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AT&T threatens to stop investment that wasn't going to happen anyway
As we recently discussed at Android Authority, President Obama has finally come out and made it clear that he supports the reclassification of ISPs under Title II in order to protect network neutrality. Internet Service Providers (ISP) have since come out and released their own statements condemning President Obama’s idea. Generally, ISP’s prefer that we “trust them” to follow rules that they themselves don’t follow.
Now, AT&T is making an actual threat against those who support net neutrality.
AT&T says it won’t budge on a new project: at a conference today, CEO Randall Stephenson said AT&T would stop investing in a plan to bring high-speed fiber connections to 100 US cities until the FCC determines a path for internet regulation. – Reuters & TheVerge
Except, AT&T has already been doing this across the board for years now. As this site talked about months ago, AT&T has had a freeze on many wireline and wireless capital expenditure projects heading into 2014. In fact, some on Wall Street have been wondering why AT&T is trying to spend $50 billion on DirecTV rather than actually investing on their wireless business.
Craig Moffett tells Bloomberg News he doesn’t really see the point in the deal noting that satellite is a no-growth business. Jefferies analyst Mike McCormack believes that, “AT&T is better served preserving its balance sheet for upcoming wireless auctions, and continued investment in next generation wireless and wireline projects.” – AndroidAuthority
The threat of cutting back on their fiber projects is also laughable considering few will see such speeds through AT&T for many years. AT&T was forced into matching Google Fiber in Austin with their 1 Gbps speeds. Since then, AT&T pumps out press release after press release talking about their Gigapower service coming to a number of different cities. Except, they never provide dates and have been telling investors for months now that they would not be spending much money on the initiative.
Remember, AT&T is the same company who has failed to live up to pretty much any of their promises in past mergers.
- In 2004, AT&T promised to provide 100 Mbps line to “everyone home” in their footprint if allowed to merge with SBC.
- In 2007, AT&T promised to broadband to 100% of home if allowed to buy Bell South.
- In 2011, AT&T promised to bring 5,000 jobs to the US and rapidly expand their 4G wireless service if allowed to merge with T-Mobile.
- In 2014, AT&T promises to quickly build out their 1 Gbps service if allowed to buy DirecTV.
To steal a line from Karl Bode at DSLReports, “AT&T just fiddles with numbers, tinkers with technology definitions and reconstitutes deployment projections as needed to create artificial deployment gaps, then promises they’ll fill those gaps if regulators give them what they want. Rinse, wash, repeat, with neither the regulators or the press bothering to notice.”
Gigapower is nothing more than a project that AT&T wants to use for PR to show that they are competing against Google Fiber. So, be afraid everyone. AT&T is threatening to take away something that nobody (outside of Austin, Texas) was going to get anyway!