AT&T Sues California Regulators For Trying To Make Broadband Affordable

from the this-is-why-we-can’t-have-nice-things dept

Five years years ago AT&T effectively stopped selling DSL and started hanging up on DSL and copper phone line customers. While killing landlines and DSL is understandable given the limitations of the dated copper-based tech, the problem is that thanks to concentrated telecom monopolization, many of these customers were left without any replacement options due to a lack of competition.

There are other issues at play too. AT&T has, for decades, received countless billions in tax cuts, subsidies, merger approvals, and regulatory favors in exchange for building infrastructure it either didn’t complete, didn’t maintain, or didn’t upgrade. There’s a rich back history of AT&T taking taxpayer money and then failing to deliver upgrades that were promised local municipalities.

Many of folks impacted by AT&T’s decision to hang up on copper are rural or elderly folks who relied on traditional landlines for reliable 911 access but are either outside the range of cellular, or find cellular to be less reliable and significantly more expensive on fixed budgets. The system has a tendency to downplay or ignore these folks.

So you can see how there’s a tension between private telecom monopolies and public interest regulators (the few we still have) tasked with protecting taxpayers and the public interest.

In 20 of the 21 states AT&T operates in, its lobbyists have managed to sell lawmakers on eliminating Carrier of Last Resort (COLR) obligations requiring it provide landline telephone service to any potential customer in its service territory. It’s easy to lobby lawmakers on the idea that the company needs to “move forward past outdated regulations,” and ignore the actual real-world impact or AT&T’s rich history of subsidy fraud or limitations of wireless as a fixed-line alternative.

But they’ve run into trouble in California, after the California Public Utilities Commission (CPUC) told AT&T in 2024 it can’t just hang up on these unwanted (taxpayer subsidized) connections. The CPUC said it’s not blocking AT&T from retiring its aging copper networks, but it wants some AT&T dedication to upgrading failing infrastructure to more modern fiber, not just throw “good enough” wireless at the problem.

Last week AT&T sued California and CPUC (full lawsuit here). AT&T is also asking the Trump FCC to intervene and prevent the CPUC from doing its job. AT&T, for its part, sells this as a story of California leveraging outdated regulations to block AT&T from embracing modernization:

“The federal government and virtually all States where AT&T historically offered POTS [Plain Old Telephone Service] have now eliminated outdated regulatory obstacles, allowing AT&T to begin powering down its POTS network and increasing its investments in modern communication technologies. California stands alone in resisting this progress.”

CPUC counters by saying they don’t want customers who used to have reliable landline service shoveled off to costly and less reliable wireless services instead of fiber. Or left without any connection whatsoever after spending the last four decades slathering AT&T with subsidies.

But it’s worth noting that AT&T’s legal assault is about more than just the fate of dying copper landlines.

California’s CPUC has been filling the void left by Trump regulators and attempting to ensure U.S. broadband is somewhat affordable. That’s involved conditions affixed to grants, affordability conditions applied to recent telecom mergers, and public safety requirements in response to climate-related risks. AT&T, as you might expect, doesn’t like that. Their goal is, with no hyperbole, no oversight at all.

So in addition to this lawsuit, they appear to be leveraging Dem politicians (like Assemblymember Tasha Boerner) in the state to push amendments to the state constitution that would strip the CPUC of its independence, ensuring that AT&T would have more direct lobbying control over the CPUC’s makeup through its robust lobbying control of state legislators.

The changes, which were approved by a California State Assembly vote (67-1), would need to be voted on by California residents later this year. As such, they are being sold to local state folks as a way to keep CPUC focused on soaring electrical utility rates. But the timing of the effort to limit CPUC’s oversight of broadband, just as AT&T tries to deliver the killing blow to the agency, is hard to miss.

Ultimately the broader narrative in the press sold to voters will be that California regulators are engaged in broad over-reach and hampering AT&T’s potential innovation. Downplayed or ignored will be the fact that federal consumer protection has largely been destroyed, and semi-independent regulators like the CPUC in a handful of states are the last line of defense in a country being devoured by corruption.

It’s a lopsided fight that historically telecom monopolies tend to win, which is why, as you can see with your own eyes, most U.S. broadband is patchy, expensive, sluggish, with abysmal customer service. Instead of empowering regulators that protect affordability and competition, we have a nasty tendency to lobotomize them on behalf of “free market competition” that isn’t real, and that monopolies don’t want.

Filed Under: affordability, california, california public utilities commission, cpuc, dsl, fiber, telecom, upgrades

Companies: at&t