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Read Between AT&T’s Landlines: What They Don’t Say Will Cost Kentucky, Other States

Phillip "Another year, another AT&T deregulation measure" Dampier

Phillip “Another year, another AT&T deregulation measure” Dampier

It’s back.

It seems that nearly every year, AT&T and its well-compensated fan base of state legislators trot out the same old deregulation proposals that would end oversight of basic telephone service and allow AT&T (and other phone companies in Kentucky) to pull the plug on landline service wherever they feel it is no longer profitable to deliver.

This year, it’s Senate Bill 99, introduced once again by Sen. Paul “AT&T Knows Best” Hornback (R-Shelbyville). Back in 2012, Hornback disclosed AT&T largely authors these deregulation measures and he introduces them on AT&T’s behalf. In fact, he’s proud to admit it, telling the press nobody knows better than AT&T what the company needs the legislature to do for it.

“You work with the authorities in any industry to figure out what they need to move that industry forward,” Hornback said. “It’s no conflict.”

While Hornback moves AT&T forward, “his” bill will move rural Kentucky’s best chances for broadband backwards.

AT&T always pulls out all the stops when lobbying for its deregulation bills. In Kentucky, AT&T has more than 30 legislative lobbyists, including a former PSC vice chairwoman and past chairs of the state Democratic and Republican parties working on their behalf. It has spent over $100,000 in state political donations since 2007.

The chief provisions of the bill would:

  • End almost all oversight of telephone service by the Public Service Commission anywhere there are more than 15,000 people living within a telephone exchange’s service area;
  • Give Kentucky phone companies the right to disconnect urban/suburban basic landline phone service and replace it with either wireless or Voice over IP service;
  • Allow rural customers to keep landline service for now, but also permits AT&T and other companies to effectively stop investing in their rural wired networks.

yay attThis year, AT&T apparently conceded it was just too tough to convince the legislature to let them disconnect hundreds of thousands of rural Kentucky phone customers at the company’s pleasure, so this time they have permitted rural wired service to continue, with some exceptions that make life easier for AT&T.

First, the end of oversight of telephone service means customers in larger communities in Kentucky will have no recourse if their phone service doesn’t work, is billed incorrectly, is disconnected during a billing dispute, or never installed at all. The PSC has traditionally served as a last resort for customers who do not get satisfaction dealing with the local phone company directly. PSC intervention is taken very seriously by most phone companies, but the state agency will be rendered almost toothless under this bill.

Second, although existing rural phone customers would be able to keep their basic landline service (for now) under this measure, nothing prevents AT&T from marketing alternative wireless phone service to customers experiencing problems with their existing service. Verizon has attempted that in portions of upstate New York, where telephone network deterioration has led to increased complaints. In some cases, Verizon has suggested customers switch to wireless service instead of waiting for phone line repairs which may or may not solve the problem. New rural customers face the possibility of only being offered wireless or alternative phone services.

Third, provisions in the bill give AT&T and other companies wide latitude to offer wireless or Voice over IP alternatives to landline service with little recourse for customers who only later discover these alternatives don’t support faxes, medical or security alarm monitoring, dial-up Internet, credit card processing, etc.

Fourth, the bill eliminates any requirement imposed upon broadband service in existence as of July 15, 2004. In fact, the measure specifically defines both phone and broadband service as “market-based and not subject to state administrative regulation.” That basically means service will be unregulated.

AT&T's wireless home phone replacement

AT&T’s wireless home phone replacement

Here are some real world examples of where S.B. 99 could trip up consumers:

  1. An elderly Louisville couple living the summer months in Louisville discover their phone service has been switched to the U-verse platform over the winter as AT&T seeks to decommission its deteriorating landline network in the neighborhood. S.B. 99 offers customers a 30-day opt out provision upon first notification, allowing a customer dissatisfied with the alternative service the right to switch back to their landline. But this couple was in Florida during the 30-day window, did not receive the notification to opt out in time to act, and are now stuck with U-verse. Unfortunately, the home medical monitoring equipment for his pacemaker does not work with Voice over IP phone service. This couple’s recourse: None.
  2. A customer moves into a new home currently served by AT&T’s wireless home phone replacement service. The customer doesn’t like the sound quality of the service and wants a traditional landline instead. Her recourse: None.
  3. A retired couple uninterested in broadband service or television from AT&T U-verse suddenly discovers AT&T wants to raise prices on landline phone service, but offers savings if the couple agrees to sign up for U-verse. Instead of paying a $25 monthly phone bill, the couple is now being asked, on a fixed income, to pay $100 a month for services they don’t want or need. Their recourse: They can appeal to keep their landline if they meet the aforementioned deadline, but they have no recourse if AT&T raises rates for basic phone service to make its discounted bundled service package seem more attractive.

Hood Harris, president of AT&T Kentucky, follows the same playback AT&T always uses when pushing these bills by framing its argument around landline telephone service regulation, which is an easy sell for cell phone-crazy customers who have not made a landline call in years:

Harris

Harris

Some of Kentucky’s laws that regulate our phones were written before cable television, cell phones, the Internet or email existed.

Because of these outdated laws, providers like AT&T must sink resources into outdated technology that could be invested in the modern broadband and wireless technology consumers want and need.

Every dollar invested in old technology is a dollar not being invested in speeding up the build out of new technology across the commonwealth.

It’s no longer the 19th century coming into your home over the old, voice-only phone network that was put in place under now-outdated laws. It’s the 21st century coming into your home over modern networks. While technology has changed dramatically for the better in just the past few years, our laws have not.

Despite what you may have heard, SB 99 will not remove landlines from rural homes or businesses.

Instead, this legislation puts those customers in charge of deciding which communications services they want and need. If you are a rural customer, for example, you may choose to join the nearly 40 percent of Kentuckians who already have moved on from landline home phones and gone only with a wireless phone, or you may choose a landline phone that’s provided over the Internet (known as Voice over Internet Protocol, or VoIP), or you may choose both a VoIP and a wireless service.

But you do not have to — you can keep your existing landline phone if you like. Under SB 99, the choice is yours.

It’s seems like a logical argument, until you read between the lines. Harris implies that those old-fashioned laws governing landlines you don’t have anymore are slowing down AT&T from bringing about a Broadband Renaissance for Kentucky. If AT&T only was freed from the responsibility of patching up its copper wire phone network, it could spend all of its time, money, and attention on improving cell phone service and bring broadband to everyone. Harris promises every resident will have a choice to get the service they want — wireless or wired — as long as you remember he is only talking about basic phone service, not broadband.

If your community isn't highlighted on this map, AT&T has a wireless-only future in store for you.

If your community isn’t highlighted on this map, AT&T has a wireless-only future in store for you.

Harris avoids disclosing AT&T’s true agenda. The company has freely admitted to shareholders it wants to scrap its rural wired network, now considered too costly to maintain for a diminishing number of customers. Unlike independent phone companies like Frontier, AT&T has been in no hurry to upgrade these rural customers for broadband service. AT&T has not even bothered to apply for federal broadband funding assistance to defray some of the costs of extending DSL to its rural customer base. With no possibility of buying broadband from AT&T, customers have little incentive to keep wired service if a cell phone will do. But decommissioning landline service in rural Kentucky guarantees these customers will probably never receive adequate broadband.

The "long term cost reduction" AT&T mentions above is for them, not for you.

The “long-term cost reduction” AT&T mentions above is for them, not for you.

AT&T claims it will invest the savings in a wireless broadband network for rural customers, but as any smartphone owner will attest, AT&T’s wireless service is much more expensive than traditional phone service and its data plans are stingy and very expensive. Customers who can buy DSL from AT&T pay as little as $14.99 a month for up to 150GB of usage. A wireless data plan with AT&T for a home computer or notebook starts at $50 a month and only provides 5GB of usage before customers face a $10 per gigabyte overlimit fee. Which would you prefer: paying $14.99 for 150GB of usage with AT&T DSL or $1,500 for the same amount of usage on AT&T’s wireless network?

AT&T’s claims it will expand broadband as a result of not having to spend money on its landline network are specious. In fact, regardless of whether Kentucky passes S.B. 99 or not, AT&T has already embarked on its last known U-verse expansion. Project Velocity IP (VIP) devotes $6 billion to expanding U-verse to 57 million homes, reaching 75% of customer locations by the end of 2015. For the remaining 25% of customers, mostly in rural areas, AT&T’s plan isn’t to spend more money on improved wired service. Instead, it will build out its wireless network to serve the remaining customers with its LTE wireless broadband service — the same one that costs you $1,500 a month if you use 150GB.

Wireless is a cash cow for AT&T, so even saddled with its landline network, the company still spends the bulk of its investments on the wireless side of the business. Project VIP could have devoted all its resources to bringing U-verse to a larger customer base, but it won’t. AT&T sees much fatter profits spending $14 billion now to expand its wireless 4G LTE network and collect a lot more money later from its rural Kentucky customers.

Kentucky residents who don’t have U-verse in their area by the end of 2015 are probably never going to get the service, with or without S.B. 99. So why support a measure that delivers all the benefits to AT&T and leaves you sorting through the fine print just to keep the service you have now at a reasonable price. In every other state where AT&T has won deregulation, it raises the rates with no corresponding improvement in service.

Just how bad can AT&T’s wireless home phone replacement be? Just look at their disclaimers:

AT&T Wireless Home Phone is not compatible with home security systems, fax machines, medical alert and monitoring services, credit card machines, IP/PBX Phone systems, or dial-up Internet service. AT&T’s fine print on its website.

“AT&T’s wireless services are not equivalent to wireline Internet.” Wireless Customer Agreement, Section 4.1.

“WE DO NOT GUARANTEE YOU UNINTERRUPTED SERVICE OR COVERAGE. WE CANNOT ASSURE YOU THAT IF YOU PLACE A 911 CALL YOU WILL BE FOUND.” (All caps in original). Section 4.1.

Currently there are 6 comments on this Article:

  1. Mary Alice Stratton says:

    When a cell tower fails, everything goes haywire. If you need proof, go back to the 9/11 records when the cell tower on top of the World Trade went down. It even affected landlines! My son lives in the affected area in Kentucky & we live in NH. On 9/11 our landlines were so messed up that he had a hard time contacting us!

    • Smith6612 says:

      A cell tower on top of the World Trade Center getting destroyed wouldn’t have caused issues except for the region which that cell station served. What is more probable, is due to mass hysteria the nation’s communications systems simply got overloaded from everyone placing calls finding out how their loved ones were doing. Also, it is notable that there was a pretty sizable Telephone exchange located next to the World Trade Center, owned by Verizon which took significant building damage from the towers collapsing.

  2. Dan says:

    Philip,

    I live in Shelbyville, KY. Small world, right? :)

    What can I do to get this off of Hornback’s agenda? I’m definitely one who will be in a bad situation should this pass. I am fortunate enough to get 3mb dsl from AT&T but it is my ONLY option, as the microwave wireless here is unreliable and I work from home.

    Thanks for any ideas you have,

    Dan

  3. James Cieloha says:

    Every AT&T customer should be ashamed of both Randall Stephenson and AT&T for their decision to abandoned it’s entire rural landline operations very severely.

    I feel that both Randall Stephenson and AT&T are trying to be way too big being like the Ku Klux Klan’s, the Bonnie and Clyde’s, the Wal-Mart’s, the Marlboro’s, the Joe Camel’s, the Paramount Pictures with the movie theater chain of the 1910-1940’s, the Morris Levy’s when he was part of Roulette Records, the Clive Davis’s when he was at Columbia Records in the 1970′s, the Neil Bogart’s of Casablanca Records fame of the 1970′s disco era with PolyGram having control of the record label, the Trinity Broadcasting Network’s, the Bernard Madoff’s, the Lehman Borthers, the Enron’s, the Worldcom’s, the Adelphia’s, the Tyco’s, the old incarnation of Hostess Brands, the Martha Stewart’s, the Jill Kelley’s, the Orie sister’s, the Teresa and Joe Giudice’s, the Robert Bobby and Maureen McDonnell’s, the Chris Christie’s, the Ray Nagin’s, the Jesse Jackson Jr’s, and the Franz-Peter Tebartz-van Elst of the 2000′s by letting greed get out of control so all of the head employees and bosses at AT&T to be able to enjoy carefree lavishly spending to support carefree lavishly salaries with carefree lavishly lifestyles with embezzlement using slush funds, scams, ponzi schemes, and other white collar crimes, luxurious homes, luxurious jets, luxurious cars, luxurious furs, luxurious jewelry, join luxurious clubs, go on to luxurious vacations, luxurious resorts and beaches, go to luxurious bars, go to luxurious hotels, go to luxurious casinos to do gambling, go to luxurious gold courses, go to horse races, throw luxurious parties, go to luxurious dinners, go to luxurious fundraisers, go to luxurious conventions, using slush funds to bribe, lobby, and scam at the FCC, House, Senate, and other government entries in Washington, DC to claim that they want to no longer have to deal with regulations regulating government rules at all and make dealing with communities too difficult for them to launch their own community based fiber optic cable line network serving their own community, using slush funds to bribe, lobby, and scam to the political candidates to help win their election and reelection campaigns, go to luxurious amusements parks including Disneyland and Walt Disney World, involved with drugs, spend it on various luxurious gifts, and have other luxurious items just to make them very happy then trying and willingness to improve the quality of all of their employees and making the customers very happy as well.

    I hope and I wish that AT&T goes out of business for their unwillingness to care for their customers and their employees. I feel that both Randall Stephenson and AT&T are trying to bribe like the General Tire/RKO General of the 1960′s and 1970′s by not being very honest of not only the customers and also on themselves with the force of demanding it’s customers to live without wireline phone service forever.

    I hope and I wish that the FCC shall allow all the telephone providers with internet broadband that has never ever impose usage caps to the internet broadband customers be allowed to purchase and acquired customers from AT&T and are being required to make a real big concession that they shall promised not to have any difficulties with all the internet broadband providers competitors and their customers by not imposing usage caps and meters and raising prices for them to put them out of business sooner and without any interference for 12 whole years straight.

    I feel that both Randall Stephenson and AT&T are way too big being way too busy trying to act like the Justin Bieber’s, the Miley Cyrus’s, the Baauer’s, the PSY’s, the Carly Rae Jepsen’s, the Tay Allyn’s, the Alison Gold’s, the Nicole Westbrook’s, the Rebecca Black’s, the Double Take’s, and the Guns N Roses Axl Rose as well as trying to be the Ku Klux Klan’s, the Bonnie and Clyde’s, the Conrad Murray’s, the Tonya Harding’s/Nancy Kerrigan’s, the Pete Rose’s and the Alex Rodriguez’s as the cheaters, the Jerry Sandusky’s as the assaulters, the Lee Harvey Oswald’s, the Jodi Arias’s, the Casey Anthony’s, the Charles Starkweather’s, the Charles Manson’s, the Lyle and Erik Menendez’s, the O. J. Simpson’s, the Scott Peterson’s, and the Drew Peterson’s as the greedy murderers, the Alfonzo Dennard’s, the Jeremy Dobbe’s, the Jeffery Ireland’s (the convicted drunk driver from Lincoln, Nebraska), the Otis Newcomb’s, the Amanda Bynes’s and the Lindsay Lohan’s as the drunk and the drug life people) the Ferris Bueller’s, the Gordon Gekko’s, the Victoria Grayson’s, the Victor Newman’s/the Jack Abbott’s, the J. R. Ewing’s/the Cliff Barnes’s, the Alexis Colby’s, the Charles Montgomery Burn’s/ the Mayor Quimby’s, the Homer and Bart Simpson’s, the Peter Griffin’s, the Garfield cat’s, the Cookie Monster’s, and the Miss Piggy’s (all fictional characters) of the television, telephone, and internet broadband industry of preferring to let customer service suffer to rake in more money for themselves.

    I feel both Randall Stephenson and AT&T are trying to turn into the Ku Klux Klan’s, the Bonnie and Clyde’s, the Paramount Pictures of the 1910’s-1940’s engaging in block booking practices, the General Tire/RKO General of the 1960′s and 1970′s engaging in bribery practices, the 1919 Chicago White Sox’s baseball team bribery scandal and the Southern Methodist University football team bribery scandal of the 1980′s to force all the customers to accept whether or not the customers will be willing to deal with AT&T’s customer service and making them deal with just getting wireless phone and internet service in the very rural areas by the use of extortion. I urge all the AT&T customers to boycott both Randall Stephenson and AT&T right now for making all the customers suffer from having to deal with poor service for both of their telephone and internet broadband needs and abandoning wireline landline service to the very rural areas in a big huge ugly game of baw baw baw baw baw baw baw baw baw baw baw baw chicken and Russian Roulette as an excuse for the bean counting and bloated telecom companies to gamble and self destruct themselves in the future of the telephone industry.

    Wireline phone and internet is useful for web users to look at for news and weather reports as well as for important emergencies. I feel that all of the fat cat politicians and the fat cat phone and internet providers want to see wireline service to go away and force all of the wireline customers to pay up a lot more money for the right to keep phone and internet service so all of the fat cat politicians and the fat phone and internet providers can have carefree lavish spending to fully support their endless greedy lavish lifestyles for their own political gain by way of block booking and extortion is so very shameful and so very disgraceful in my own personal opinion and theory. I feel that all of the fat cat phone and internet providers and the fat cat politicians have never learned from various scandals happening in the past. Have those fat cat phone and internet providers and fat cat politicians learned from the Paramount Pictures practice of block booking with theatrical theatres of the 1910-1940’s, No, the Vietnam War, No, the General Tire/RKO General broadcasting license scandal of the 1960’s and the 1970’s, No, the Watergate scandal with Richard Nixon’s involvement, No, the Southern Methodist University football bribery scandal of the 1980’s, No, the Pete Rose betting scandal in baseball of the late 1980’s, No, the Bernard Madoff ponzi schemes, No, the collapse and bankruptcy of Enron, Worldcom, Lehman Brothers, and the first incarnation of Hostess Brands, No. These are examples of what I feel that all of the fat cat phone and internet providers and the fat cat politicians are trying to do to attack wireline phone and internet service in the United States Of America in a few years into the future.

    I’m commented in response to all AT&T customers who are very sick of all the ways AT&T treats both their customers and their employees and to see all of them being force to suffer with AT&T and have fears to see AT&T service deteriorate very much rapidly in a heartbeat in the very rural areas.

    I gracefully would support all community internet broadband providers and would want all of them to be able to be allowed to provide the fastest internet speeds of up to 1GB very fairly by the communities being allowed to build their own fiber optics cable lines without interference from both Randall Stephenson and AT&T with the fact that AT&T is already providing very limited internet broadband service at way less broadband speeds to all of their own customers and of their decision to get rid of their wireline landline services in very rural areas.

    I hope and I wish that both Randall Stephenson and AT&T is willing to allow all the communites to build out their own fiber optic cable networks for their superior mega fast internet broadband service that beats out AT&T’s internet service and speeds to all of their own customers in very rural areas.

  4. The Kin says:

    I live in kentucky myself and go through NCTC for my internet. I live 8 miles out of a small town in south central Kentucky and have only had a 1.5 meg connection here for about the last 7 years. It started out as a 768k connection but they finally “upgraded” it to a 1.5 connection. Since then there have been no improvements. Our cooperative (NCTC) has been doing Fiber to the home in Tennessee but hasn’t done jack in kentucky for over 7 years. No speed increases. The inner city can do about 12-20 megs or so, but that’s it. Moving into the city isn’t an option simply because of cost. Us rural folk tend to get screwed pretty bad. While I understand that speeds are going to be slower…Come on. You can’t provide me with at least a 3-6 meg connection? Even with that I’d be happy.

    Hopefully this bill doesn’t pass. AT&T is a horrible company. I dealt with them on my laptop for wireless when I worked as a security guard. Never again.

  5. Don says:

    Kentucky residents need to wake up and make some real noise, fast. If you are reading this, it is up to YOU to help get the ball rolling. AT&T has crony elected officials in their pockets, and they spend a fortune to keep the public confused and misinformed. The ONLY way to counteract this is by grassroots efforts. Share links to this article on social media and your local media. Make phone calls and send letters. Contact YOUR elected officials. Be LOUD.

    The disastrous consequences you have read about here will become YOUR reality if you don’t.

    And if you happen to live in another state – you should still make noise! If you don’t, and Kentucky falls, soon your state will, too. It’s just a matter of time. But it doesn’t have to happen!

    Your apathy (such as assuming other people will make those phone calls and send those letters) will result in this becoming a horrible reality. Never assume “others” will pick up the slack in complaining (they rarely do).

    If you care at all about this, take the small amount of time required to make yourself heard – now – and loudly.







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