AT&T’s AirGig Announcement: Why Now?

Ed Gubbins - Senior Analyst, Mobile Access Infrastructure

Ed Gubbins – Senior Analyst, Mobile Access Infrastructure

Summary Bullets:

  • AT&T wasn’t very candid in explaining how its latest lab project works, a twist on broadband over powerline.
  • Multiple forces might have given the operator reason to announce AirGig now, before it could say much.

AT&T’s announcement last week of a new technology dubbed AirGig was striking for a few reasons. One was the novelty of the technology itself, which enigmatically promised to transmit wireless signals around power lines rather than through them, putting a new spin on old broadband-over-powerline tech concepts and posing the possibility of self-backhauling mesh networks deployed along the power grid that could deliver 4G and 5G services to the home.

Another thing that was striking about AT&T’s announcement of AirGig was just how little about it the company was at liberty to discuss. For starters, how does the technology work, exactly? AT&T declined to elaborate much. How far could these networks (which use millimeter waves without necessarily being restricted to them and provide both access and backhaul) extend from a wireline backhaul source? It wouldn’t say. How would they be powered if, as AT&T offered, they wouldn’t need to physically connect to the power grid? Inductive (wireless) power transmission is one approach, the company said, but left it at that.

So, why announce a technology that is still being developed if you can’t say much about it?

According to AT&T, the timing of this announcement was sparked in part by the fact that, with more than 100 patents on file for the technology, it would be hard for the company to keep the subject a secret for much longer. I’m somewhat skeptical of the logic behind that argument, which makes the AirGig announcement seem almost involuntary. And in fact, there are other forces which might provide some context for the move to publicize the work AT&T is doing on AirGig:

1. Competitors. AT&T’s two biggest competitors have been making noise lately about their progress toward 5G. Sprint demonstrated tests of what it called pre-standard 5G base stations this summer. And Verizon Wireless has touted plans to trial 5G-related fixed-wireless services in 2017 as a prelude to commercial service launch. Promoting AirGig allows AT&T to counter some of that hype and burnish its reputation for innovation, and because AirGig is aimed chiefly at residential fixed-line use cases, it can directly counter some of chief rival Verizon’s fixed-wireless messaging in particular.

2. Partners. AT&T also mentioned that it hopes to field-trial this technology in 2017 and is looking for both (a) utility companies that are interested in becoming partners and (b) locations that would be ideal. Promoting these intentions could attract interested utility companies to step forward. It could also help attract municipalities interested achieving greater broadband penetration in their communities. (AT&T mentioned that the right regulatory environment would be an important factor in determining the location of trials, signaling to city governments how to improve their odds of being chosen.) And that needs to happen sooner rather than later because working out the business model is as important as perfecting the technology.

Exactly how AT&T will partner with utilities to use this technology is another aspect of this project that is still in development. Not only does the technology rely on partnering with power companies, AT&T has expressed interest in models wherein the operator would use AirGig to provide those utility partners with smart grid-type services. The value of those services could help defray the cost of deployment, and AT&T is very focused on the topic of deployment cost. Speaking of which…

3. Suppliers. In its public explanations of this project, AT&T has repeatedly underscored AirGig’s potential for low-cost deployment. It wouldn’t require expensive fiber rollouts, the company said, and its low-cost plastic antennas would help remedy a thorny problem – specifically, that deploying more base stations alone won’t be enough to meet ever-increasing traffic demand. This emphasis on the anticipated low cost of the technology, which AT&T developed itself, could have its own benefit: urging the company’s suppliers to keep their prices down. That’s especially important for AT&T and other operators since the combination of Alcatel-Lucent and Nokia has left just two dominant RAN suppliers in the U.S. And beyond RAN suppliers, don’t forget the expense of tower-company site fees, which has recently prompted AT&T to evaluate some site leases coming up for renewal. AirGig could be a subtle reminder to tower companies that AT&T could have some other options going forward if site fees prove too high.

Whether or not these forces are influencing the timing of AT&T’s actions in this area, what happens next? Visibility is every bit as limited as the company led us to believe in its vague discussions of AirGig. AirGig services are not on any official roadmap, and it’s not clear how they might intersect with industry standards for 5G services, which, like AirGig, are expected to make use of millimeter wave spectrum and fixed-wireless architectures but in ways that haven’t precisely been determined. If AirGig trials proceed as promised next year, we may hear more about how it sends signals around power lines, rather than just hearing AT&T talk around the topic.

About Ed Gubbins
Ed serves as Senior Analyst for Mobile Access Infrastructure in the Current Analysis Service Provider Infrastructure Group. He focuses on tracking, analyzing and reporting on developments impacting mobile infrastructure and mobile networking: 2G and 3G RAN and packet core along with, LTE, metro-scale Wi-Fi and WiMAX.

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