Behind the scenes at both the Republican and Democratic National Conventions, AT&T is throwing secretive parties, handing out “schwag bags,” and engaging in a legal form of influence peddling to buy themselves goodwill with the eventual election winners.

The Republican National Convention held a week ago in Tampa, Fla. featured lavish, invitation-only parties for politicians attending the convention, sponsored quietly by AT&T.

AT&T went over the top at the Republican event, handing out goodie bags with stuffed elephants emblazoned with the company’s logo, convention pins, and other handouts designed to keep their name front and center with GOP movers and shakers. Tampa Bay Online found the phone company rented out one upscale, popular Tampa restaurant for the entire week, throwing expensive private parties for various state delegations.

The restaurant: Jackson’s Bistro, which locked the doors and turned its back on local regulars for the benefit of GOP high-rollers.

The sponsor: After digging, it turns out the money to rent the upscale eatery came from AT&T, but you wouldn’t know it from the restaurant owner and staff, which have been told to keep their mouths shut about who was paying for supper.

The sneaky: AT&T discovered it could easily navigate around loophole-ridden campaign finance laws which limit corporate-sponsored dinners, but have nothing much to say about “cocktail events.” So as long as diners are standing up while they munch, shake hands, and chat, it’s a-okay.

The mission: To get face time and establish goodwill with political movers and shakers. Feed them, toss them some AT&T flair, and let them know you will be calling on them soon. But no need to overdo it: AT&T can do more talking later… after the politicians get elected and the time is right to get the company’s agenda into the law books.

Keenan Steiner from the non-profit Sunlight Foundation says “this is where the seeds are planted for laws to be written in Washington and in state capitols all over the country.” He notes how important it is for both political parties to have the overwhelming corporate presence that most Americans never understand exists at both conventions:

The significance is, they wouldn’t be here, able to have a good time the whole time, without these corporations. It’s a sort of starting process to become dependent on these corporations. And in Washington, lawmakers require the about 100 lobbyists, over 20 lobbying firms that AT&T hires—they require the work of these folks to get their work done. They’re a sort of legislative subsidy. And they also require these corporations to get re-elected. They want to stay in office, and you better be friends with the Chamber of Commerce, with the NRA, with the big nonprofit groups, the shadowy nonprofit groups, that you really better be friends with them, because, if not, they could drop a lot of money in your district, and they could make you lose an election.

The Sunlight Foundation reports AT&T has been tilting toward the GOP: The contributions from AT&T’s PAC, employees and their family members to federal candidates total about $3 million for the 2012 cycle, with about two-thirds of the money going to Republican federal officeholders and candidates. Sunlight’s Political Party Time website helps break down where AT&T spends even more money wining and dining legislators.

The Michigan Republican delegation threw its kickoff party there Saturday night, which featured top state lawmakers. Guests at the event went home with a stuffed elephant with an AT&T logo, the Detroit News reported. AT&T also sponsored an Illinois delegation event there on Tuesday afternoon. The Chicago Sun-Times reported that the telecom giant is sponsoring the event, and events lists showed that the Illinois delegates was at Jackson’s that afternoon.

At this week’s Democratic National Convention at the Time Warner Cable Arena in Charlotte, N.C., AT&T’s Death Star logo isn’t hard to spot either.

Amidst the goodie bags and handouts from Indian tribes trying to secure lucrative casino laws, big pharmaceutical companies asking for special favors, and giant energy companies was once again: AT&T.

On Tuesday, Rep. Debbie Wasserman Schultz (D-Fla.), Democratic national chairwoman, lectured the Republicans about the influence of special interest cash at the Republican National Convention. She referred to the GOP affair as “last week’s special-interest funded, corporate-infused, backroom-deals, smoke-filled room, invitation-only affair that was held in my home state.”

Only the breakfast event where she made the remarks was bought and paid for by AT&T.

AT&T does not splurge on upscale dining for Democrats though. The party that largely opposed AT&T’s merger deal with T-Mobile and often supports Net Neutrality is making due with a far-smaller AT&T hospitality suite serving scrambled eggs and bagels at the inelegant Airport DoubleTree Inn, quite a step down from the Caramelized Diver Scallops and Red Snapper on the menu for the corporate-friendly GOP.

AT&T’s pervasive presence at the Charlotte convention is also upsetting union workers, who turned out in large numbers at the convention. Unionized employees are still fighting with AT&T for a new contract. Already uncomfortable in a state where union workers are virtually an endangered species (to add insult, unions were booked in non-unionized hotels), many were unprepared to feast at AT&T’s breakfast buffet.

“This is one breakfast I won’t be eating,” William Henderson, the president of Local 1298 of the Communications Workers of America told the CT Mirror. “I won’t eat their stuff.”

Only he didn’t say “stuff.”

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/William Henderson Boycotts ATT Breakfast.flv[/flv]

William Henderson, president of a Connecticut chapter of the Communications Workers of America, stands outside leafleting an AT&T-sponsored breakfast in Charlotte, N.C., displaying a bumper sticker: “AT&T=Greed.”  (1 minute)

What should a good union worker with a gripe against AT&T do instead?  Leaflet the event, to the great potential embarrassment of AT&T officials and Connecticut Democratic lawmakers holding a union grievance brochure in one hand and an AT&T coffee cup in the other.

The room eventually quieted down to listen to former Connecticut Sen. Chris Dodd make remarks… on behalf of the Motion Picture Association of America, who he now represents.

Despite the Snapper-Gap between the two political parties, you cannot miss AT&T in Charlotte. Although convention spokespeople officially refer to corporate sponsors as “providers,” AT&T’s corporate logo is “provided” on every last lanyard handed to delegates and journalists, right next to Barack Obama’s campaign logo.

In case you forgot to charge your cell phone, two AT&T officials are permanently on hand at a table near the entrance to the event offering free battery boosters. But don’t worry, they’ll get paid back for that goodwill later.

[flv width=”448″ height=”276″]http://www.phillipdampier.com/video/Party Time RNC Cash.flv[/flv]

Democracy Now talks with Sunlight Foundation’s Keenan Steiner who shares the secrets of corporate cash at the Republican National Convention in Tampa.  (18 minutes)

Phone companies depending on DSL to keep them in the broadband business are in growing trouble, unless they lack a nearby cable competitor. Subscriber numbers from nine different major phone and cable companies over the summer of 2012 show cable broadband continues to grow as customers cancel DSL service from their local phone company. But for rural customers, DSL often remains the only option. That leaves rural providers like Frontier, Windstream, and CenturyLink in better standing than larger companies like AT&T and Verizon.

Phone Companies

• AT&T‘s U-verse service is the only thing keeping AT&T broadband numbers on the rise. AT&T added 553,000 new U-verse customers during the summer and now serves 6.5 million customers on its fiber-to-the-neighborhood network. AT&T continues to lose DSL customers, primarily to local cable competitors.
• CenturyLink, Inc. has been upgrading its DSL service in several areas to better compete with cable broadband, and is also deploying a fiber-to-the-neighborhood service in select cities. The network upgrades are helping, bringing the company 18,000 new broadband customers. CenturyLink currently serves 5.76 million Internet customers nationwide.
• Frontier Communications has lost broadband customers in its larger service areas, mostly to cable, but those losses have been offset by its DSL expansion in rural areas that have never had broadband before. But the company only managed to add just under 6,000 new broadband customers during the last quarter, serving 1.78 million customers across the country.
• Verizon Communications: Verizon was willing to turn away potential DSL customers for the first time, as it discontinued selling DSL to those who don’t want Verizon landline service. That, and pervasive cable competition, meant Verizon only picked up 2,000 new DSL customers this quarter — the worst showing in four years. Verizon FiOS’ recent price hikes also cost the company some growth for its fiber to the home service,  but still earning a respectable 134,000 new customers (5.1 million total). Time Warner Cable, Cablevision, and Comcast have all managed to win back FiOS customers with attractive discount offers.
• Windstream Corp. faces cable competition in a number of its semi-rural service areas, and its DSL service has not been able to keep up with the growing speeds available to cable broadband subscribers. For the first time, Windstream reported it lost more customers than it added, losing 2,200 DSL subscribers. Windstream still has 1.36 million customers signed up for its broadband service.

Cable Companies

• Cablevision, which serves mostly suburban New York City, New Jersey, and Connecticut added 25,000 new high speed customers, many coming back to the cable company from Verizon. Cablevision serves a relatively small geographic area, but a densely populated one. Nearly 3 million broadband customers have remained loyal to the cable company.
• Charter Cable picked up 37,000 new broadband customers, a number fleeing phone company DSL for Charter’s higher speed broadband services. Charter serves 3.8 million broadband customers.
• Comcast added 156,000 new customers to its roster of 18.7 million Internet customers, again mostly from former DSL customers.
• Time Warner Cable expanded with 59,000 new high speed customers, primarily from DSL disconnects. Time Warner provides service for 10.8 million broadband customers.

The Republican platform on telecommunications and its criticism of the Obama Administration’s handling of broadband inspired a blogger at the Washington Post to ponder the question, “Whatever happened to Obama’s goal of universal broadband access?”

Brad Plumer sees the Republican criticism as valid, at least on the surface:

Does anyone remember when the Obama administration promised to bring “true broadband [to] every community in America”? The Republican Party definitely does, and its 2012 platform criticizes the president for not making any progress on this pledge:

“The current Administration has been frozen in the past…. It inherited from the previous Republican Administration 95 percent coverage of the nation with broadband. It will leave office with no progress toward the goal of universal coverage—after spending $7.2 billion more. That hurts rural America, where farmers, ranchers, and small business manufacturers need connectivity to expand their customer base and operate in real time with the world’s producers.

So whatever happened to the Obama administration’s plan to expand broadband access, anyway? In one sense, the Republican critics are right. Universal broadband is still far from a reality. According to the Federal Communications Commission’s annual broadband report, released in August, there are still 19 million Americans who lack access to wired broadband. Only about 94 percent of households have broadband access. Obama hasn’t achieved his goal.

Stop the Cap! has been watching the rural broadband debate since the summer of 2008, and believes the failure to do better isn’t primarily the fault of Republicans or Democrats — it lies with the nation’s phone companies — particularly AT&T and Verizon. But both political parties, to different degrees, have helped and hindered along the way.

Plumer slightly misstates the commitment of the Obama Administration at the outset. The Obama-Biden Plan never promised to successfully complete universal broadband access in the United States. Here is their actual pledge (emphasis ours):

Deploy Next-Generation Broadband: Work towards true broadband in every community in America through a combination of reform of the Universal Service Fund, better use of the nation’s wireless spectrum, promotion of next-generation facilities, technologies and applications, and new tax and loan incentives. America should lead the world in broadband penetration and Internet access.

Big Phone Companies Struggle to Abandon Landlines in Rural America

By far, AT&T and Verizon Communications are the most culpable for leaving rural Americans without broadband service. Over the last four years, both companies have diverted investment away from their landline networks into wireless. AT&T has also spent millions lobbying state governments to free itself from the requirement of serving as “the carrier of last resort,” a critical matter for rural landline customers, particularly because rural wireless coverage remains lacking.

In most states, the dominant phone company is still mandated to provide basic telephone service to every customer who wants it. Universal electric and telephone service goes all the way back to the Roosevelt Administration, who saw both as essential to the rural economy.

The Communications Act of 1934 that the Republicans today dismiss as outdated established the concept of universal telephone service: “making available, so far as possible, to all the people of the United States a rapid, efficient, nationwide and worldwide wire and radio communication service with adequate facilities at reasonable charges.”

The concept of universal service was reaffirmed, with the blessing of the telephone companies, under the sweeping deregulation of the landmark Telecommunications Act of 1996. Republicans call that law outdated as well.

Rural America Can’t Win Better Broadband If Their Providers Don’t Play

The American Recovery and Reinvestment Act provided the Department of Commerce’s National Telecommunications and Information Administration (NTIA) and the U.S. Department of Agriculture’s Rural Utilities Service (RUS) with $7.2 billion to expand access to broadband services in the United States. Of those funds, the Act provided $4.7 billion to NTIA to support the deployment of broadband infrastructure, enhance and expand public computer centers, encourage sustainable adoption of broadband service, and develop and maintain a nationwide public map of broadband service capability and availability.

This first round of serious broadband stimulus was designed to help defray the costs of bringing broadband to rural areas where “return on investment” formulas used by large phone companies deemed them insufficiently profitable to service.

Remarkably, America’s largest phone companies declined to participate. In March 2009, AT&T and Verizon delivered their response to the Obama Administration through Bloomberg News:

Verizon Communications Inc. and AT&T Inc. may have this response to the U.S. government’s offer of $7.2 billion for high-speed Internet projects: Keep it.

Unlike the businesses that welcomed the $787 billion stimulus package approved by Congress last month, the two biggest U.S. phone companies have reservations. They’re urging the government not to help other companies compete with them through broadband grants or to set new conditions on how Internet access should be provided.

The companies have remained noncommittal as they lobby to shape rules for the grants.

“We do not have our hand out seeking government funds,” James Cicconi, AT&T’s senior executive vice president, told reporters March 11. While the company is “open to considering things that might help the economy and might help our customers at the same time,” he said AT&T’s primary focus for broadband is its own investment program.

AT&T’s own financial reports illustrate its “investment program” was largely focused on its wireless services division, not rural broadband. Many other phone companies filed objections to projects they deemed invasive to their service areas, whether they actually provided broadband in those places or not.

When the final NTIA grant recipients were announced, the overwhelming majority were middle-mile or institutional broadband networks that would not provide broadband to any home or business.

The U.S. Department of Agriculture’s Rural Utilities Service managed the rest of the broadband grants and loans, and the majority went to exceptionally rural telephone companies, co-ops, and tribal telecommunications. AT&T did participate in one aspect of broadband stimulus — its legal team and lobbyists appealed to grant administrators to change the rules to be more flexible about how and where grant money was spent.

In the past year, both AT&T and Verizon have signaled their true intentions for rural landline service:

Verizon CEO Lowell McAdam: “In […] areas that are more rural and more sparsely populated, we have got [a wireless 4G] LTE built that will handle all of those services and so we are going to cut the copper off there,” McAdam said. “We are going to do it over wireless. So I am going to be really shrinking the amount of copper we have out there and then I can focus the investment on that to improve the performance of it.”

AT&T CEO Randall Stephenson: “We have been apprehensive on moving, doing anything on rural access lines because the issue here is, do you have a broadband product for rural America?,” Stephenson told investors earlier this year. “And we’ve all been trying to find a broadband solution that was economically viable to get out to rural America and we’re not finding one to be quite candid.”

More recently, Verizon has nearly disinherited its DSL service, making it more difficult to purchase (impossible in FiOS fiber to the home service areas). In states like West Virginia, it effectively slashed expansion and infrastructure investment as it prepared to exit the state, selling its network to Frontier Communications. AT&T has shown almost no interest expanding the coverage of its DSL service either. If you don’t have access to it today, you likely won’t tomorrow.

A good portion of the broadband stimulus funding provided by the government is actually in the form of low-interest, repayable loans. Despite rhetoric in the Republican platform about supporting public-private partnerships to expand rural broadband, the Republicans in Congress launched coordinated attacks on the Broadband Access Loan Program offered by the USDA’s Rural Utilities Service in the spring of 2011. Various right-wing pundits and pressure groups joined forces with several Republican members of Congress attempting to permanently de-fund the program, starting with $700 million in federally-backed loans in April, 2011. The loans were targeted to public and private rural telecommunications companies attempting to expand or introduce broadband service.

Attacks on the effectiveness of President Obama’s broadband campaign pledges in the Republican platform ring a little hollow when Republican lawmakers actively blocked the administration’s efforts to keep those promises.

Killing Community Broadband: Priority #1 for Providers With the Help of Corporate-Backed ALEC and State Politicians

Stop the Cap! has repeatedly reported on the challenges of community broadband in the United States. Launched by towns and villages to provide quality broadband service in areas where larger companies have either underserved or delivered no service at all, publicly-owned broadband is often the only chance a community has to stay competitive in the digital age.

That goal is shared by the GOP’s platform, which states how important it is to connect “rural areas so that every American can fully participate in the global economy.”

Unfortunately, unless your local phone or cable company is providing the service, all too often they would prefer communities continue to receive no service at all.

AT&T is among the most aggressive phone companies lobbying state officials, often through the American Legislative Exchange Council (ALEC), to pass state laws hindering or banning community broadband development. ALEC supporters, overwhelmingly Republican, accept company-drafted legislation as their own and introduce it in state legislatures, hoping it will become law. Generous campaign contributions often follow.

In the past few years, AT&T and Time Warner Cable have been especially active in broadband backwater states like North and South Carolina and Georgia, where rural counties often receive nothing more than DSL service at speeds that no longer qualify as “broadband” under the Obama Administration’s National Broadband Plan. In North Carolina, Democratic state politicians well funded by Time Warner Cable helped push bills forward, but it took a Republican takeover of the North Carolina legislature to finally get those laws enacted. South Carolina presented fewer challenges for state lawmakers, despite protests from communities across the state bypassed by AT&T and other phone companies.

The efforts to de-fund broadband stimulus and tie the hands of communities seeking their own broadband solutions have done considerable damage to the rural broadband expansion effort.

Universal Service Fund Reform: Not Much Help If America’s Largest Phone Companies Remain Uninterested

The Obama Administration has also kept its pledge to reform the Universal Service Fund, recreating it as the Connect America Fund (CAF) to help wire rural America.

In its first phase of broadband funding, $300 million dollars became available to help subsidize the cost of rural broadband construction. Deemed a “mild stimulus” effort that would test the CAF’s grant mechanisms, only $115 million of the available funding was accepted by the nation’s phone companies — all independent providers like Frontier, FairPoint, CenturyLink, Windstream, and smaller players. Once again, both AT&T and Verizon refused to participate. There is no word yet on whether the two largest phone companies in the country will also effectively boycott the second round of funding, estimated to allocate over $1.8 billion to expand rural broadband.

“Getting to 100 percent is going to be a very difficult long-term goal, given the size of the U.S. landmass and the huge expense to reach those final couple of percentage points,” John Horrigan of the Joint Center Media and Technology Institute told Brad Plumer.

Politics and provider intransigence seem to be getting in the way just as much as America’s vast expanse. Many conservative and provider-backed groups have called America’s claimed 94% broadband availability rate a success story, and don’t see a need to fuss over the remaining six percent that cannot buy the service (and pointing to a larger number that don’t want the service at today’s prices).

Beyond the partisan obstructionism and middle mile/institutional network “successes” that ordinary consumers cannot access, the real issue remains the providers themselves. You can lead a horse to water but you cannot make him drink.

It seems as long as AT&T and Verizon treat their rural landline customers as hayseed relatives they (and Wall Street) could do without, the rural broadband picture for customers of AT&T and Verizon will remain bleak at current stimulus levels regardless of which party promises what in their respective platforms.

An Antioch, Calif. woman on Social Security disability faced a substantial bill from AT&T for equipment lost in a recent house fire that left her with nothing but the clothes on her back, until the local media helped the company change its mind.

Her TV melted into a plastic mess, along with the box for AT&T. Now AT&T wants payment for the equipment. I have written them to inform them that everything, including the AT&T equipment, was destroyed in the fire. The company still wants to be paid for the destroyed parts. The landlord’s insurance did not cover tenant’s loss.

I want to let your readers know that if they lose their AT&T equipment due to a disaster beyond their control, they will have to pay for the equipment.

But once the San Jose Mercury News reached out to AT&T, they changed their mind.

AT&T spokesman John Britton:

“We are sorry to learn about the fire. We are glad our customer was able to get out of the burning house safely. We have adjusted the charges. Our policy is to be sensitive, listen to customers and to evaluate these claims on a case-by-case basis.”

Most cable and phone companies maintain policies that require customers to compensate them for equipment either lost or damaged in natural disasters or fires. Problems arise most frequently when renters discover that whatever insurance a property owner maintains only covers damage or loss to the building itself. Renters need renter’s insurance to cover theft or damage to their property. The coverage is often overlooked, despite the fact it is very inexpensive.

Damaged cable television set top boxes can cost $300-500 or more each, no matter how old. Companies also routinely charge full price for damaged remote controls, cable modems, and company-supplied wireless routers.

Media attention regarding losses that were not the fault of customers often gets companies to waive fees, and some will issue blanket waivers where neighborhoods are affected by fire, flood, or tornadoes, but not always.

Insurance companies will usually handle matters directly with the cable, satellite, or phone company once the damaged equipment becomes part of an insurance claim. Some insurance policies will not cover the full replacement cost of equipment, but in such cases providers typically agree to accept the depreciated value to settle the matter.

Does your local newspaper sell its journalistic credibility down the river with an annual “best of” contest asking readers to vote for their favorite companies the newspaper later uses to shamelessly pursue advertising deals for a “special supplement” announcing the results?

The Topeka Capital-Journal sure does, and they’ve transformed the seedy affair into an art form, complete with softball interviews for some of the winning companies.

Take AT&T, which somehow got voted Topeka’s best cell phone company. (Verizon, Sprint, T-Mobile, and TracFone also made their “list” — showing either the tiny number of cell phone competitors in Topeka or a desire not to leave anyone out.)

In a “special” to the Capital-Journal, ad sales guy “reporter” Phil Wilke managed to interview an AT&T spokesman… by e-mail. It was not a tough interview:

Pulitzer Prize material it is not.

Consumer Reports readers do not think as highly of AT&T, but then that magazine does not accept advertising from AT&T — Topeka’s newspaper does. (J.D. Power and Associates also put AT&T at the bottom in its own survey.)

I first got suspicious when Olive Garden, the Chef Boyardee of Italian restaurants, made the list for “best restaurant service,” “best Italian restaurant,” and [shudder] “most romantic restaurant.” There is either something very wrong in Topeka, or these results don’t mean a thing.

But they do mean a lot of advertising revenue for the Capital Journal, which can call every winner and implore them to take out a special ad “thanking readers” for placing trust in their establishment. Puff pieces like the AT&T interview found above do little  for the newspaper’s credibility and trust with readers, however.

Surprisingly there was no category for Topeka’s best news source, but we did finally locate one where a nomination for the Topeka newspaper was appropriate: “BEST PLACE TO PLAY SOFTBALL.”