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AT&T (T) Boosts Connectivity With AST SpaceMobile Partnership

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AT&T Inc. (T - Free Report) and AST SpaceMobile have entered into a definitive commercial agreement, extending until 2030, to provide a space-based broadband network directly to everyday cell phones. Previously operating under a Memorandum of Understanding, this new agreement marks a significant advancement in enhancing connectivity for consumers and businesses across the country.

This summer, AST SpaceMobile plans to deliver its first commercial satellites to Cape Canaveral for launch into low Earth orbit. The initial five satellites will enable commercial service, building on key milestones achieved in 2023, including the first voice call, text and video call via space between everyday smartphones.

Chris Sambar, AT&T's Head of Network, will soon join AST SpaceMobile’s board of directors. AT&T will continue to collaborate with AST SpaceMobile on developing, testing and troubleshooting this technology to achieve comprehensive satellite coverage across the country.

The integration of space-based direct-to-mobile technology is designed to complement and integrate with AT&T’s existing mobile network. This approach aims to provide customers with connectivity in locations previously deemed unreachable, enhancing AT&T’s industry leadership in utilizing emerging satellite technologies.

AST SpaceMobile’s leadership has expressed enthusiasm about the partnership. The collaboration with AT&T is seen as a pathway to unlocking the potential of space-based cellular broadband, promising seamless, reliable service across the continental United States. This initiative will transform connectivity, especially in remote and hard-to-reach areas.

By investing steadily in infrastructure and pioneering new technologies, AT&T is well-positioned to bridge the digital divide and enhance the connectivity landscape nationwide. The satellite solution will eliminate dead zones, ensuring continuous two-way connectivity even in wilderness areas, national parks, rural highways and other remote locations. Consumers can look forward to enhanced peace of mind, knowing they will have reliable connectivity wherever they go.

With a customer-centric business model, AT&T is likely to benefit from the increased deployment of mid-band spectrum and greater fiber densification. An integrated fiber expansion strategy is expected to improve broadband connectivity for both enterprise and consumer markets, while steady 5G deployments are likely to boost end-user experience.

AT&T plans to deploy 5G+ service in various stadiums, arenas and practice facilities across the country, along with various company-owned retail stores, to revolutionize the shopping experience. In addition, the company aims to launch 5G+ in several airports while offering secure 5G facilities to the FirstNet network. The acquisition of mid-band spectrum (C-Band) further offers significant bandwidth with better propagation characteristics for optimum coverage in both rural and urban areas.

The stock has gained 4% in the past year compared with the industry’s rise of 10.2%.

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AT&T, currently, carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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