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Broken Promises: The Telecommunications Trust That Doesn’t Deliver

AT&T, Verizon, and cable companies like Comcast have quietly created the 21st century equivalent of the railroad monopoly, and are using their market power to raise rates, block competition, and supply inferior service to customers.

That conclusion comes courtesy of former telecom industry analyst Bruce Kushnick, who today serves as a consumer watchdog for the telecommunications industry’s broken promises and bad service.

Kushnick is chairman of New York-based Teletruth, a customer advocacy group that is spending a lot of time demanding Verizon finish the fiber optics network it promised would be available throughout states like New Jersey.

Kushnick has just completed a new e-book, the “$200 Billion Broadband Scandal” chronicling how the telecommunications industry has used power and influence to outmaneuver regulators and make promises they cannot or will not keep, for which they are never held accountable.

Kushnick’s view of the current state of broadband and telecommunications in the United States:

  • For the last 20 years, the nation’s major telecom companies have played the public and regulatory officials for fools – wrangling dramatic rate increases while making promises about fiber-optic cable they haven’t delivered.
  • The communications infrastructure is the most important thing to build back the nation’s economy.
  • The caretakers of America’s essential infrastructure have scammed us, big time, and it’s going to get worse.
  • The Federal Communications Commission is in the pocket of the phone companies.

Kushnick

Kushnick scowls over news Verizon, Comcast, and Time Warner Cable are about to cross-market cable and wireless phone service, calling it a textbook case of “Antitrust 101.”

Despite promises that the phone companies would bring extensive competition to America’s cable monopoly, the two competitors have effectively declared a truce.

In Kushnick’s view, phone companies like AT&T and Verizon are breaking their promises to regulators and consumers.

“Illinois Bell was supposed to rewire the state (with fiber-optic cable), starting in 1993 at an initial cost of $4 billion,” Kushnick said.

Instead, AT&T moved in and bought out the phone company and has dragged its feet on fiber deployment, along with most other big phone companies.

Kushnick told the Journal Star phone companies are going cheap avoiding fiber optic infrastructure while still ringing up huge profits.

“Every state is different. Pacific Bell stated they would spend $16 billion by 2000 on 5.5 million homes. Bell Atlantic claimed it would spend $11 billion on 8.75 million homes,” he said.

Verizon New Jersey said it would wire 100 percent of that state by 2010. Now there’s political action in New Jersey to hold the telecom accountable for failing to meet that goal, said Kushnick.

How do the companies get away with missing deadlines? “The phone companies have control of the regulators and a strong PR machine. The public is often unaware of what claims were made five or 10 years ago,” he said.

Kushnick is very aware. Take AT&T’s U-Verse service, so heavily advertised during NBA playoff games, for example. “(U-Verse) isn’t even fiber optic to the home but uses the old copper wiring,” he said.

While Kushnick puts a spotlight on the problem, the public would do well to bone up on what’s going on when it comes to the broadband services they pay so dearly for.

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  • BobInIllinois: My observation has been that Xfinity/Comcast will compete on speed if the local market is competitive. If they are the speed leader already, they won...
  • Josh: It's not where I am. There's a Fiber company available that's both way cheaper and way faster. I've wondered if they're trying to compete with that....
  • BobInIllinois: Xfinity must have goal to be fastest broadband speed in its markets....
  • john: So can they merge digi tier 1 and 2 together now and keep it at $12 since they are removing like 8 channels from it and it's basically just a crappy ...
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  • tim: Predicted cost for cable next year by November: $74.50 ( for the basic package, and when ever your beginning trial period ends with in the year of sig...
  • JACQUELINE SKIPPER: I have this problem with Spectrum. I would have to cancel and wait 3 months and I would if I didn't need my internet and the sabres games. they alway...
  • BobInIllinois: Frontier offers VantageTV in the Bloomington-Normal, Illinois area. They are competing with Comcast and MetroNet (a fiber overbuilder from Evansville...
  • L Nova: The DOJ should force AT&T to either sell OR spin off the unwanted copper wireline assets....
  • EJ: Do these "institutes" really think they are fooling anyone? This song and dance political moves is sickening at best. Most of these companies have dug...
  • jason: poor former Brighthouse members in a week it will be a year since SPP prices started for them. That means no one will be on the legacy first year pr...
  • jason: spectrum is on pace to be the worst cable company when it comes to speeds soon. They had no reason to remove the 200mbps option twc had. They will al...

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