Transitioning to an IP economy Modernizing regulation to spur investment and keep up with consumer demand 1
The way the world communicates has changed dramatically since 1934 2
People are connecting in more ways than ever before Historically the telephone connected you to a place Today, services that run on IP networks connect you to anyone, anywhere 3
Consumers are adopting new technologies faster than ever 4 Source: Testimony of Peter Farago, Vice President, Marketing, Flurry, Inc. before the Committee on Energy and Commerce, Subcommittee on Commerce, Manufacturing and Trade, September 12, 2012.
Consumers are quickly replacing traditional landlines 5 Source: 1. CDC, Wireless Substitution: Early Release of Estimates From the National Health Interview Surveys, January-June 2007 (12/10/07) and January-June 2013 (12/18/13).
450,000 Every month, more than Americans switch to phone services that run on wireless and Internet-based networks 6 Source: FCC Local Competition Reports ILEC Residential switched access lines 2009-2012. 2014 AT&T Intellectual Property. All rights Reserved.
Nationwide Increase in Housing Units and Decrease in ILEC Residential Lines 7 Source: FCC Local Telephone Competition Reports, Census Bureau data and ratio of AT&T primary residential access line to total residential access lines; estimation for 2013 and 2014 based on extrapolation of data by AT&T.
Low-income households, seniors, and rural residents are also choosing new technologies 8
Low-income Americans are switching to wireless 9 Source: Wireless Substitution: Early Release of Estimates From the National Health Interview Survey, Centers for Disease Control and Prevention, January June 2013.
Lifeline subscribers are switching to wireless 10
Older Americans are increasingly adopting new technologies 11 Source: Smith, Aaron, Older Adults and Technology Use. Pew Internet & American Life Project, April 3, 2014, http://www.pewinternet.org/2014/04/03/usage-and-adoption/, accessed on April 4, 2014.
Use of predominant broadband technologies in rural areas wireless and satellite more than doubled since 2007. 2007 Today 12 Source: TIA s 2012 ICT Market Review and Forecast, Telecommunications Industry Association, March 2012.
New technologies have changed how Americans do business 13
To meet growing consumer demand, AT&T has invested nearly $119 billion since 2008 We ve invested more in America over the past six years than any other public company 14
Now we plan to invest billions more to expand and enhance the AT&T network Bringing advanced IP technology to 99% of customer locations in AT&T s wireline service area AT&T IP High Speed Internet AT&T 4G LTE High Speed Wireless AT&T U-verse Digital TV, High Speed Internet & Voice And deploying fiber to a million more businesses AT&T Business Internet Services 15
But even more investment is needed to keep up with consumer demand 16 Source: Ericsson, Traffic and Market Data Report, June 2013.
Outdated regulation requires continued investment in services consumers are leaving behind 17
Despite growing competition, only traditional wireline providers are constrained by antiquated regulation Traditional Wireline Providers CenturyLink AT&T Verizon Frontier Comcast Time Warner Cable Cricket HughesNet Charter Communications US Sonet Paetec T-Mobile Boingo Illinois Valley Cellular ClearWave Sprint Fring Other Competitors (and many more) Lingo Virgin Mobile U.S. Cellular Mediacom WildBlue RCN Clear Tracfone WOW! Vonage Apple Google Microsoft Facebook 18
Requiring continued investment in old network technology will slow the effort to connect all of America with high speed Internet Regulations require certain carriers to maintain POTS a requirement that is not sustainable and lead to investments in assets that could be stranded. The National Broadband Plan These regulations can have a number of unintended consequences, including siphoning investments away from new networks and services. The National Broadband Plan 19 Source: The National Broadband Plan, Chapter 4: Broadband Competition and Innovation Policy, Section 4.5, Transition From A Circuit-Switched Network.
Regulations must be modernized so carriers can direct more investment toward the new IP services consumers demand 20
Building an IP economy is key to America s future Projected private investment in wireless infrastructure over the next five years will generate as much as $1.2 trillion in economic growth and create an estimated 1.2 million new jobs. 21 Sources: http://www.pcia.com/pcia-press-releases/601-wireless-infrastructure-investment-will-generate-1-2-trillion-in-economic-activity-and-create-1-2-millionjobs.
To ensure a smooth transition to all IP-based services, AT&T has started test trials to address potential issues or concerns in Florida and Alabama. 22
In February 2014, AT&T filed a petition with the FCC proposing to select two communities nationwide Carbon Hill, Alabama and West Delray Beach, Florida for a trial technology program. Overseen by the FCC, the trial program would connect customers and communities using newer networks and technologies. Carbon Hill, AL West Delray Beach, FL 23
Throughout the trials, AT&T will work with policymakers, consumers and others to answer questions, address concerns and put solutions in place, while ensuring that the important values of universal service, competition, public safety, reliability, and consumer protection continue to be met. 24
Regulation needs to be modernized now to help America achieve an IP economy by: Driving innovation & investment in new technologies Creating more job growth Meeting consumer demand today & tomorrow Helping America achieve the National Broadband Plan Helping keep America competitive 25
Future? What will Net Neutrality rules mean to investment. NG 911 plans 26 2013 AT&T Intellectual Property. All rights reserved. AT&T and the AT&T logo are trademarks of AT&T Intellectual Property.