AT&T has a sneaky plan.
It wants to exploit a loophole in the Federal Communications Commission (FCC)’s rules to kill what remains of the public telecommunications network — and all of the consumer protections that go with it. It’s the final step in AT&T’s decade-long effort to end all telecommunications regulation, and the simplicity of the plan highlights a dysfunction unique to the American regulatory system.
AT&T and other big telecom carriers want to replace the portions of their networks that still use circuit-switching technology with equipment that uses Internet Protocol (IP) to route voice and data traffic. But because the FCC previously decided that it has no direct authority over communications networks that use IP, this otherwise routine technological upgrade could lead to a state of total deregulation.
The immediate consumer impact of AT&T’s proposal would be swift and severe:
Higher prices. Remember what happened after California partially deregulated AT&T in 2006? The price of some basic voice services tripled. AT&T wants to make this happen everywhere. Also, the ability of many smaller wireless carriers to offer competitively priced services is based on specific regulations that prevent special access providers like AT&T and Verizon from charging exorbitant rates. These protections against monopoly prices will disappear if AT&T gets its way.
Inequality and discrimination. Seniors, low-income families, and rural residents — all of whom are more likely to rely on fixed-line voice services or dial-up internet access — would especially feel the pinch. Carriers that are now required to offer universal service will be free to redline poor neighborhoods and disconnect consumers at will. Elderly grandmothers living on fixed incomes rely on rate-regulated landlines to stay connected, but they need not worry: AT&T has an expensive wireless plan they can purchase instead.