AT&T Fears Net Neutrality will Stall Network Upgrades

by Matt Klassen on November 13, 2014

In what is quickly becoming the biggest story of the week, AT&T CEO Randall Stephenson chimed in on President Obama’s recent call for tough Net Neutrality regulations aimed at protecting consumers against unfair and arbitrary network management, saying that such rules will curtail broadband network advancement both in the short and long terms, with his company, at least, threatening to halt their next gen fiber line upgrade because of the uncertainty wrought by Net Neutrality.

“It’s prudent to pause,” he said at an investor conference Wednesday. “We want to make sure we have line of sight on this process and where these rules could land, and then re-evaluate.” Of course this follows several days of broadband companies and lobbyist-swayed Republicans crying warning the proposed regulations will be onerous and might actually stunt investment and curtail innovation.

But is there anyone else who sees the response of the broadband industry as nothing more than whiney children threatening to take away their toys because they don’t like how the game is being played? Will regulations regarding fair treatment of all Internet traffic really crush AT&T’s plans for investing in next gen fiber networks? I simply can’t see how.

AT&T is currently investing heavily in its GigaPower 1-gigabit broadband service—the next generation on broadband network upgrades—with plans of delivering this service to 100 cities by the end of next year. It is this plan, Stephenson warns, that may be stalled by the uncertainty created by Net Neutrality.

“We can’t go out and invest that kind of network without knowing the rules governing the network,” Stephenson said.

Now on the one hand Stephenson is right, there may be an uncomfortable transition period, particularly if Obama’s wish to put broadband under Title II as a “common carrier,” one that may actually last a year or two. It is during that time, Stephenson warns, that innovation may be hampered, as companies like AT&T will be focusing their efforts on understanding and implementing the new rules.

But on the other hand, the way broadband providers and Republicans are talking, it’s like Net Neutrality will kill the Internet, not allowing broadband carriers to make money, thus not allowing to invest in research and development, thus not allowing them to advance broadband technology, which all results in them going out of business, the Internet crumbling, and destroying the very fabric of society.

In fact, the way Stephenson spoke earlier this week you’d think that investing in broadband services will be impossible should President Obama’s vision for Net Neutrality be enacted, as if suddenly the inability to bilk customers and throttle networks will make running a broadband operation completely unfeasible.

As I’ve said before the problem for carriers with Obama’s vision of Net Neutrality is not that they won’t be able to make money after such rules are enacted, but that they may not be able to make money the way they want to (through tiered services, restricted Internet service, throttling and other dubious network management practices). In fact, consumers won’t stop paying for the Internet, they’ll be happy to actually, particularly if companies like AT&T not only upgrade broadband speeds, but actually provide the consistent service customers are paying for.

But maybe the entire point is moot, as the FCC is rumoured to be exploring a hybrid “middle ground” approach, leading me to believe that perhaps Obama’s entire vision is a cleverly construed plan to get the industry to react to his unacceptable proposal, subsequently agreeing to the FCC’s neutered middle ground. While I certainly hope not, truly nothing would surprise me in this ongoing Net Neutrality drama.

Did you like this post ? TheTelecomBlog.com publishes daily news, editorial, thoughts, and controversial opinion – you can subscribe by: RSS (click here), or email (click here).

Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

Previous post:

Next post: