sprint spent $16 billion in this time period. Hallaren argued that the per subscriber spending by AT&T was just $308 compared to $310 spent by Sprint and $353 spent by Verizon.
income vs. expenditure
” on AT&T's wired and wireless networks. Hallaren pointed out that AT&T earns 57% of it operating income from wireless network though it only spent 34% on its capital expenditure. In contrast, 65% of the company's capital expenditure was on wired network though the segment only contributed to 35% of the operating income.
Hallaren's claims, which are based on AT&T's regulatory filings make logical sense. However, AT&T has disputed the validity of the findings claiming Hallaren's statements do not reveal the complete picture.
According to a statement from AT&T spokesperson McCall Butler, Hallaren's study has failed to take into account spectrum purchases and acquisitions that AT&T made during this period in order to build its mobile infrastructure. Butler claims that the company spent $19 billion on wireless infrastructure in just the fifteen months in 2008 and Q1 2009.
Elaborating further on AT&T's investments, Butler says a chunk of investments also go into backhaul – the wired networks that carry the traffic from the
; something that is not depicted specifically as a wireless investment in the filings.
The two sides have posted compelling arguments, which make us sit back and ponder upon the ground realities. It is to be noted that while a lot of our readers have indeed complained about their AT&T network, a good number of them have also written in to say that they are happy customers. Even third party studies have been inconclusive. While Consumer Reports
of AT&T, another
pointed to a network that was better than its competitors.
Which side of the argument between Hallaren and AT&T will you take? Post your views in the comments.

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