AT&T Has To Walk Back Its Empty Bluff About Freezing Fiber Deployment Because Of Title II

from the please-whatever-you-do-don't-check-our-math dept

When the President last month voiced his surprising and clear support for reclassifying ISPs under Title II, AT&T engaged in some very AT&T-esque pouting, proclaiming that the company would be freezing expansion of its next-generation "Gigapower" fiber deployments:
"We can't go out and invest that kind of money deploying fiber to 100 cities not knowing under what rules those investments will be governed...We think it is prudent to just pause and make sure we have line of sight and understanding as to what those rules would look like," added the CEO."
Except, as I noted at the time, AT&T's deployment promises were a bluff to begin with (what I like to call fiber to the press release). AT&T's been bumping speeds for a few high-end developments in cities around the country where fiber was already in the ground, then pretending that the deployments are much larger than they actually are. The goal is to save face in the age of Google Fiber, and give the mostly-bogus impression that AT&T's seriously competing. In reality, AT&T had again cut its fixed-line CAPEX by about $3 billion -- three days before the President's announcement -- and it's backing away from millions of DSL users it doesn't want to upgrade.

This is nothing new to AT&T. The company has a very long and proud history of using broadband deployment as a carrot on a stick to get what it wants from regulators (whether that's buying BellSouth, buying T-Mobile, buying DirecTV, or pushing for deregulation). AT&T's numbers are frequently distorted or outright fabricated, and regulators historically don't question them. This time, AT&T's bluff didn't work so well -- because somebody in government decided to actually pay attention.

Jamillia Ferris, a former Justice Department antitrust lawyer aiding the FCC in reviewing AT&T's DirecTV acquisition plans sent a letter to the FCC asking AT&T to detail the company's fiber deployments. In a response (pdf) letter to the FCC, AT&T insists that the FCC had the company all wrong. You see, AT&T claims, the company wasn't threatening to freeze ongoing fiber deployment, it was threatening to freeze fiber deployment beyond existing promises (though Stephenson's statement very clearly doesn't say that):
"The premise of the Commission’s November 14 Letter is incorrect. AT&T is not limiting our FTTP deployment to 2 million homes. To the contrary, AT&T still plans to complete the major initiative we announced in April to expand our ultra-fast GigaPower fiber network in 25 major metropolitan areas nationwide, including 21 new major metropolitan areas."
The majority of the document is of course redacted, and you'd be hard pressed to get the government to conduct a proper audit of either AT&T's real broadband deployment numbers or the billions in subsidies received over the years to help fund them. While it's amusing to see regulators call AT&T's bluff for once, the telco will surely return to using the same old phantom-broadband-carrot-on-a-stick routine a few months down the road.

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  1. identicon
    Michael, 2 Dec 2014 @ 11:22am

    We can't go out and invest public money to help a company deploy services to 100 cities not knowing what contract terms will be imposed on the citizens...We think it is prudent to just pause and make sure we have line of sight and understanding as to what those contracts would look like

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

  2. identicon
    Anonymous Coward, 2 Dec 2014 @ 11:37am

    Can the Feds claw back all the taxpayer subsidies that AT&T has failed to deliver on? Seriously let's give it to all these towns that want legit gigabit broadband

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

  3. icon
    Havok091 (profile), 2 Dec 2014 @ 11:47am

    Re:

    Speaking of public investment, it's very nice to see some proactive lawyering on behalf of the FCC (and The People).

    On a side-note, I've been trying to find the specific name of that government policy to lay down unused fiber during all capital construction with the intent to lease it down the road...anyone?

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

  4. icon
    Uriel-238 (profile), 2 Dec 2014 @ 11:50am

    These days, subsidies seem to be disassociated with any actual purpose

    So it really comes down to which companies can convince the state to pay them money.

    No reason. No need to worry about reciprocity or creating an actual product. Just free money.

    From the government.

    From the taxpayers.

    From you.

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

  5. identicon
    Michael, 2 Dec 2014 @ 11:54am

    Re: These days, subsidies seem to be disassociated with any actual purpose

    No. Clearly convincing the US government to pony up some taxpayer cash is the easy part.

    It comes down to which companies can weasel out of the terms attached to that money without the US government closing them down.

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

  6. identicon
    Anonymous Coward, 2 Dec 2014 @ 1:31pm

    Re: Re: These days, subsidies seem to be disassociated with any actual purpose

    Those companies which are "big enough" to not fail, of course.

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

  7. identicon
    Anonymous Coward, 2 Dec 2014 @ 1:45pm

    Re: Re: Re: These days, subsidies seem to be disassociated with any actual purpose

    Nah, you mean, "Too Big To Not Corrupt Us Politicians".

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

  8. identicon
    Anonymous Coward, 2 Dec 2014 @ 2:19pm

    "We can't go out and invest that kind of money deploying fiber to 100 cities..."

    "expand our ultra-fast GigaPower fiber network in 25 major metropolitan areas"

    Perhaps my math is wrong, but isn't 25 less than 100? I feel AT&T is being extremely misleading. If not outright dishonest in their statements.

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

  9. identicon
    Anonymous Coward, 2 Dec 2014 @ 3:20pm

    I'm sure the careful wording of Title II will still tilt in favor of the big ISPs , wouldn't be the first time the lobby has stacked the deck and played both sides.

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

  10. identicon
    Anonymous Coward, 2 Dec 2014 @ 6:15pm

    Re: Re:

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

  11. identicon
    Rudyard Holmbast, 2 Dec 2014 @ 7:19pm

    "When the President last month voiced his surprising and clear support for reclassifying ISPs under Title II..."

    For fuck sake, the way the authors on this site pretend that since our "president" now supports so-called "net neutrality", there can no longer be any legitimate opposition to it is fucking annoying. A majority of the entries I have read on this subject either start with or contain a variation of the above quote, as if Barack Obama's support of something is some game-ending trump card.

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

  12. identicon
    Anonymous Coward, 2 Dec 2014 @ 10:28pm

    Re:

    Meanwhile all you ever do is fellate Mark Cuban as if ending net neutrality is some magical bullet to music piracy.

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

  13. identicon
    Anonymous Coward, 3 Dec 2014 @ 1:13am

    Re:

    You're right int hat TII isn't the be-all and end-all for Net Neutrality a sa concept. However, as part of a package of measures, it's a solution.

    And actually, Obama did voice clear support for the reclassification.

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

  14. icon
    Havok091 (profile), 3 Dec 2014 @ 9:48am

    Re: Re: Re:

    Thanks for your answer, it refers to a different set of incentives though.

    I read a very specific name for this type of a proactive building of infrastructure as automatically part of (even unrelated) capital investment that requires digging as a public public policy (probably here, maybe at Ars) and have been unable to find its name again

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


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