AT&T's $14B Spending Announcement 'Another Telco Flim-Flam'

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Is AT&T's Nov. 7 statement that it's spending $14 billion on its wireless and wireline networks a hoax and a bribe?

That's the contention of Bruce Kushnick, a long-time telecom industry observer and executive director of the New Networks Institute, a research firm that investigates LECs' impact on consumers.

In a Nov. 20 blog for the Huffington Post, Kushnick said AT&T's announcement " is a collection of great sound-bytes designed to be picked up by pundits, media companies and used by politicians who believe in blue skies, sunny days and the tooth fairy."

For one thing, he said, AT&T already planned to spend that $14 billion, but phrased the news announcement to sound as though the money was in addition to planned outlays. Looking back on 2010 and 2011 construction spending, Kushnick said the $14 billion amounts to $5 billion extra over three years, or an 8 percent increase over what the company was spending.

"AT&T is just playing with the numbers," Kushnick said.

He also noted that AT&T, on the same day it released its $14 billion news, filed a petition with the FCC to close down the PSTN. Besides not having to maintain copper networks, AT&T no longer would have to operate under legacy telecom regulations, instead running under less restrictive "information service" oversight, Kushnick said. He further said that AT&T has made no actual commitments about the $14 billion projects, and that the carrier "is lying about the amount of money [it] will spend or the deployments [it] will accomplish."

"This is just another telco flim-flam," Kushnick wrote, going on to point out multiple instances of alleged bait-and-switch tactics on AT&T's part over the years.

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