AT&T announced that it is buying core routers from Cisco to upgrade its Internet backbone network. In a statement, AT&T said the upgraded network "carries data at 40 Gbps without the need for multiplexing (combining multiple digital signals into a single optical channel)…By year's end, more than 40% of the IP traffic carried over the company's backbone network will ride on this new-generation platform."

AT&T said the upgrade was in response to the increasing demand for "online video, photos, music and IP-based business applications," as well as part of an ongoing initiative to provide "one of the world's most extensive, capable and advanced IP/MPLS networks."

AT&T did not reveal the value of the contract with Cisco, but did say that it chose Cisco's CRS-1 router due to its "flexibility and scalability."