AT&T’s chief financial officer John Stephens has revealed that the company plans to increase its fiber footprint by 3 million customer locations in 2021.
AT&T believes it has the right approach to the market, providing customers with the best possible wireless offers to reduce churn and maintain a high-quality base.
The company has continued to invest strategically in its network, including during the recent C-Band Auction (Auction 107).
AT&T is attracting and keeping customers on its higher value plans. AT&T also has the fastest wireless network in the nation, which also helps attract and retain customers, John Stephens, senior executive vice president and chief financial officer of AT&T, said at the Deutsche Bank Media, Internet & Telecom Conference.
AT&T expects wireless service revenue growth in the 2 percent range in 2021 as the company continues to add customers and connected devices on its network, subscribers continue to migrate to higher ARPU unlimited plans, and churn improves. He also expects modest wireless EBITDA growth in 2021.
Stephens said fiber is the foundation for AT&T’s network, including broadband connectivity and 5G. He reiterated that the company continues to grow its network, building out the fiber connection directly to consumers and businesses.
AT&T currently markets its 100 percent fiber network to more than 14 million customer locations, which it is actively selling into, with penetration rates increasing the longer the company has fiber in a market.
Through its integrated fiber strategy, the company plans to increase its fiber footprint by 3 million customer locations in 2021. Stephens noted that at the end of 2020, about 80 percent of its IP broadband customers were using either fiber or VDSL technologies, AT&T CFO said.
AT&T’s agreement with TPG to form a new entity named DIRECTV to operate its U.S. video business unit will better position AT&T to maximize the benefits of the long-term strategic trends influencing its business. Maintaining a stake in the U.S. video business will allow the company to participate in future value creation opportunities, Stephens said.
The company’s U.S. video business will be classified as “held for sale” beginning with first quarter 2021 results. The company will be updating the lives of video customers used to determine associated subscriber acquisition costs.
AT&T has seen positive results from the hybrid distribution model for its 2021 film slate. This model has positioned Warner Bros. as the only major studio steadily releasing content to theaters as well as directly to consumers through HBO Max. The company expects a modest theatrical recovery in the second half of the year.
HBO Max and HBO added more subscribers in 2020 than HBO added in the previous 10 years. AT&T expects to begin international expansion of HBO Max in late June, giving the company additional opportunities to expand its customer base.
Stephens said AT&T remains committed to its capital allocation plan to: grow customer relationships across 5G wireless, fiber and HBO Max; sustain the dividend at current levels; reduce debt; and monetize non-core assets.
The company plans to provide more information during its Analyst & Investor Day, which will be held at 10 a.m. Eastern time on Friday, March 12.
