Pascal Desroches, Senior Executive VP and CFO, AT&T Inc. Source: AT&T

AT&T is leaving the 5G-based fixed-wireless access (FWA) door open as rivals have shown the ability to leverage operational growth out of that market. But for now it remains a fiber-first broadband believer.

The carrier’s CFO Pascal Desroches said the most likely instance for AT&T to use FWA would be in rural areas where deploying fiber could prove too costly.

“We think in certain instances it makes sense,” Desroches said during an interview at this week’s Bank of America Media, Communications, and Entertainment Conference, according to a transcript. “If you're in a rural area where it does make – where the economics don't pan out for fiber, fixed wireless will be an interesting solution.”

Desroches specifically noted locations where “we’re not going to get fiber for another two or three years,” where FWA “may make sense as a good catch product.” However, he quickly added that means “we keep the customer and then ultimately transition them to fiber.”

Despite the meager support, AT&T does offer a 5G-based FWA product and previously stated that it served more than 130,000 FWA customers. Desroches admitted that product was in need of updating, and “you’ll hear from us soon on that.”

However, AT&T’s transition end game is predicated on the carrier’s belief that fiber is a better long-term solution for customers and its operations. Desroches explained that FWA extracts a “very expensive” toll on the carrier’s mobile operations.

“Long term, we don't believe it will be good enough," Desroches said of FWA. “And that's why we think it is really important to start to place our bets now with fiber because by the time fiber becomes the only acceptable solution, it will be too late to start to build out because of the long lead times.”

Desroches previously stated that “if you decide you want to do fiber four or five years from now, it's too late. And this is why we think we are building a strategy for long-term sustainable earnings with the best possible technology.”

To support that need, AT&T recently signed a long-term deal with fiber builder Corning, which is using that deal as the basis to build a new cable manufacturing facility in Gilbert, Arizona. AT&T also formed a “Fiber Optic Training Program” with Corning targeted at training 50,000 people to design, install, and maintain fiber networks.

“This investment is a significant step forward for our country and building world-class broadband networks that will help narrow the nation’s digital divide,” AT&T CEO John Stankey noted in a statement tied to the Corning deal. “This new facility will provide additional optical cable capacity to meet the record demand the industry is seeing for fast, reliable connectivity.”

CCS Insights recently forecast a 160% growth rate for FWA for 2022, hitting 7 million connections by the end of the year, and a staggering 83 million connections by the end of 2026. The research firm singled out North America as the current hot spot for the market.

And Ericsson’s most recent 5G Mobility report predicts FWA connections are going to grow 17% annually through 2027.

AT&T rivals Verizon and T-Mobile US have both shown short-term FWA customer growth backed by robust marketing of 5G-based services.

Verizon reported it added 186,000 FWA connections during the second quarter and has been running an aggressive promotional offer to gain customers and is pushing to add the additional capacity and speed from its C-Band deployments.

Manon Brouillette, EVP and CEO of Verizon’s Consumer Group, speaking at the same Bank of America conference, explained the FWA service is leading to broader company growth.

“The good thing is that 30% of our new subscriber to FWA had no service with us, so we can upsell them to postpaid,” she said.

T-Mobile US added 560,000 FWA broadband customers during its most recent quarter, however reports indicate the carrier might be growing that business too fast, potentially adding validity to Desroches mobile network impact comments.

“Obviously, T-mobile is leading this charge and is having tremendous success attracting new subscribers to its 5G FWA service, which is coming at the expense of the major cable operators in the U.S.,” Dell'Oro Group analyst Jeff Heynen recently told SDxCentral. “I think this churn from cable to FWA is going to be one of the major storylines of the year. Our projections for FWA CPE purchases and what we have already seen purchased so far this year corroborates the effort wireless providers are putting into growing their FWA subscriber base.”