AT&T’s U-verse TVGets Into ‘Bonding’

AT&T is turning to a cheaper way to expand
its U-verse reach to 30 million homes.

This month the telco is starting to deploy digital subscriber
line “pair bonding” in the last-mile copper portion
of its U-verse fiber-to-the-neighborhood network, according
to Randy Tomlin, senior vice president of U-verse field

The technology — which uses two copper wires together
instead of one — will extend U-verse’s reach by between
1,000 and 2,000 feet in a neighborhood. The variety of DSL
that AT&T is using, very high bit-rate DSL, has a useful range
of around 3,000 feet from the video-ready access devices
(VRADs) that are the fiber-fed nodes in the U-verse network.

Using DSL pair-bonding combined with new U-verse
buildouts, Tomlin said, AT&T expects to pass 30 million
homes by the end of 2011, up from 23.8 million at the
end of March 2010. Pair bonding is much less expensive
than planting new fiber, he noted, though he declined
to specify costs.

“It uses the network we have in place,” he said. “We
don’t have to dig up streets, alleys or yards.”

The telco plans to use pair-bonding across its entire
footprint, encompassing 22 states and 122 markets. Its
existing DSL vendors, Alcatel-Lucent and 2Wire, are providing
the low-power equipment for pair bonding.

AT&T had previously expected to use pair-bonding starting
in 2008. Tomlin said the telco worked with its suppliers
to get the electronics to use less power and be reliable
enough to deliver voice, video and data to its satisfaction.

Pair bonding won’t increase the bandwidth AT&T can
deliver over the network, Tomlin said. The current maximum
downstream speeds for pair-bonded DSL will be 18
Mbps, while the telco offers the 24-Mbps Max Turbo tier
to certain customers located closer to VRADs.

In the last two years, AT&T has reined in U-verse’s expansion
plans. The company had previously targeted
passing 30 million homes by 2010, according to its December
2007 forecast. At 30 million homes, U-verse TV
would have coverage of about 50% of the residential living
units and 33% of businesses in its footprint.

In the first quarter AT&T cut spending on U-verse. Wireline
capital expenditures for the first three months were approximately
$2.1 billion, down 14% from the year-earlier period,
according to the telco’s quarterly report. AT&T said it had decreased
spending on U-verse services “as the upgrades to our
existing network become more mature.” Still, for the full year,
AT&T expects total capex in the range of $18 billion to $19 billion,
up approximately 5% to 10% from last year.

AT&T is scheduled to report second-quarter earnings
on July 22, when it will provide an update on U-verse subscriber
and network deployment figures.