“That's a little bit longer cycle time work. It's something that we need to take well into next year to ramp up to the rate and pace of build that we want.”

In context

“John Stankey : Yeah. Good morning, John. Let me clarify so that you understand what I said in my comment. What I said is that the converged rate in the Lumen footprint rose to 45%. I wasn't suggesting that the broadband sales rate increased 45%. Our ability to pair when we sell a broadband service to pair it with wireless improved to 45%. What we're demonstrating there is in the Lumen footprint, we can run the same kind of plays that we've done in the non-Lumen footprint in getting converged customers brought together and all the goodness that comes with that. We are improving our sales rates in the Lumen footprint, as we've told you. We have expectations that we can take penetrations up in those areas that will start to look like it does in a traditional AT&T footprint, and we're systematically moving through that. As I indicated, we have steps to take to get there. What we're effectively doing right now is converting all the infrastructure, all the branding, all the support systems that we have with customers, all the methodologies the technicians use when they show up in a house, all the CPE that a customer gets that provides that world-class Wi-Fi that we put in place inside of a home that makes that high bandwidth connectivity actually sing. We're converting market by market, and we're pretty much getting to the back end of that now. Once we have the AT&T brand in those markets, then we can go in and really start to put a little more gasoline on the fire and start to drive those volumes up. We're getting to that moment now where you're going to see us begin to lean into it. It's showing up in the numbers. That's part of why you're seeing these really strong results. We have another step up to take here as we move through the year, and that's part of our plan when we talk to you about accelerating performance, that we're going to make that happen. Of course, the other shoe to drop on that is we've got to get the footprint scaling faster, right? You got to get the construction engine up. We're doing that work as well. That's a little bit longer cycle time work. It's something that we need to take well into next year to ramp up to the rate and pace of build that we want. We're seeing progress in that area. It's like anything that has to do with civil work. It's bumpy in places, and you do a little bit better in one geography and a little slower in another. Eventually, we get there. We know how to do that. We've got everything in place to do that. We got all the supply agreements. We're normalizing all the construction agreements and all the things we need. That's pick and shovel work that we still got to get through to make the equation all hang together. Monetizing the agentic traffic, the way I think about it is this. First of all, in the wireless network, you need to build better upstream. Part of why we did the spectrum acquisition we did and why we leaned into the 600 megahertz is we believe the best way to manage a robust upstream in an agentic environment is to have really strong low-band position. We already have an advantage low-band position in the market. The 600 is going to make that advantage even more substantial. Because you can engineer the spectrum a little bit differently, given how those bands are set up, we intend to try to engineer a really robust upstream network that reaches deep into buildings and has a lot of consistency to it, and we think that's what the low band is going to allow us to do. The other thing that's really important, of course, is to get density in the network. Owning fiber footprint allows us to get density. We're now introducing into our network PON-fed small cell infrastructure, taking advantage of all that PON infrastructure we put out there using the backhaul on the wireless infrastructure to get more radiating points deeper into the network. That then allows us to use all the capabilities you've been hearing about for multiple years as to why we did 5G. Why do you do slicing, and why do you have quality of service capabilities that you drive in that are driven towards specific applications? This is what this enables. Do I believe that just like you do in fixed broadband, where we differentiate and we drive better yields on higher performing services, we charge more for a gig than we do for a 500-meg circuit. You are going to see in wireless differentiations in service, in my view. Whether it's an enterprise that needs to buy a slice that is specific to a particular application that they need to support or a customer who has a particular way that they operate and do things in their life that requires it, I think you're going to see service differentiation. My view is it's managing the performance in the upstream that will be the most critical, that will differentiate that. The last thing I'd probably share with you and the way to think about it is, you hear me say it often, I think history repeats itself in this industry. There was a long history or segment of history where VPN was really, really important to customers. Why was VPN important? One was security, and the other was that it managed performance when there were situations of constricted or not plentiful bandwidth. Those are the two fundamental foundations of what made VPN effective. The place in networks where we still see restricted bandwidth is in the wireless business. Fiber basically over-provisions, and you don't have to worry about bandwidth in those circumstances. We know that based on how wireless networks perform now, and probably for the near future, we're still going to have moments where there's restricted bandwidth or restricted performance. I do believe the dynamics of VPN and why those engineered and highly managed networks were important for a period of time in the wireline space will start to become more prevalent in the wireless space, just simply because of bandwidth constraints and the need for higher performance given the kind of applications that are going to be always on and mobile moving forward. I think that's where that monetization premium comes in as kind of a corollary to what you've seen in the past.”