announced that it will spend $1 billion in 2008 to improve and expand its Internet Protocol (IP) networks for large businesses with enterprise networks. AT&T indicated that the expenditure is being driven by a huge increase in voice, data and video traffic.
The investment represents an increase of 33 percent over 2007 and almost a 50 percent increase over 2006. In Q4 of 2007, AT&T's Global Business Services unit hosting revenues increased by 19 percent, enterprise IP data services by 20 percent, and VPN revenues by 31 percent. Considering the sluggish U.S. economy this represents an impressive amount of growth.
The expansions for 2008 planned by AT&T include adding DSL (digital subscriber lines) as an access alternative in China, Finland, Norway and Saudi Arabia; adding subsea fiber-optic cable capacity to Japan, Asia and the Caribbean.
AT&T will also be importing cable servicing to the Middle East and India; providing enhanced Ethernet network capabilities, including rolling out a global private LAN in the U.S., Asia and Europe at first, then in 14 international cities, with Ethernet footprint capacity in 39 total countries by the end of this year; adding new Multi-Protocol Label Switching (MPLS) routers in the U.S., Europe and Asia, as well as network access nodes in major world cities and other countries to follow.
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