Is AT&T’s Wireless Network a Victim of Mismanagement?

by Matt Klassen on May 2, 2011

How much wireless spectrum does one company need? It’s a question that’s on the minds of everyone at the Federal Communication Commission (FCC) this week as the regulatory committee continues to analyze the proposed merger between AT&T and T-Mobile. We already know that AT&T, in defence of the proposed agreement, is arguing that it needs T-Mobile’s spectrum to remain competitive in the wireless market, as with the traffic generated by devices such as Apple’s iPhone and iPad put debilitating strain on the company’s current network.

But is the company telling the truth? It’s been abundantly clear to me over the past several years that AT&T’s network has simply been unable to handle the data load created by its line up of devices, in fact the company has admitted as much. But over the years AT&T has been quick to point the finger at the devices themselves for the company’s shoddy network, without realizing, of course, that four fingers were pointing back at AT&T.

Consider the fact that AT&T, T-Mobile deal aside, already has more spectrum than any other American provider, and a picture begins to form not of a company with data hungry devices, but a company that lacks the ability to effectively manage its available resources.

The world of wireless spectrum is a lot like the world of real estate, there are the much sought after beachfront properties and then there’s the other one’s over by the railway tracks, and in the American spectrum scene, all the good land is already bought up. The reality is that there is only so much available bandwidth available for companies to use to create their wireless networks, and it should come as no surprise that every useful piece of it has already been spoken for.

That means that until the FCC releases more usable bandwidth to the market, if you want to make create or improve your wireless network, well you have to buy the needed bandwidth from someone else, and soon that someone else will almost certainly be AT&T.

Back to AT&T, the company is claiming that it cannot fulfill its short or long term network commitments without acquiring more spectrum, something that the company is looking to achieve through acquiring T-Mobile. But in addition to the reality that the AT&T already owns more spectrum that any of the other top 21 carriers in the US market, in turns out that AT&T is not even using about a third of what it already has.

It is revelations like this that have driven many to vehemently oppose the AT&T/T-Mobile deal, as AT&T’s network seems to be a victim of mismanagement and not of intense data traffic. As Sprint’s VP of Government Affairs Larry Krevor recently noted, “It’s hard to reach the conclusion that the wireless carrier with the most spectrum and best spectrum isn’t able to serve its customers with what it already has…every carrier has to use its spectrum resources as efficiently as it can.”

It is this question of efficiency that will hopefully dominate the FCC’s future proceedings on this matter, as its looking more and more like AT&T is trying to mask the fact that it has a problem, a serious problem…its addicted to spectrum and it doesn’t know how to handle it.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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Jim S May 3, 2011 at 11:19 pm

I have a simple question. You make the claim that AT&T is only using 1/3 of it’s available spectrum. What is that based on? Even if it is true, why in heavens name would AT&T not just about kill itself to deliver the best network experience possible? Especially in blog heavy cities like San Francisco and New York. Over the last 36 months, AT&T has invested nearly $50 billion in network improvement. This is according to their annual reports and published press releases. If the user experience is not where it needs to be, there must be another explanation than “poor management”. This is lazy blogging.

Matt Klassen May 4, 2011 at 12:52 pm

Jim,

Thanks for the comment. I will admit that I didn’t do the research myself into AT&T’s network usage, but I have sources for my claims regarding the management of AT&T’s available spectrum.

The facts remain, AT&T has more available spectrum than any other wireless company and I’ve read fairly damning reports over the past year that have demonstrated that AT&T doesn’t even have the most data traffic on its network. In my mind, Most Spectrum + Manageable Data Traffic should not equal the situation AT&T finds itself in today.

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