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Verizon, AT&T Finding No Health Threat From Lead-Laden Wires

AT&T Chief Financial Officer Pascal Desroches and Verizon CFO Tony Skiadas said at a Bank of America financial conference the companies continue to test soil under the lead-laden wires in their networks and so far have found no evidence of a public health threat (see 2307210004).

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Desroches said Thursday he had to be “pretty measured” in what he said because litigation is likely. When The Wall Street Journal “made allegations of a public health crisis, clearly that got our attention because we are really proud of our long history of employee safety protocols,” he said. “We tested some of the sites that the journal alleged were problematic and didn't find that there were any issues.”

The state of New York, the EPA, Verizon and AT&T have all done tests and didn’t find problems, Desroches said: “Could we all be wrong? I don't think so.” AT&T is providing the EPA “with all our testing results and … this is something that we take really seriously,” he said.

Skiadas echoed AT&T’s comments that tests by outside experts so far have shown no problems. “We're doing a very fact-based and science-based approach, prioritizing the health and safety of our employees and the communities that we serve,” Skiadas said: “We're working very proactively with the EPA on it and with the other regulators … As we have more to share, we'll certainly do so.”

Verizon on Wednesday released an update on test results from three sites the WSJ mentioned: Wappingers Falls, New York; Coal Center, Pennsylvania; and West Orange, New Jersey. In each case, the tests showed that soil lead levels near Verizon’s cables were below threshold levels set by each state.

Both CFOs declined comment on T-Mobile’s recently announced 600 MHz spectrum deal with Comcast (see 2309120076).

Clearly, T-Mobile felt like they needed more depth there,” Skiadas said. “We feel really good about our spectrum position,” Desroches said: “One of the things I don't think that gets said nearly enough is the quality of our network gets better each and every day and has improved significantly.”

Desroches agreed with comments Wednesday by T-Mobile CFO Peter Osvaldik that the wireless industry is competitive, but stable (see 2309130068).

Apple raised prices with the new iPhone and every carrier is going to approach launch of the new handset “slightly differently,” Desroches said: “All in all, I would characterize the environment as really healthy. The competitive dynamic is very, very healthy, very rational.” Desroches acknowledged that the level of subscriber growth over the past two years wasn’t sustainable. “Overall, the industry is growing, and we are getting our fair share,” he said.

AT&T remains interested in fixed wireless access, though it hasn’t pursued that business line at the same level as its peers, Desroches said. AT&T believed “the cost of providing bandwidth is going to be much higher through that product than a traditional fixed line given all the demand trends that we were seeing” and that has proven to be correct, he said. There are places where FWA “makes a lot of sense,” but the carrier’s priority is still fiber, he said.

Everyone is excited about the new iPhone, said Sowmyanarayan Sampath, CEO-Verizon Consumer Group, who also spoke. “This is a big time of the year for us,” he said: “Upgrade rates have been slow. You saw that last quarter. They continue to be soft. The next couple of weeks makes the quarter for us.”

Skiadas is pleased with where Verizon is at this point: “Fios is growing. Fixed wireless access is growing. We have over 2.3 million FWA subs in our base right now and [are] well on our way to the 4-5 million target.”

Sampath said he’s “more comfortable” about the $52 billion Verizon spent on C-band licenses in the 2021 auction than he was when deployment started. Sampath tracks on a weekly basis churn in C-band and non-C-band markets, as well as the number of subscribers opting for a premium product. “We tend to do much better … in C-band markets,” he said: “More revenue, less churn, make for a very happy business case.”