AT&T Plans To Double Wireless Network Investment

John Stankey, chief executive officer for AT&T's operations division, told The Wall Street JournalThursday that AT&T has been installing new radio boxes in New York and San Francisco and intends to continue erecting more cell towers in other areas of high bandwidth usage.

"We expect improvements in both markets in the coming months," Stankey told the Wall Street Journal.

AT&T plans to spend between $18 and $19 billion on network upgrades this year, a figure that includes a doubling of its wireless network investment from last year, The Wall Street Journal reported.

AT&T has been under a microscope over the growing flood of iPhone subscriber complaints over 3G service. AT&T has suggested that it may have to institute usage-based pricing to deal with the disproportionate amount of bandwidth being consumed by iPhone users.

With the 3G iPad slated to arrive by May, AT&T is facing even more questions about how it plans to deal with the additional traffic the device will drive. According to Vince Bradley, CEO of Malibu, Calif.-based master agent World Telecom Group, AT&T needs to increase the backhaul connections at the towers more than it needs to add new cell towers.

"In general, most cell towers only have between 1 to 3 T1s, yet consumers are told they can see speeds of up to 3.6Mbps. So more T1s will help alleviate the bottleneck, but ultimately for the dense metro areas with tens of thousands of users moving between sites, they need to use fiber or DS3s to keep the traffic flowing and customers happy," Bradley said.

Stankey's comments will help quell some of the criticisms that have been leveled at AT&T, but devices like the iPhone and iPad are only beginning to scratch the surface as development platforms. With new bandwidth apps arriving on the App Store every month, it looks like AT&T's battle to keep up with wireless bandwidth demand will be an ongoing one.