Everytime AT&T Wants Federal Approval Of Merger Or Policy, It Promises It's Necessary To Deliver 100% Broadband... Then Doesn't Deliver

from the because-fulfilling-promises-is-hard dept

Tue, Jun 24th 2014 4:39am — Mike Masnick

We've covered in the past how Verizon has a long history of making promises to regulators to get special deals, and then never delivering. Usually these promises involve providing high speed fiber to the home connections, for which they get massive tax breaks and subsidies... and then never delivering. And, if people finally point out that it didn't deliver, it lobbies to drop the requirements that it had agreed to abide by (but never actually did). Of course, there's a very similar story with AT&T, and telecom analyst Bruce Kushnick, who's been the leading voice on these broken promises for years, has the details. In fact, what he notes is that AT&T has made some rather specific promises about providing broadband to get approval of mergers, but has never delivered. And now it's doing the same for its attempted merger with DirecTV.

He notes that, first, AT&T (then called SBC) promised a massive fiber broadband in 2004, as part of convincing the FCC to kill off open access requirements for fiber optic networks. So did BellSouth (eventually bought up by AT&T). And yet, the numbers they promised were never met. Because, of course they weren't. Then, when the AT&T was buying BellSouth a few years later, it promised to offer 100% broadband penetration.

If you can't see that, all you really need to know is that it says "By December 31, 2007, AT&T/BellSouth will offer broadband Internet access service... to 100 percent of residential living units in the AT&T/BellSouth in-region territory." Okay. Now, remember that, and fast forward to today. As you know, AT&T is trying to buy DirecTV, and one of the reasons it's citing for the merger is... that it will help bring broadband to 15 million customers that don't currently have broadband. Here's the press release.

AT&T will use the merger synergies to expand its plans to build and enhance high-speed broadband service to 15 million customer locations, mostly in rural areas where AT&T does not provide high-speed broadband service today, utilizing a combination of technologies including fiber to the premises and fixed wireless local loop capabilities."

Huh. As Kushnick points out: "If AT&T is already supposed to have 100% completed, how can 15 million locations -- at least 20% of all AT&T areas, not already have high speed broadband?" This certainly suggests that AT&T just flat out lied to help get the earlier merger completed.

Meanwhile, Karl Bode is pointing out that it's not just on the wireline side that this happens. Jump over to the wireless side, and its attempted (but failed) acquisition of T-Mobile, and you'll find a similar story:

AT&T does the same thing with wireless. Back when AT&T was trying to get approval to acquire T-Mobile, the company shot itself in the foot by accidentally posting a confidential document showing it would cost AT&T just $3.8 billion more to go from 80% nationwide LTE coverage to 97% coverage, something AT&T had been claiming was only possible if they were allowed to pay $39 billion to eliminate T-Mobile.

Of course, what we've now learned is that the telcos appear to know that they can pretty much say whatever they want, as long as it sounds good, because no politician or regulator is likely to ever look back and call them out on their previous unmet promises.

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Filed Under: broadband, competition, fcc, ip transition, mergers, net neutrality, promises
Companies: at&t, directv

29 Comments

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Violynne (profile), 24 Jun 2014 @ 3:23am

"...because no politician or regulator is likely to ever look back and call them out on their previous unmet promises."
There's a sense of comic justice in this sentence, but I can't quite put my finger on it.
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Anonymous Coward, 24 Jun 2014 @ 4:51am

"merger synergies "

How do they keep a straight face when saying such things?
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Karl Bode (profile), 24 Jun 2014 @ 5:20am

Re:
Just picture big bags of money. It's also easy when the regulators you're bullshitting just nod dumbly all the time.
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Chronno S. Trigger (profile), 24 Jun 2014 @ 5:22am

If DirectTV is the answer to 15 million people getting "enhanced" broadband service, that means that no only did AT&T not roll out Fiber to 100% of their customers, they didn't roll out DSL to 100% of their customers. And if 20% of their customers are getting "fixed" with satellite, how many of their customers would still be screwed?
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Anonymous Coward, 24 Jun 2014 @ 5:27am

Re:
"how many of their customers would still be screwed?"

All of them, of course.
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Anon E. Mous (profile), 24 Jun 2014 @ 5:46am

At least AT&T is consistent in their failure to live up to their promises and expectations.

I feel sorry for Direct-TV customers, if they think their service sucks now, wait till AT&T starts issuing directives and changing things in the name of cost savings
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Anonymous Coward, 24 Jun 2014 @ 5:48am

Dear AT&T
Complete your promises made ten years ago, and fix your shit before asking for more.

Regards,
The US Public.
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Michael, 24 Jun 2014 @ 5:57am

Instead of approving mergers, we should be forcing AT&T to break up into smaller pieces.
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Anonymous Coward, 24 Jun 2014 @ 6:21am

And they would gotten away with it if those meddling peasants and their working internets...
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Anonymous Coward, 24 Jun 2014 @ 7:29am

New Law!
Any government official approving a new merger or policy for any organization that made a promise towards a past merger or policy item, but failed to deliver upon that promise without restitution shall have committed a felony with a minimum penalty of 5 years prison and prohibition from serving in any future public office or employment that interfaces with any public office.
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ofb2632 (profile), 24 Jun 2014 @ 8:48am

Make them go back and deliver all the promises
In order to merge, each telco should be force to go back to every community they had made promises to and fix each and every promise they broke
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Fred, 24 Jun 2014 @ 9:38am

Re: Re:
Who is BSing?

This article claims AT&T promised 100% fiber, then cites a commitment to 200kbps broadband.
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kitsune361, 24 Jun 2014 @ 9:43am

As someone who lives in SBC's old territory
This 100%, 200mbit fiber coverage in 2007 comes as a surprise to me. Just moved apartments and AT&T was an option and I couldn't get more than a 48mbit connection (which cost ~$60 w/ $150 in setup fees AND a 1yr contract).

They are pretty consistently screwing with my parent's 6mbit DSL service across town, all while bombarding them with offers to switch to U-verse (for only twice what they're paying for DSL). Not a week goes by that I don't hear about some sort of service interruption in their neighborhood.

Par for the course, it seems.
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John Fenderson (profile), 24 Jun 2014 @ 10:04am

Re: Re: Re:
I believe Karl is referring to AT&T's bullshit in making their promises.
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Anonymous Coward, 24 Jun 2014 @ 10:56am

I work in an AT&T area. We currently have access to 22kbps dialup modem speeds. They once told us for only $5000 they would get us 1Mbps service. After paying and waiting 9 months, we gave up and got our money back.

They still don't offer even DSL to us - we are between two rural cities - about 7 miles each way. DSL is available within 1 mile of us in both directions. Over 500 people live in this unserved rural area.

We have DirecTVs satellite internet - horrible. While I can get high speed for 10-15 minutes, it quickly degrades to dialup speeds, making it a useless 4 year $120 a month contract, that cost us $500 in equipment up front.

Most of our employees jsut use their cell phones as mobile hot spots - they can get 1 bar of service if they position their phones perfectly. (AT&T & Verizon is available at 1 bar signal strength here).

Both companies show us as 100% covered. I've called before and their brilliant suggestion is to go outside to make calls or use the internet. Trying to use the service while moving is not advised. SMH

Yet, we continue to pay Universal Service Fee charges....
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nasch (profile), 24 Jun 2014 @ 11:08am

Re:
Instead of approving mergers, we should be forcing AT&T to break up into smaller pieces.

Again.
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nasch (profile), 24 Jun 2014 @ 11:09am

Re: As someone who lives in SBC's old territory
This 100%, 200mbit fiber coverage in 2007 comes as a surprise to me. Just moved apartments and AT&T was an option and I couldn't get more than a 48mbit connection (which cost ~$60 w/ $150 in setup fees AND a 1yr contract).

They promised 200 KILObit/s service, not 200 Mb/s, and didn't even deliver that.
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nasch (profile), 24 Jun 2014 @ 11:11am

Promises
Of course, what we've now learned is that the telcos appear to know that they can pretty much say whatever they want, as long as it sounds good, because no politician or regulator is likely to ever look back and call them out on their previous unmet promises.

They're probably very good about keeping the promises that the politicians cares about...
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Spaceman Spiff (profile), 24 Jun 2014 @ 11:26am

AT&T lies
AT&T had been trying to get me to subscribe to Uverse for my business internet connect for a couple of years now. They keep saying "fiber to the premises", but that's a lie. It is fiber to the neighborhood, unless you have a totally new building... I'd subscribe to Comcrap, but they are even worse than AT&T! We had a local attempt to provide city-provided fiber some years ago (blocked by big $$ and false propaganda by the such as AT&T and Comcrap). I recently spoke with my neighbor who voted against the initiative - he is sorry now that he did!
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Anonymous Coward, 24 Jun 2014 @ 11:35am

AT&T going door to door
Last evening, two young ladies were going door-to-door in my neighborhood on behalf of AT&T to sign up/switch people from whatever they have to the various Uverse products. I let them do their spiel about great interet speeds and Uverse bundles and then asked when AT&T was going to come into my yard and run the fiber into my house. 'Oh! That's the great thing! Nothing else will be needed. Your connection will come through your existing wires!' OK - where's the node? 'Just down the street & around the corner!! And so internet will be SUPERFAST!! And WIRELESS TV!! And it will only cost you a minimum of $120 a month [nearly twice what I am currently paying] under the Super Special Deal [for a year]!! And no $300 installation charge!! But a contract!!' Uh, no - I don't have a contract with TWCable and get the channels I want for almost half what Uverse would charge, so paying a boatload more money for more channels I don't watch and paying more for much the same internet over copper that I currently have (I have mid-range ATT DSL right now that works perfectly fine) is not exactly swaying me...
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John Fenderson (profile), 24 Jun 2014 @ 11:58am

Re: Re:
And this time we shouldn't allow AT&T to write the terms of the breakup.
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John Fenderson (profile), 24 Jun 2014 @ 12:00pm

Re: AT&T going door to door
Yeah, I've never understood exactly what the value proposition of Uverse is. It just looks like a way to pay a lot more for the same services.
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DogBreath, 24 Jun 2014 @ 12:30pm

Re: Re: Re: Re:
Whenever anyone is dealing with AT&T, it should be mandatory that this song is playing in the background.
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Anonymous Coward, 24 Jun 2014 @ 1:29pm

Re: Re: AT&T going door to door
so paying a boatload more money for more channels I don't watch and paying more for much the same internet over copper that I currently have

It makes money for content producers and cable distribution side of AT&T; there's the real value, selling people content they do not want or watch.
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That One Guy (profile), 24 Jun 2014 @ 3:01pm

Re: Promises
Exactly so, the ones making the decisions, from politicians to 'regulators' don't care, because the 'promises'(whether a juicy 'campaign contribution' or a nice cushy job once they're out of their current position) that the cable companies make to them are kept just fine.
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That Anonymous Coward (profile), 25 Jun 2014 @ 5:28am

Re: Re: AT&T going door to door
follow the law changes they got in several places.
If enough people sign up with a competing service and their wireline customers drop, they can exit offering POTS.
They will sell their lines off to this other company that happens to have a deathstar in the logo, cut out those they have to share the lines with, write off the selling and acquisition of the copper lines, and get people on VOIP.
Because Uverse is on their fiber network, except the end of it is still copper.... they leave that part out.
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That Anonymous Coward (profile), 25 Jun 2014 @ 5:30am

Why doesn't the government take a page from the AT&T playbook.
You go hook all these people up and we'll totally approve this once its done.
...waits....
Oh your all done now?
Good, we changed out mind about the deal. But thanks for hooking everyone up, now lets open those lines to competition.
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John Fenderson (profile), 25 Jun 2014 @ 7:57am

Re: Re: Re: AT&T going door to door
Yes, I understand the value proposition for AT&T. I don't understand the value to the customer. Why do people buy this thing? (Although I suspect that most don't -- I don't personally know anyone who does, anyway.)
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AnonyBabs, 25 Jun 2014 @ 9:48am

Re: Re: Re: Re: AT&T going door to door
In many cases (such as mine), it's because they are forced to. If you don't "sign up" to switch from DSL to U-verse, they will cut your DSL entirely. (I must admit, though, that I got a decent intro price and am currently saving money over my old service. Talk to me in a year or so, though.)
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