Wireless and Fiber Investments Position AT&T Well, but at a High Cost

We believe AT&T's investment in its fiber and 5G wireless networks has strengthened its competitive position. These investments don't come cheap, however. Maintaining pricing discipline will be crucial to earning attractive returns on capital, but competitive intensity is ratcheting up, with firms pushing to maintain growth as the wireless and broadband markets rapidly mature. We expect rational competition to prevail over the longer term, with only a modest impact from satellite providers like SpaceX. However, irrational competition remains a risk as the shape of the telecom industry changes.