AT&T Should Boost Fiber, Says Market Researcher

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AT&T will have to take its fiber all the way to the home if it wants to be competitive with cable's improvements in capacity, according to a report from BNA market research company Pike & Fischer.

AT&T is rolling out its U-Verse service for broadband access and multichannel TV, similar to Verizon's FiOS service, which has a head start.

AT&T has been building fiber to the node, then using copper lines for the last mile. When it expands beyond its current limited roll-out of some part of 11 metro areas, says Pike & Fische, it will be "forced to increase its network investment to carry the fiber lines right up to homes—a costlier approach known as fiber-to-the-premises—as it expands its deployment on a large scale."

"AT&T is attempting to position its TV service as superior to cable, but there's nothing to prevent those competitors from matching the U-verse features over time," says report author Tim McElgunn, chief analyst for Pike & Fischer's Broadband Advisory Services.