Mississippi Says AT&T Took $283 Million For A Network It Never Fully Deployed

from the Charlie-Brown-and-Lucy-Football dept

We've noted for years that the U.S. simply adores throwing billions in tax breaks and subsidies at telecom monopolies in exchange for broadband networks that somehow, mysteriously, only wind up half deployed. AT&T's particularly gifted at this particular grift, routinely promising a massive boost in network investment if it gets merger approval, deregulation, or subsidization. Like most recently when it nabbed a $42 billion tax break from the Trump administration in exchange for not only network investment that never happened -- but 41,000 layoffs.

Because AT&T's so politically powerful -- and of course all but bone grafted to the intelligence and law enforcement communities -- the company never faces more than a wrist slap for its empty promises, if that. This month it's the state of Mississippi that's pissed off, accusing AT&T of taking $283 million from the FCC's Connect America Fund to deploy broadband to 133,000 locations in Mississippi, then once again failing to deliver. More specifically, AT&T promised it would use the money to expand fixed wireless service to these locations, then falsely reported the locations served when they weren't.

The Mississippi Public Service didn't really mince words in a letter (pdf) spotted by Ars Technica sent to the FCC:

"Our investigation has found concrete, specific examples that show AT&T Mississippi has reported location addresses... as being served when, in fact, the addresses are without service under their [Connect America Fund] obligations," said a letter to the FCC sent Tuesday by all three Mississippi PSC commissioners. "This pattern of submitting false data to the USAC [the Universal Service Administrative Company, which administers the program on the FCC's behalf] merits a full compliance audit by the FCC, USAC, or whichever appropriate agency. We feel it is our duty to alert you to this issue."

This is far from the first time AT&T has misrepresented its broadband availability. The company back in April was forced to admit to the FCC it misrepresented broadband availability across 20 states in its territories. AT&T's also fighting efforts to improve broadband map accuracy on several fronts. In a news release, Public Service Commissioner Brandon Presley urged the FCC to investigate what it called a history of inconsistencies and falsehoods:

"Our investigation has revealed a wide array of inconsistencies in what AT&T advertises as available and what actually exists when consumers try to get Internet service," Presley said. "All the while, AT&T has submitted data saying that they have used federal funds to bring Internet service to these specific homes. AT&T knows, for a fact, that information that they have provided regarding where their Internet service exists is false. They know that through their own, internal records. It's imperative that the FCC and other appropriate federal agencies work with us to hold them accountable."

Of course this is where an independent federal regulator would investigate AT&T more deeply, especially given more than two decades of similar complaints. But that of course isn't going to happen at Ajit Pai's FCC, which is not only a glorified rubber stamp for the industry it's supposed to be holding accountable to the public, but routinely participates in the industry's willful misrepresentation of broadband availability to try and hide the patchy coverage and muted competition that is the hallmark of the U.S. telecom industry.

Understand this: the FCC actively and routinely helps telecom monopolies misrepresent broadband availability and downplay high prices to try and obfuscate market failure. Regulatory capture remains a massive problem, no matter how many telecom-funded consultants, think tankers, and politicians try to convince you that U.S. broadband is a miracle of free market innovation.

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Filed Under: connect america fund, digital divide, fcc, lies, mississippi, unkept promises
Companies: at&t


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  • identicon
    Anonymous Coward, 6 Oct 2020 @ 7:12am

    So where should the 'STUPID' label be pinned then? Not on AT&T, obviously but on the fucking idiots who handed over the money, on the FCC for not continuing what Wheeler had so bravely started, preferring to do as this and other companies wanted and on those who won't demand the monies back or prosecute for fraudulently obtaining the monies and not fulfilling obligations

    reply to this | link to this | view in chronology ]

    • icon
      That One Guy (profile), 6 Oct 2020 @ 9:44am

      Openly corrupt as hell? Absolutely. Stupid? Not really.

      For the most part, none of those groups would be a fitting place for the dunce cap, as it's only stupid if they didn't know what was going on, and most of them almost certainly knew full well what would happen they just didn't care so long as they got their cut.

      reply to this | link to this | view in chronology ]

  • icon
    Samuel Abram (profile), 6 Oct 2020 @ 8:06am

    Reason for AT&T's grift…

    You think AT&T is trying to scramble all the funds they could after their purchase of Warner Bros. and all the subsidiaries (inc. HBO and DC Comics)?

    reply to this | link to this | view in chronology ]

    • icon
      James Burkhardt (profile), 6 Oct 2020 @ 8:15am

      Re: Reason for AT&T's grift…

      It goes back decades. The grift is just AT&T's business model. Hell, Subsidy grift by corporations is pretty much an american past-time.

      reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 6 Oct 2020 @ 8:34am

    Something something you know the only people ever charged for ripping off this fund where the ones who took vacations with the cash.
    Imagine if there was an agency that would actually audit the claims vs reality & then clawback all the ill gotten cash, interest, & penalties.

    reply to this | link to this | view in chronology ]

  • icon
    That One Guy (profile), 6 Oct 2020 @ 9:39am

    'The transfer cleared, so looks like you're innocent.'

    Companies like AT&T manage to get away with this scam time and time again because while they're really bad at connecting the public to the internet one connection that is always kept up and in pristine condition is the one between their bank account and the 'campaign funds' of the politicians that defend them, who you can bet understand quite well that if they attempt to crack down on the likes of AT&T those 'donations' are likely to dry up as the company looks for more 'industry friendly' politicians to support.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 6 Oct 2020 @ 9:43am

    Of course AT&T is corrupt and has many particular failings, but the real lesson of this story is that Mississippi shouldn't be giving 283 million dollars to any private company in the first place.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 6 Oct 2020 @ 7:39pm

      Re:

      While that is something states mostly shouldn't be doing, that isn't what happened. The state which gave AT&T the money this time was the federal government, from a fund explicitly designed for this, with a name that says so.

      reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 6 Oct 2020 @ 11:30pm

      Re:

      So, you're saying that instead of paying experts in the field to do the job they do for millions of paying customers across the country, the government should try and start from scratch using only government employees with no expertise in those fields? Yeah, I'm sure that would work brilliantly /s

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 7 Oct 2020 @ 8:25am

        Re: Re:

        Nope. They should take the companies by eminent domain, consolidate the networks, and let the expert employees actually do their jobs.

        The telecom companies aren't effectively "private companies" to begin with. There is no "free" market at work, and nobody alive remembers a time when there has been such a market. In fact, there was never such a market on any significant scale.

        There are massive subsidies explicitly meant to provide services to people that a pure "free" market would not serve (looking at you, rural residents). There's pervasive regulation of almost every aspect of the business. There are not only very large natural barriers to entry, but enormous artificial, government-created barriers to entry.

        It's stupid to pretend that's a market system; it has market elements, but it's basically shaped by command and control.

        Add concentration, partly caused by the actual economics of the service and partly caused by the same government actions. Then add the predictable regulatory capture. Now what you have is a government-sanctioned method for transferring public money to the private members of an oligarchy.

        Time to admit it and clean it up.

        reply to this | link to this | view in chronology ]

        • icon
          PaulT (profile), 7 Oct 2020 @ 11:11pm

          Re: Re: Re:

          So, don't even bother working with private citizens, just claim that entire industries are now government property? Yeah, that will work well...

          The question then remains why your country is apparently so hopeless at this that seizing entire industries is the only way to get results in your mind, whereas most of the rest of the world have managed to get far better results without doing that.

          reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 6 Oct 2020 @ 1:59pm

    Always wondered.

    After the Gov. paid off the telecoms, to run lines into the RURAL areas.. Did the corps make any moreny from it, or is it that the made LESS from those rural areas, then they wanted?
    But even after the fact, the gov. kept paying off the Telecoms every year, to keep it up.
    Or did they think it was a Write off on taxes?

    Over time I would think that the Major metro Corps, would be the Big money, and Big demand, but they needed access to all the Citizens to use some of that power.
    Their only job now is charging people to make Phone calls, and taking any money from anyone that wishes to use the lines. But the lines have to be up and to as many as possible. But they stopped seeing the point, that everyone needed access, so that Sellers can make money, and they could charge for that access.

    So, you play the game. get the Gov. to TRY to push the corp buttons. 1/4 trillion is about 6-8 CEO wages worth?? But the prices didnt even go down after that.
    Would love to see the contracts being made between the Movie, channels, HBO, and soforth to really see how much is being passed back and forth. But thats PRIVATE CORP BUSINESS.

    Then comes the other parts. The TV/CABLE industry and the internet. All rolled up into 1 big BANK.
    The Cable part is interesting, because of the wireless built into it for distribution, and I WOULD think that the Corps would Love to do this to everyone, and not use the Backbone. Wireless to Each reagion/area and then Cable to the locals. But its not happening, the way it should.
    How many Sats would you need? To have interactive, up/down/back and forth Data to cover 1 metro area? Millions of people using the system to talk/internet/cable/sat.
    Ask the Digital Sat services how hard it is already, Just to have FULL band TV access. Then ask the Cable distribution how much fun it is to Scramble and send it to everyone.
    The Whole system gets complicated, and Lag, and weather, and this and that.
    Would it be nice if you could have it all in 1. Phone, wireless, Cell, Cable TV, All at 1 low price on 1-2 fiber cable to your home for $100 per month?
    But, But Fiber is probably better underground, NOT on poles(Weather sucks, and Temps change how things work). But do they see how this could work.
    Every home could/would be a great Small location for cellphone service, and you wouldnt NEED HUGE Antenna's, and the coverage would be RIGHT down the freeway's. A nice box on everyones home giving all the services anyone wanted.
    But the caveat. Tends to be that the Major Backbone does not Cover everywhere. Its not under the Freeway, Everywhere.
    If it was, then it would be nothing to install remote locations in every small town. There are Tons of back roads to areas not covered, not near the freeways. Go to sun valley, and there is not much there, anyone take a Fiber up the mountain area would be Kissed, and get paid TONS for a Roaming signal. How would $1 per connection feel, and you would cover 3 towns along the way.(at least) All owned by rich people.

    reply to this | link to this | view in chronology ]


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