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AT&T, which announced in April that it would begin expanding its latest high-speed fiber networks to 100 U.S. cities, now says that recent government indecision over net neutrality has caused the company to suspend its fiber projects and spending until the net neutrality rules are decided.
The AT&T decision was announced in a Nov. 12 story by Reuters, based on a statement made by AT&T CEO Randall Stephenson following recent comments about net neutrality from President Barack Obama.
Obama had issued his comments about the Internet and its future last week, shortly after leaving on a trip to Asia, according to a recent eWEEK report. He said he wants to see the FCC adopt Title II as a way to include Internet service providers (ISPs) in existing neutrality regulations. Title II refers to the Communications Act, which gives the FCC the power to regulate communications in the United States. Title II was originally intended to make sure that telephone companies provided service to anyone in their coverage area.
At the same time, Tom Wheeler, the chairman of the FCC, said he differs from the president’s opinion, preferring what he called a “more nuanced solution” to the issue, according to a recent eWEEK report.
This wide range of opinions on the direction of net neutrality caused AT&T to take its own position and try to pressure all sides to make some final decisions on the matter, according to Reuters.
“We can’t go out and invest that kind of money deploying fiber to 100 cities not knowing under what rules those investments will be governed,” Stephenson said at an analyst conference, according to the report.
In April, AT&T announced that it would begin an initiative to expand its fiber network to 100 cities and municipalities nationwide, including 21 major metropolitan areas around Atlanta; Charlotte, N.C.; Chicago; Cleveland; Fort Worth, Texas; Fort Lauderdale, Fla.; Houston; Jacksonville, Fla.; Kansas City; Los Angeles; Miami; Orlando, Fla.; San Diego and San Francisco.
Earlier this year, AT&T had begun offering its high-speed U-verse with GigaPower services to customers around Austin, Texas—one of three areas in which Google now offers Google Fiber. AT&T also announced in April that it was in talks to do the same in the Triangle and Piedmont Triad regions of North Carolina.
With its fiber broadband network, the company said that network speeds of up to 1 gigabit per second are “within sight.”
Two IT analysts told eWEEK that they have varying opinions about AT&T’s announcement to pull back on its fiber spending for now.
Dan Maycock, an analyst with OneAccord Digital, said he can understand AT&T’s frustration due to congressional gridlock in Washington.
“It’s not the most productive time to try to unilaterally work on something as complicated as net neutrality,” said Maycock. “I think this is AT&T saying they’re not doing this in this environment and them trying to turn the heat up” on government officials.
AT&T Pulls Back on Fiber to 100 U.S. Cities Over Net Neutrality Fight
What AT&T is also doing, he said, is giving residents in those 100 cities where high-speed fiber network installations are being halted lots of reasons to call their legislators to demand action on net neutrality so that the high-speed capabilities can finally arrive in their communities.
“I think it’s smart of them to put the pressure on where people will respond with votes,” especially since 2016 is a big election year, said Maycock. “They can say, ‘Hey, if you live in this area, put pressure on your political leaders to get this moving.'”
It’s likely that other telecommunications and Internet companies will follow AT&T’s lead on this issue, he said.
Charles King, principal analyst with Pund-IT, said that while he understands AT&T’s public stance on the matter, it’s actual more “political theater” than real substance.
The reason for his skepticism, he said, is that by actually halting spending on fiber installations, AT&T could potentially put itself behind schedule on such work and give competitors a chance to gain big advantages in those communities.
“If this was serious, they’d basically be cutting their own throats from a competitive standpoint” because installing these systems take a long time, said King. “If they put a kibosh on this, they are going to be putting a delay on whatever comes down the road. What I think this really is, is a studied effort on their part to give their allies in Washington a stick [with which to] to beat up the president and other net neutrality supporters.”
In October, officials from AT&T, Comcast and Verizon told U.S. leaders that they do not plan to offer faster Internet access, or so-called “fast lanes,” to content producers who are willing to pay more to get their messages out in front of competitors’ transmissions, according to an earlier eWEEK story.
The issue of net neutrality has been a hotbed for several years, with proponents and opponents arguing their positions and bashing the opposition verbally in public forums and discussions.
In September, the FCC announced that it had received a record 3 million comments about proposed rules for net neutrality by a Sept. 15 deadline.
While Obama was running for the presidency in 2007, he pledged to support net neutrality if elected.