“Given our high smartphone numbers, double our closest peer, in both markets, we have large population centers, very sophisticated users with high expectations, and very high volumes,” John Stankey, president and CEO, AT&T Operations said during the call.

“For example, in the dense areas of New York City, there are periods during the week when nearly 70% of the devices active on the network are data-intensive handsets. So, raising performance levels in these two markets is the organization’s top priority. We’re putting all the resources available against the issue and we’re closing the gap.”

Okay, great. What does that mean? Between $18 billion and $19 billion in 2010 capital expenditures–approximately $2 billion of it for additional wireless network and back-haul investment, for one thing. For another, 2,000 new cell sites. Finally, the company is upgrading existing cell sites with fiber for better 3G speeds.

Now, a few more NYC-SF specifics from Stankey:

We’re adding third and fourth radio network carriers to maximize capacity on available spectrum. In Manhattan specifically, now that we have scalable cell site controllers in place throughout most of the island, we’re intensely focused on putting more radio capacity on the street. We’ll increase the amount of 3G spectrum and radio capacity by one-third in high volume areas of the island by the end of the first quarter.

While we are through the majority of our zoning challenges in the Bay area, we’ll continue to work the remaining issues we have in parts of the Financial District and a handful of other locations to final resolution. We’re adding cell towers; and over the coming months, we’re building and upgrading high-capacity antenna systems to boost performance in high-traffic areas like stadiums, convention centers, and public transportation routes.

So will be see significant improvement in both markets in the coming months? Perhaps. Certainly, AT&T is suggesting we can expect one. And, as Stankey noted this morning, “Today a dollar in wireless investment yields twice the capacity than it did a year ago.” Let’s hope so–especially in markets like New York and San Francisco.

PREVIOUSLY:

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According to TownHall Investment Research, AT&T (T) spent about $21.6 billion on its wireless network from 2006 through September 2009. Meanwhile, Verizon (VZ) spent $25.4 billion. That disparity in investment, says TownHall Investment Research analyst Gerard Hallaren, has caused AT&T’s network to perform poorly compared with Verizon’s, particularly as it struggles to meet the data demands of devices like Apple’s (AAPL) iPhone.

Making matters worse, AT&T invests more in its wired infrastructure than in its wireless network, says Hallaren. Though 57 percent of the company’s operating income comes from wireless and only 35 percent from wired services, wireless gets only 34 percent of the capital expenditures, while wired receives 65 percent.

In other words, AT&T has been shortchanging wireless at the expense of wired. And it’s been shortchanging its customers above all. According to Hallaren, AT&T spent $308 per subscriber on network improvements from 2006 through Sept. 2009. Verizon spent $353 per subscriber. Sprint spent $310.

That’s exactly the sort of network capital expenditure strategy that lands you in the pages of Consumer Reports–for all the wrong reasons.

To be fair, though, AT&T is increasing investment in its network. According to the Columbia Institute for Tele-Information’s Broadband in America Report, a study prepared for the Federal Communications Commission this past November, the carrier plans to spend $5.625 billion in 2010, $5.875 billion in 2011, $6.114 billion in 2012 and $6.347 in 2013. (See tables above; click to enlarge. The full report appears below.)

UPDATE: Reached for comment, AT&T took issue with TownHall’s report and its research methods.

“Town Hall does not provide a complete picture of AT&T’s significant investments to support our mobile broadband leadership,” a spokesperson told me. “They draw their conclusions on incomplete information. For example, fiber and bandwidth to cell sites are the most significant investments for mobile broadband, but they are booked to wireline. In 2009 we deployed five times the number of fiber-optic backhaul connections than we did in 2008. We spend time on a regular basis speaking with analysts about these issues, and we’d welcome time to do the same with Town Hall. AT&T supports 21 percent of the world’s 3G HSPA broadband customers, more than any other HSPA carrier worldwide (GSMA, August 2009) and twice the number of smartphone customers than any other U.S. provider. We would not be in a global leadership position without aggressive investment in our mobile broadband network.”

Broadband in America -2009 –

[Image credit: Columbia Institute for Tele-Information, Broadband in America Report, 11.11.2009]

According to its 10-K, the company “anticipates utilizing approximately $1.9 billion for capital asset purchases during 2010, including approximately $400 million for Retail facilities and approximately $1.5 billion for corporate facilities, infrastructure, and product tooling and manufacturing process equipment.”

That’s a wide range of potential applications–wider, in fact, than it has been in years past, as Caris & Company analyst Robert Cihra notes. “Interestingly…this year’s 10K added wording for purchases of ‘product tooling and manufacturing process equipment’ which could imply Apple reversing course to actually build certain products/components in-house,” Cihra said in a note to clients today. “Beyond that are signals of Apple investing in massive new data center capacity (e.g., North Carolina) that could support anything from iTunes/iPhone Apps through new ‘cloud computing.’”

Sounds plausible. After all, there’s a lot a company like Apple could do with an additional $1.9 billion in capital expenditures. Certainly, an iTunes TV subscription service would require some investment. A tablet/slate device might as well. Whether that’s where this money is headed–if it’s headed anywhere at all–remains to be seen. Who knows, perhaps Apple intends to blow it all on CEO Steve Jobs’ dream of the “ultimate computer factory.”

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No area of technology will be immune to the decline. Hardest hit: the computer hardware sector, which is expected to see spending fall 15 percent to $324.3 billion. Seems even the promise of government stimulus packages won’t be enough to offset this ugly near-term outlook. Said Gordon, “Economic conditions have continued to erode business confidence in all regions. There is a continued general sense of uncertainty in the market and a lack of clarity of actual amount of toxic debt out there. IT organizations will look for ways to shift spending from capital expenditures to operational efficiencies.”