AT&T will slash $3 billion off its capital investments next year
AT&T is planning to spend just $20 billion on capital investment in 2020, down from $23 billion this year. [...] The company is on pace to exceed its 2019 goal as it averaged more than $6 billion per quarter in the first three quarters. But with a forecast of $20 billion across all of 2020, AT&T expects to spend about $5 billion per quarter on capital investments going forward. The company is under pressure from investors to control spending, in part because its TV business is tanking and because of AT&T's giant debt load stemming from the purchases of DirecTV and Time Warner.
[...] AT&T's capital spending will decline next year despite the company's plan to roll 5G mobile service out nationwide. AT&T already got much of the 5G spending out of the way by purchasing spectrum licenses, and AT&T CEO Randall Stephenson told investors that the company's "strong spectrum position will allow for lower capital intensity" over the next three years.
AT&T has also mostly stopped its fiber-to-the-home broadband construction even though large portions of its 21-state territory still have only copper-based DSL service. Fiber deployment isn't stopping completely, as Stephenson said that "5G requires us to continue deploying fiber." But AT&T customers who can't get modern broadband speeds or reliable wireline service in their homes would welcome more capital investment in their neighborhoods.
Related: AT&T Lays Off Thousands After Nabbing Billions In Tax Breaks And Regulatory Favors
AT&T Will Give Poor People 1.5 Mbps DSL for $10 if US Allows DirecTV Merger
AT&T Employees Took Bribes to Plant Malware on the Company's Network
AT&T Turns On 5G In New York, But It Still Isn't Available To Consumers
Lawsuit: AT&T Signed Customers Up for DirecTV Now Without Their Knowledge
AT&T Considers Getting Rid of DirecTV as TV Business Tanks, WSJ Reports
Related Stories
AT&T is promising to offer cheaper Internet service to poor people if it's allowed to buy DirecTV. This is similar to a promise that helped Comcast gain government approval of its 2011 acquisition of NBCUniversal.
Qualifying residents in areas where AT&T's top speeds are below 5 Mbps (that's not a typo) will be offered DSL service of "up to 1.5 Mbps, where available" for $10 a month, AT&T said in a filing with the Federal Communications Commission last week. It'll be $5 a month for the first year before rising to $10 for the next three years. AT&T is proposing a four-year commitment in total.
In areas where AT&T's top speeds are higher, the company said it "will offer a broadband wireline DSL service at speeds up to 5 Mbps to households in AT&T's wireline footprint for $10 per month for the first 12 months of service (rising to $20 per month for the remainder of the term of the commitment)."
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AT&T Lays Off Thousands After Nabbing Billions In Tax Breaks And Regulatory Favors
Back in November of 2017 AT&T promised that if it received a tax break from the Trump administration, it would invest an additional $1 billion back into its network and employees. At the time, CEO Randall Stephenson proclaimed that "every billion dollars AT&T invests is 7,000 hard-hat jobs." Not "entry-level jobs," AT&T promised, but "7,000 jobs of people putting fiber in ground, hard-hat jobs that make $70,000 to $80,000 per year."
Yeah, about that.
The Trump tax cut resulted in AT&T getting billions in immediate tax relief, and roughly $3 billion in tax savings annually, in perpetuity. Yet when it came time for AT&T to re-invest this money back into its network and employees, AT&T actually did the opposite and began laying them off in droves. Unions claim AT&T has laid off an estimated 23,000 workers worldwide since the Trump tax plan, with investors and executives unsurprisingly pocketing the savings. This week, the word came down that AT&T would be laying off thousands more as it wraps up fiber deployment:
"Leaked internal documents confirmed most of the 1,800 planned job cuts. One AT&T surplus declaration shows that more than 900 of the surplus jobs come from the company's Southeast division in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee. This document attributes most of the cuts to "economic" reasons and some to "technological/operational efficiency."
AT&T employees took bribes to plant malware on the company's network
AT&T employees took bribes to unlock millions of smartphones, and to install malware and unauthorized hardware on the company's network, the Department of Justice said yesterday.
These details come from a DOJ case opened against Muhammad Fahd, a 34-year-old man from Pakistan, and his co-conspirator, Ghulam Jiwani, believed to be deceased.
The DOJ charged the two with paying more than $1 million in bribes to several AT&T employees at the company's Mobility Customer Care call center in Bothell, Washington.
The bribery scheme lasted from at least April 2012 until September 2017. Initially, the two Pakistani men bribed AT&T employees to unlock expensive iPhones so they could be used outside AT&T's network.
[...] This initial stage of the scheme last for about a year, until April 2013, when several employees left or were fired by AT&T.
That's when Fahd changed tactics and bribed AT&T employees to install malware on AT&T's network at the Bothell call center. Between April and October 2013, this initial malware collected data on how AT&T infrastructure worked.
According to court documents unsealed yesterday, this malware appears to be a keylogger, having the ability "to gather confidential and proprietary information regarding the structure and functioning of AT&T's internal protected computers and applications.
The DOJ said Fahd and his co-conspirator then created a second malware strain that leveraged the information acquired through the first. This second malware used AT&T employee credentials to perform automated actions on AT&T's internal application to unlock phone's at Fahd's behest, without needing to interact with AT&T employees every time.
The new millimeter-wave network, or what AT&T calls "5G+," will be available in "parts" of New York City, though parts may be a bit of a stretch. In its release, AT&T acknowledges that the service will be in "limited areas initially" with a company spokesperson telling CNET that the new service will be available first in parts "near and around East Village, Greenwich Village and Gramercy Park."
[...] "As a densely-populated, global business and entertainment hub, New York City stands to benefit greatly from having access to 5G, and we've been eager to introduce the service here," said Amy Kramer, president of AT&T's New York region, in a statement. "While our initial availability in NYC is a limited introduction at launch, we're committed to working closely with the City to extend coverage to more neighborhoods throughout the five boroughs."
[...] It is still unclear when AT&T will make 5G available to everyone, but the company plans to deploy a nationwide 5G network on its wider-ranging "sub-6" spectrum in the "first half of 2020."
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Lawsuit: AT&T signed customers up for DirecTV Now without their knowledge
AT&T supervisors encouraged sales reps to create fake DirecTV Now accounts to make the online video service seem more successful than it really was, a class-action complaint alleges.
AT&T "promot[ed] and reward[ed] account fraud" such as creating the fake accounts and signing AT&T customers up for DirecTV Now "without the customer knowing," the lawsuit claims.
The new allegations were made Friday in an amended complaint as part of a lawsuit filed against AT&T in April in US District Court for the Southern District of New York. The lawsuit alleges that AT&T lied to investors in order to hide DirecTV Now's failure.
"AT&T misrepresented the true condition of DirecTV Now and hid the associated risks," the amended complaint says. DirecTV Now's inevitable failure was subsequently made clear when subscriber numbers began to drop, the amended complaint says:
The dramatic decline in DirecTV Now subscriber numbers was a materialization of the risks associated, including: improper sales practices, such as the creation of fake accounts, which predictably led subscribers to cancel these accounts, upon realizing they were being billed for a service they did not use; the aggressive use of promotional campaigns to artificially sustain subscriber levels; and selling the product at irrationally low prices that would ultimately need to increase.
AT&T Explores Parting Ways With DirecTV:
Telecom giant considers fate of DirecTV satellite unit as cord-cutting saps subscriber base
AT&T Inc. is exploring parting with its DirecTV unit, people familiar with the matter said, a sharp reversal from Chief Executive Randall Stephenson's strategy to make the $49 billion bet on the satellite provider a key piece of the phone giant's future.
The telecom giant has considered various options, including a spinoff of DirecTV into a separate public company and a combination of DirecTV's assets with Dish Network Corp., its satellite-TV rival, the people said.
AT&T may ultimately decide to keep DirecTV in the fold. Despite the satellite service's struggles, as consumers drop their TV connections, it still contributes a sizable volume of cash flow and customer accounts to its parent.
AT&T acquired DirecTV in 2015 for $49 billion. The company's shrinking satellite business is under a microscope after activist investor Elliott Management Corp. disclosed a $3.2 billion stake in AT&T last week and released a report pushing for strategic changes. Elliott has told investors that AT&T should unload DirecTV, The Wall Street Journal has previously reported.
Related: https://soylentnews.org/article.pl?sid=19/09/18/1656205
Like Blockbuster, DirecTV, Dish, etc. are extremely slow to catch onto the whole Netflix/Amazon Prime Ad-Free, pick-what-I-want-to-watch model.
(Score: 1, Insightful) by Anonymous Coward on Thursday October 31 2019, @03:26AM
"AT&T already got much of the 5G spending out of the way by purchasing spectrum licenses"
Locking out the competition. Sweet.. No hurry to DO anything with that valuable asset now.
(Score: 1) by Sally_G on Thursday October 31 2019, @03:50AM (2 children)
This means they will be cutting my bills? /sarcasm
(Score: 0) by Anonymous Coward on Thursday October 31 2019, @04:02AM
Cut your own bills by porting your number to a competitor that charges less. There's no shortage of MVNOs for you to choose from.
https://en.wikipedia.org/wiki/List_of_United_States_mobile_virtual_network_operators [wikipedia.org]
Sort the table by Host Network if you want to stay on AT&T for signal coverage.
The alternative is to continue whining pathetically like you're doing now. Your choice.
(Score: 2) by JoeMerchant on Thursday October 31 2019, @01:40PM
AT&T had two lines (multiple twisted copper pairs) running to my house when I bought it in 2012. I doubt the previous owner used their service, I never have. 6 months ago a branch fell from a neighbor's tree and cut those lines - boo hoo. I don't see them coming out to fix them, and I suspect they have similar "infrastructure savings" all around the country.
🌻🌻🌻 [google.com]
(Score: 0) by Anonymous Coward on Thursday October 31 2019, @04:13AM (2 children)
No, not AT&T, the America.
It's the same old story - it rots from the inside.
(Score: 0, Disagree) by Anonymous Coward on Thursday October 31 2019, @04:18AM
Americans have become lazy unskilled bums who would rather be fishing than working and who complain bitterly that they would have to pay taxes if they did work. In other words, America is a whole country of "Mighty" Buzzards.
(Score: 0) by Anonymous Coward on Thursday October 31 2019, @04:25AM
Verizon is the true heir of the original Bell Telephone Company. The newly named AT&T is formerly known as shitty Southwestern Bell.
(Score: 3, Interesting) by hwertz on Thursday October 31 2019, @06:18AM
AT&T's done this before... they'll cut spending, then, several years later it's like "How did our network get so bad?" When the iphone came out as an AT&T exclusive AT&T's network rather comprehensively crashed and burned. The news narrative was that "no carrier" could have handled this surge... but... a) The overseas carriers that got iphone exclusive handled it fine. b) Verizon Wireless at the time said they had a larger quarterly increase in data use than AT&T, from android phones and air cards mainly. In actuality, AT&T was just at the tail end of a previous cycle of reduced network investment.
That said, playing devil's advocate, I suppose it's possible all that modernization (the years-long conversion that AT&T, T-Mo, VZW, and I suppose Sprint have done from telecom-style internals to more IP and VOIP-style) has paid off and the equipment is far less expensive, spend less for the same amount of upgrades.
(Score: 0) by Anonymous Coward on Thursday October 31 2019, @07:12AM
So there will be a reduction in good paying blue collar jobs just in time for the election and to depress the economy and favor whoever challenges Trump.
(Score: 2) by sjames on Thursday October 31 2019, @09:09AM (2 children)
Can someone explain again how allowing more mergers and slashing network neutrality will surely increase investment in infrastructure?
(Score: 2) by deimtee on Thursday October 31 2019, @11:05AM
Well, it lets you pay hundreds of millions to the CEO's and board members. How can you expect them to produce their best work without an incentive?
200 million years is actually quite a long time.
(Score: 2) by JoeMerchant on Thursday October 31 2019, @01:49PM
Somehow, any company that carries the name AT&T also carries the inherently evil spirit that grew in the original monopoly. Let it die, it's entirely redundant these days.
🌻🌻🌻 [google.com]
(Score: 3, Insightful) by DannyB on Thursday October 31 2019, @03:31PM (7 children)
Hey AT&T,
What if instead of fighting net neutrality, adding hidden fees, taking subsidies for things you don't do, and other bad things, what if you tried something different.
Stop interfering with customer's packets and traffic. No tracking. No deep packet inspection. No extra "services". DO NOT be a content provider AND a provider of the pipes the content flows over. Stop trying to create shady back room deals with, say, Netflix, holding Netflix-AT&T customers hostage so that those customers only get good Netflix connections if Netflix pays AT&T some extortion money.
How about this idea instead:
Just be big, dumb, pipes.
The biggest, dumbest pipes ever. Do this and do it well. Do it better than your competitors. Route traffic and nothing more. Manage congestion, etc. Just do it the very best.
Doing something honorably and well is a very time honored way of doing business and succeeding at it.
But I guess they don't teach that at MBA school.
The server will be down for replacement of vacuum tubes, belts, worn parts and lubrication of gears and bearings.
(Score: 2) by JoeMerchant on Thursday October 31 2019, @07:24PM (6 children)
How does this maximize profit?
Why would we sell a simple, easy to understand, commodity service when we can complexify it up until it's as incomprehensible and un-comparable as a mattress specification. Once we've decoupled the service we provide from any market competition, we're free to adjust prices as we see fit. Lure customers in with $300 cash payment on signing of a contract - nevermind that the contract costs $2K over the coming 24 months for the same essential services the competitors are selling for $30 per month - we've decoupled ourselves from price comparisons. Our initial quoted monthly fee is the same as theirs, but over the course of the contract the variable rates and hidden fees (all clearly spelled out on pages 27 and later in 6 point and smaller font) will escalate to guarantee PROFIT, which, after all, is what business is all about.
🌻🌻🌻 [google.com]
(Score: 2) by DannyB on Thursday October 31 2019, @08:14PM (5 children)
Maybe I'm wrong. Maybe things have changed.
Once upon a time, doing something the best, better than your competitors, was a way to get ahead. Win loyal customers. Those customers are your best and free salespeople.
The server will be down for replacement of vacuum tubes, belts, worn parts and lubrication of gears and bearings.
(Score: 2) by JoeMerchant on Thursday October 31 2019, @11:21PM (4 children)
Wish in one hand, defecate in the other - see which fills up first...
I'm not sure that straight up competition for commodity services ever really existed except in our rose colored filtered memories. There have been some accidental competitive markets that worked quite well, and we tend to remember those, but forget the landscape of corruption that has always surrounded them.
Nobody sets out to run a business to obtain the lowest profits possible, and that's what open, simple, straightforward competition does.
🌻🌻🌻 [google.com]
(Score: 2) by DannyB on Friday November 01 2019, @05:37PM (3 children)
The goal isn't the lowest profits possible.
The goal is the best service at a reasonable price. This tends to ensure long term profits.
The server will be down for replacement of vacuum tubes, belts, worn parts and lubrication of gears and bearings.
(Score: 2) by JoeMerchant on Friday November 01 2019, @07:59PM (2 children)
Whose goal? Consumers? I don't often see consumers setting rules or rates for services.
In fantasyland, sure. In the publicly traded world, growth is expected along with ROI, at least 5% CAGR between them and more if you can manage it. How do you get that growth? Well, this quarter marketing has come up with a new way to trick people into paying more for services that cost less to provide than the services they are currently using: AT&T charging more for touchtone vs rotary dialing comes to mind immediately, but there are millions of examples, every year.
Exceeding CAGR targets means big upswings in stock prices, which mean even bigger swings in instruments like the stock options that corporate leadership are, almost universally, compensated with. Once a CEO has achieved several consecutive years of exceeding expectations on the street, it's time for him to step down and let some other sucker take the fall for his hyperinflated fee structures and other schemes that netted him hundreds of millions in compensation. Maybe move to another company whose executives are hopeful he can repeat the process for them.
Mom and pop's hardware store down the street? sure... consistent quality and service at reasonable prices kept them in comfortable business for decades, at least until players like the Wal family came to town.
🌻🌻🌻 [google.com]
(Score: 2) by DannyB on Friday November 01 2019, @08:17PM (1 child)
Public Utilities Commission setting rates to protect consumers so that levels of abuse are limited.
The server will be down for replacement of vacuum tubes, belts, worn parts and lubrication of gears and bearings.
(Score: 3, Insightful) by JoeMerchant on Saturday November 02 2019, @12:04AM
You mean regulation - oh the horror, the pure unadulterated eeeeeeeevil. /s
Yeah, I actually liked flying when it was a regulated industry, but the prices were quite steep. The phone company surely did suck when it was regulated though, and as I recall they were charging us $20 per hour to transmit voice 30 miles or more.
What's really needed are regulators with the balls, and teeth, to get up in the regulated's business and force them to do the right thing, and in our society it seems that the so-called free market is a little better at that than publicly elected and/or politically appointed oversight. Neither is perfect, and I don't think we've found a magick cocktail of the two that works any better.
I like the notion of radical transparency, particularly for industries so essential to the public interest like communication, transportation, and government. Open the books, 100%, independently audited - deeply, and publish the findings timely - let the public see, and comment, and draw up their own rates plans that ensure a fair wage to workers who provide excellent service, and screw the shareholders - government buyout and takeover as soon as the independent management analysis knows what they are dealing with.
🌻🌻🌻 [google.com]