AT&T focuses on expansion – the fiber optic offensive continues

The US consumer services sector is bracing for a storm of fiber-optic mergers and acquisitions. Amid this dynamic environment, AT&T has made it unequivocally clear that it does not intend to stand still while competitors like Verizon and T-Mobile are heavily investing in expanding their fiber-optic networks to catch up technologically. As if recent statements from senior AT&T executives hadn't already dispelled any doubts, the company is now sending another signal through a newly expanded purchase agreement worth over $1 billion with the US fiber-optic provider Corning. In conjunction with strategies in September 2024 to expand the open-access fiber model, a picture is emerging: AT&T is willing to leverage every available resource to maintain its lead in the fiber-optic market. The expanded agreement with Corning comes just one month after Lumen's announcement to secure 10% of Corning’s global fiber-optic capacity for two years, marking Lumen's largest fiber-optic cable purchase ever. This underscores how intensely active the US fiber-optic market currently is. AT&T claims to be Corning’s largest customer, and the expanded, multi-year infrastructure deal will provide AT&T access to state-of-the-art fiber-optic equipment to maintain build-out speed and customer acquisition rates while simultaneously expanding deployment targets. Furthermore, this supply pipeline will meet the requirements of the US National Telecommunications and Information Agency’s “Build America, Buy America” program, which is crucial for potential projects funded through the BEAD program to secure indispensable resources in the forthcoming fiber-optic offensive. Importantly, AT&T's fiber-optic initiatives are not limited to internally expanding capital-intensive capacities. The company’s executives have recognized that open-access agreements can significantly increase an ISP's population coverage, with early market penetration of open-access models aligning with the expected performance of internal developments. The recent Corning agreement follows AT&T's September announcement that collaboration with open-access fiber will continue to be promoted: just days after Verizon announced its proposal for a $20 billion acquisition of Frontier Communications, AT&T not only reaffirmed its intention to expand the Gigapower fiber-optic joint venture with BlackRock beyond the targeted goal of 1.5 million covered households but also introduced four new open-access partners: Boldyn Networks, Digital Infrastructure Group, Prime Fiber, and Ubiquity.