Can AT&T’s GigaPower service drive the company’s U-Verse business?

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Nov. 20 2020, Updated 3:26 p.m. ET

AT&T offers its ultra-fast U-Verse GigaPower Internet service

In the prior parts of this series, we’ve discussed how AT&T (T) lost net broadband Internet subscribers in the last quarter and how cable companies like Comcast (CMCSA) and Charter (CHTR) managed to attract the most broadband subscribers last year. The main reason why telecom companies aren’t able to grow their subscriber base as fast as cable companies is the difference in Internet speeds they offer.

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But, earlier this year, AT&T announced its intention to bring its super-fast U-Verse GigaPower Internet service to 100 cities in the U.S., including 21 major metropolitan areas. This service would provide Internet speeds up to 1 Gbps (gigabit per second). Recently, AT&T announced that its GigaPower service has exceeded expectations in Austin and will soon start deploying in Dallas and North Carolina.

AT&T doesn’t figure in the list of the top five players in terms of Internet speeds

The GigaPower service could provide AT&T a much-needed edge to compete with rivals. According to a report by Netflix (NFLX) and as the chart above shows, Cablevision-Optimum (CVC) is the highest-ranked U.S. Internet service provider in terms of average speed in Mbps as of August 2014. Cox, Suddenlink, Comcast, and Charter take up the next four positions in the rankings for the highest Internet speeds in the U.S. But AT&T U-Verse doesn’t figure in the list of the top five players. It ranks at seventh position, with Verizon’s (VZ) FiOS service ranking at an even lower tenth position.

This explains why cable companies are gaining more subscribers compared to telecom companies. But AT&T’s GigaPower service and Verizon’s FiOS Quantum service hold promise to provide better broadband services to customers. You might be interested in reading our piece on Verizon’s FiOS Quantum service in Market Realist’s article Will FiOS Quantum improve Verizon’s broadband service?

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