AT&T has deployed fiber-to-the-home internet to less than 30 percent of the households in its 21-state territory, according to a new report that says AT&T has targeted wealthy, non-rural areas in its fiber upgrades.
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The report, cowritten by an AT&T workers union and an advocacy group, is timely, being issued just a few days after AT&T confirmed it will stop connecting new customers to its aging DSL network. That does not mean customers in DSL areas will get fiber, because AT&T last year said it was mostly done expanding its fiber service. AT&T said at the time that it would expand fiber incrementally, but only in areas where it makes financial sense for AT&T to do so. We'll provide more detail on the DSL cutoff later in this article—in short, the fiber/copper hybrid known as AT&T Internet is still offered to new customers, but the slower product that AT&T sells under the DSL name is being discontinued except for existing customers.
Citing data that ISPs are required to submit to the Federal Communications Commission, the report issued this week said that AT&T had built fiber-to-the-home to 28 percent of the households in its footprint, as of June 30, 2019. The report was written by the Communications Workers of America (CWA), a union that represents AT&T employees, and the National Digital Inclusion Alliance (NDIA), an advocacy group that has been tracking AT&T's broadband deployments for years. The groups say that AT&T has left rural areas and people with low incomes with old, inadequate broadband services.
There are 52.97 million households in AT&T's home-internet service area, and 14.93 million of them have fiber-to-the-home access, the CWA told Ars. The fiber percentages were particularly bad in some states, with rates of 14 to 16 percent in Michigan, Illinois, Mississippi, and Arkansas, the CWA/NDIA report said.
"Across the predominantly rural counties in AT&T's national footprint, only 5 percent of households (217,284 out of 4,442,675) have access to fiber," the report said. In urban areas, the situation is better but not problem-free. "Seventy percent of households in urban counties still lack access to fiber from AT&T, because the company has made fiber available to only 14.7 million households out of 48.4 million total households in these counties," the report said.
AT&T Upgrades Leave Poor People Behind
NDIA's research in previous years has called attention to AT&T's "digital redlining" in cities such as Cleveland and Detroit, in which the richest inhabitants of cities are prioritized for fiber upgrades. The new report found much the same.
"AT&T prioritizes network upgrades to wealthier areas, leaving lower-income communities with outdated technologies—households with fiber available have median income 34 percent higher than those with DSL only," the report said.
AT&T can provide decent broadband speeds without building fiber all the way to each home, with a fiber-to-the-node approach that minimizes use of copper phone cables. But there are still many areas where AT&T does not offer service at the FCC's standard of 25 Mbps downstream and 3 Mbps upstream. The nearly 6-year-old 25/3 Mbps standard has been roundly criticized by consumer advocates, who say it is no longer fast enough to be considered modern broadband, but it would be a big step up for many people in AT&T territory.
"For 28 percent of the households in its network footprint, AT&T's internet service does not meet the FCC's 25/3 Mbps benchmark to be considered broadband," the CWA/NDIA report said.
Some customers in AT&T territory are lucky enough to have a cable operator that can provide modern speeds. But even for them, AT&T's failure to deploy fiber means they "are deprived of the benefits of competition in price, choice, and service quality," the report said. The lack of competition especially hurts people with low incomes, the report explained:
"Without competition for market share, providers have minimal incentive to expand the market by recruiting and supporting new broadband adopters—for example, by promoting low-income discount programs or investing in community digital inclusion partnerships. NDIA's affiliates are finding that their community members who qualify for the AT&T's low-income discount offering, Access from AT&T, often find that the data speeds available at their homes are too slow for the video-intensive applications they need for school, work, and telemedicine."
Cable giants Comcast and Charter have benefited from telcos like AT&T failing to upgrade tens of millions of homes to fiber services, giving the cable companies de facto monopolies in many parts of the US. AT&T has about 15.2 million internet subscribers, compared to 29.4 million for Comcast and 28.1 million for Charter.
In mid-2015, the FCC required AT&T to deploy fiber to 12.5 million customers in exchange for approving its purchase of DirecTV. As the CWA/NDIA report noted, "AT&T largely halted its national build-out of fiber to residential homes in mid-2019 after it met FCC-imposed conditions following the acquisition of DirecTV." AT&T has also received billions of dollars in FCC subsidies and has been accused of not deploying all the broadband it was obligated to provide.
AT&T provided the following statement:
"Our investment decisions are based on the capacity needs of our network and demand for our services. We do not 'redline' internet access, and any suggestion that we do is wrong. We have invested more in the United States over the past five years (2015–2019) than any other public company. We have spent more than $125 billion in our US wireless and wireline networks, including capital investments and acquisition of wireless spectrum and operations. Our 5G network provides high-speed internet access nationwide, our fiber network serves more 18 million customer locations, and we continue to invest to expand both networks.
No More DSL for New Customers
AT&T's wireline internet offerings fall roughly into three categories. Fiber-to-the-home is the fastest option for both download and upload speeds. The other two categories rely on old copper phone lines and are both technically DSL offerings, but they differ in how close the homes are to AT&T's fiber network.
AT&T calls the faster of these two copper-based services AT&T Internet and advertises download speeds of up to 100 Mbps. AT&T is still offering this service to new customers. The DSL service that AT&T has discontinued tops out at 6-Mbps downloads, according to USA Today article published Saturday.
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"AT&T reported 653,000 total DSL connections at the end of its second quarter, compared to 14.48 million on its fiber-optic and hybrid-fiber services," the article said. "The latter, sold as AT&T Internet, combines fiber trunk lines with DSL last-mile connections for faster speeds."
An AT&T statement said, "We're beginning to phase out outdated services like DSL and new orders for the service will no longer be supported after October 1. Current DSL customers will be able to continue their existing service or where possible upgrade to our 100 percent fiber network." AT&T's official DSL webpage has been updated to state that "AT&T no longer offers DSL service."
Of the 38 million households in AT&T territory that do not have fiber-to-the home, 22.6 million have access to VDSL (aka fiber-to-the-node), 13.9 million have the older DSL technology, and 1.5 million have fixed wireless, the CWA said.
"AT&T's poor maintenance of its DSL networks, with limited capacity for new connections, results in would-be new customers in some areas being denied service entirely or told they can only subscribe to fixed wireless service (a 4G wireless connection for home use, designed for rural areas)," the CWA/NDIA report said.
“The Slots Are Full”
The CWA/NDIA report details the plight of some people who live in AT&T's DSL territory. Jacob North, who lives in low-income housing in Oklahoma City, has AT&T DSL with a 150-GB-per-month data cap and paltry speeds. "A speed test conducted on September 14, 2020, clocked his service at 2.08 Mbps down and 0.24 Mbps up," the report said. That puts North's service right in line with AT&T's "2005 vintage DSL" speeds that range from 768 Kbps to 6 Mbps, the report said.
One of North's neighbors was unable to get AT&T DSL service even before the October 1 cutoff. An AT&T rep told the neighbor that "there are only limited slots; the slots are full," meaning that another neighbor would have to disconnect to open up a slot. This is consistent with our reporting from 2015 about how AT&T refused to serve potential customers because there weren't enough DSL "ports" to serve them.
With AT&T now preventing new DSL connections entirely, customers in areas without cable are in an even worse predicament than before.
Ars talked to North on Friday, and he said that both AT&T fiber and Cox cable are available nearby but haven't been extended to the public housing units. "We are in the middle of Oklahoma City," he said. "If you draw a map around us, everyone has some form of high-speed internet access." We confirmed that entering North's address into the AT&T and Cox broadband-ordering webpages results in messages stating that service is not available from either provider.
Data Cap Is Harsh, Especially on DSL
North is paying a base rate of $59 per month plus $10 for each additional 50 GB used beyond the 150-GB cap imposed by AT&T. The monthly bill for North and his family has ranged from $75 to $210 a month. North said he lives with his wife, their newborn child, and his wife's sister. Staying under the 150-GB data cap to save money is difficult given that so many people use Netflix as a cheaper alternative to traditional TV services, he told Ars.
Due to the pandemic, AT&T has waived data overage charges for fiber-to-the-home and AT&T Internet customers until December 31. But AT&T reimposed the data cap in DSL and fixed-wireless areas in July. AT&T has stuck with a 150-GB cap for DSL and 250-GB cap for fixed wireless despite providing a terabyte or unlimited data to AT&T Internet and fiber customers.
North is not alone among AT&T customers who are stuck on DSL despite living near fiber lines, the CWA/NDIA report said:
"Techs report that in some cases, AT&T is installing fiber 'backbone' that could serve many households but not installing the equipment necessary to connect it to homes. Of responding techs with knowledge of fiber deployment, 63 percent (546/869) report that in their work areas, AT&T is not installing splitting equipment even where a fiber backbone exists. As a result, consumers can not purchase next-generation fiber service, even if a fiber network exists nearby."
One AT&T technician reported not being able to get fiber internet at home "mainly because the company doesn't want to take on the cost of providing connectivity to areas where it isn't extremely easy or profitable."
Union to AT&T: Let’s Wire Up America
The CWA has regularly criticized AT&T for laying off workers who could expand the company's fiber network. But AT&T continued layoffs and reduced network spending this year, despite an earlier promise that AT&T would use a corporate tax cut to create "7,000 jobs of people putting fiber in [the] ground."
In today's report, the CWA and NDIA said that "AT&T should commit to capital investment in fiber deployment that would double the number of households passed by fiber in two years. If AT&T invests one quarter of its annual free cash flow (projected to be more than $25 billion) into rapid fiber deployment, it could deploy to more than 6 million locations per year." That figure assumes a cost of $1,000 per household, which it said "should be realistic as an average cost, given the widespread fiber backbone already deployed."
The CWA separately plans to release another report today on AT&T's use of contractors, alleging that work by contractors is beset by quality problems that increase costs, service quality problems for customers, and safety risks for workers and the public. The broadband report cowritten with NDIA argues that "AT&T must stop laying off its skilled, unionized workers and stop outsourcing work to subcontractors in order to pay lower wages" and that "an experienced workforce is a prerequisite to reliable, high-quality internet service, particularly in areas where AT&T's network is outdated or deteriorated."
This story originally appeared on Ars Technica.