It’s official: Copper is dead. Long live copper.

AT&T has promised 14 billion dollars to upgrade its infrastructure over the next three years. The initiative, called “Project Velocity IP,” or “Project VIP,” may be the death knell for old-fashioned copper wire, as AT&T has made it clear that they intend to go all-IP, and make no upgrades to their copper wire infrastructure. According to the plan, customers that are in underserved areas will get their service from AT&T’s LTE wireless, which will be expanded to cover 300 million people by the end of 2014. Perhaps not coincidentally, Verizon announced this week also that they expect a complete rollout of their own 4G network by the middle of 2013.

The implications are stunning. We are getting closer to a future with no phone numbers and no per-minute billing, to be replaced by SIP URIs and billing by the byte.  At the same time, the older generation, and people of certain political beliefs, are up in arms that AT&T is abandoning their less profitable customers by simply putting them out to pasture. Verizon, for their part, is the clear LTE leader, with 250 million people already covered, and the Verizon VoLTE network won’t be far behind.

AT&T’s plan calls to expand wired IP broadband network service to 75% of its customer locations by 2015, deploy fiber to an additional one million customers, and offer 99% of its current wireline customers high speed access via fibre and/or LTE. Regardless of your political leanings, AT&T is making the right move for its bottom line and for its longevity.

The biggest losers in this upgrade are the 1% that won’t be reached, the rural areas that have low population density, and the people that simply don’t want to change. Keep in mind, even today many many emergency systems run on copper wire. It will require an investment, whether voluntary or not, on the part of the consumer. It’s like handing someone with a huge record collection an iPod. It’s not a one-step upgrade.

So what will happen to all that unused copper, and who will serve those holdouts? Well, speaking only for myself, I predict that eventually that copper will be picked up by bandwidth companies like XO, Megapath, and Bandwidth.com, to be adapted for Ethernet over Copper, and we may see an age of “dark copper,” an echo of dark fibre. I also believe that if we can find a way to connect Antarctica and the middle of Australia via a combination of VoIP and satellites, we can connect that extra 1% in America. Verizon will also likely pick up some new customers. As cellular providers converge on the same technology, we will also see phone portability, much as we see number portability now. Eventually, you’ll be able to pick your phone (if can still call it that) and your network independently, and be able to try out which network you like best with no long term contracts. The other major networks, Sprint and T-Mobile, will also follow suit, and I hope we can see international and local providers also provide competition. The more VoIP we see, the more competition there is, and the better it is for the market and the consumer.

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