As we wrote in a column last week, AT&T is championing its mobile stability in the region. And Dan Lafond, AT&T’s vice president and general manager in central and eastern Pennsylvania, wants you to know about it.
The wireless carrier has received its fair share of criticism since the iPhone launched in 2007. Though the smartphone galvanized the mobile industry, AT&T—which, for now, exclusively sells Apple’s iPhone—has been beaten into the ground for network capacity concerns. A report released in October said that more than half of iPhone users would jump to another network if given a chance.
But the carrier has also responded with substantial infrastructure investment. In Pennsylvania alone, $725 million has been spent on capacity. And it seems to be paying off.
But, as Lafond notes in the interview below, in San Francisco and New York where the network is most congested, there exists the most news outlets reporting on technology, hence more negative coverage. Here in Philadelphia, he says, AT&T has reason to brag.
After the jump, we discuss with Lafond AT&T’s infrastructure investments in Pennsylvania, how mobile is affecting the digital divide and of course, the impact of the iPhone and what will happen if Verizon cuts a deal with Apple, too.
Though AT&T Wireless announced plans to upgrade its network infrastructure at Citizens Bank Park, some are still seeing problems at the venue. Where are you guys at in the rollout of the site’s upgrades?
We’re still serving the ballpark with macro cell-sites. The ultimate goal is to get the system inside the stadium, with the antennas built around the seating area. The process is taking longer than I would like. It’s not the Phillies, it’s not AT&T, it’s pulling these organizations together. Mid-May to June timeframe is where we’ll be up operationally.
The iPad is all the rage. How are you guys preparing for the 3G launch?
The good news is, we saw data growth 18 months ago, so we’ve been prepping all along, adding cell sites, adding 3G, adding the backhaul. We’re positioned well for the iPad. Right now from a data perspective on the network in my market, venues are a real pressure piece, but I don’t see people bringing the iPad to a Phillies game.
AT&T worked with SEPTA to offer cellular coverage on the Broad Street Line and Market-Frankford line. We’re wondering if there are any other public-private partnerships in the works.
With SEPTA, we got better at building underground and we’ve reaped some good benefits. Being the only guy down there has helped us win in the corporate and consumer space.
But we’re seeing a huge climb in the hospital arena. Five years ago, there was no cell phones in the hospital. Now they’re aggressively pursuing this space. Similar to Citizens Bank Park, we’re in most of the major hospitals. Another space is the casinos.
In Pennsylvania, AT&T has added 60 cell sites, upgraded 400 sites to 3G and turned on HSPA 7.2 technology. Do you have an idea of how many of those are in the Philadelphia region? What metric do you use to judge how well the upgrades are performing?
The single best metric to look at the health of our business is post-paid customer churn; the satisfaction of customers. Churn is always going to guide me back to principles of how healthy my market is. In the region we do 20 to 25 percent better than the company’s [national rate of 1.19 percent]. You know the competitiveness in Philadelphia. Everyone that wants to play in wireless is here. For us to be that much better in Philadelphia is pretty sweet. We’re continuing to drive record churn with our customer base.
Wireless data has grown 5,000 percent in the last three years, AT&T has said. There’s a lot of discussion around digital divide issues that many young folks are utilizing smartphones and wireless data in urban neighborhoods. Do you have any insight on urban use of wireless data?
Anecdotally, looking at the mix of what we sell in our [urban] stores, devices are highly concentrated in our smartphone category and quick-messaging category. And you’re seeing with the Metros and Crickets, that they’re starting to get in the category of some of these smartphones. That’s telling me there is demand out the in the inner-city.
A March interview with AT&T CEO Ralph de la Vega had him saying that HSPA+ would be rolled out in certain locations around the country—When might HPSA+ come to the region? How about LTE?
If my network director was on this call, he’d say we’re going to max out every cell site. Ethernet is the ultimate goal and that sets us up for LTE. We’ve got a good plan in the back-half of the year to deploy in hotspots like beaches and downtown. We’re first in line seeing this [data] growth, so we have to be first in line making sure each site is maxed out.
We’re probably more positioned in 2011 for the local market. There’s still a lag out there for devices in the LTE environment. We have to get the back haul ready. You’ll start to see us start to make some noise
AT&T has been criticized by consumers for dropped calls and slow data usage and reports have backed up those concerns. We’re wondering what kind of large lessons you guys have learned that are steering the network’s direction.
When outside surveys have hit us, we take them to heart. But it usually boils down to two markets—San Francisco and New York. That’s the immediate impact you’re seeing from all the negativity that hit us. I want to brag a little bit about how well this market is doing. New York City is performing much better, the investments came quickly, which helps me down the road. We learn from them. That’s the benefit of being right next to them.
The Wall Street Journal suggested last month that network upgrades like this are an attempt to slow a potential “mass exodus” to Verizon should they launch a CDMA iPhone. What is the general feeling at the executive level about a Verizon launch?
The iPhone has been successful for us. Timing is one thing we don’t know about. I can tell you, we’re still positioned very well in a couple categories. We’re introducing new smartphones all the time. Apple is a big part of that. And it comes back to churn. The term “mass exodus,” I don’t see it from our seat from how we’re performing locally.
I’m wondering if there’s any truth to the what the Wall Street Journal called the 100-day plan, to improve network capability in major cities last fall. What is being done in Philadelphia to improve network capacity and quell user concern?
We hit a couple bumps in the October time frame. But with new software releases and added capacity, we came out of it and in 2010 we continue to drive excellence.
The network is critical. That’s what’s on everybody’s mind. We don’t often get a chance to brag. The business is really sound right now. Not only are we saving the customer base, we’re winning at the high-end revenue space with all these smartphones. We’re well-positioned. We were first in line of the data explosion and we continue to be ahead of it.