AT&T Says Won't Need Fiber to the Home

Top phone company AT&T Inc. shrugged off concerns on Tuesday that it would need to build a more expensive, all-fiber network to handle an expected surge in high-speed Internet and video traffic.

AT&T is currently upgrading its networks to deliver an Internet-based video service called U-Verse to compete with cable companies.

But unlike No. 2 player Verizon Communications, which is launching a similar service by building a "fiber to the home" network, it is making use of existing copper lines to save costs.

"Our view at this point is that we're not going to have go 'fiber to the home.' We're pleased with the bandwidth that we're seeing over copper," Chief Financial Officer Richard Lindner told a Credit Suisse conference.

"On average, at this point, we're producing about 25 megabits (per second). But in many many locations, we're producing substantially more than that."

Some analysts have said AT&T's method is more efficient, while others have said it would need to upgrade its network again when more consumers start to watch high-definition channels and download movies, requiring increased bandwidth.

AT&T is also preparing to merge with BellSouth Corp., a move that would consolidate its ownership of wireless venture Cingular and reinforce its position as the biggest U.S. telecoms service provider.

Lindner said he hoped the BellSouth merger would be approved at a U.S. Federal Communications Commission meeting on December 20.

"Certainly, from our standpoint, it would be our hope that the merger would get approved and we can close and move on at that point," he said.

"That's certainly our goal ... to have an approval on the 20th. If it does not happen on the 20th, potentially it could slip into January."

Copyright 2006 Reuters Limited.

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