clock menu more-arrow no yes mobile

Filed under:

AT&T Says It Still Plans to Expand High-Speed Internet in DirecTV Acquisition

AT&T explains what its CEO meant when he said uncertainty over net neutrality rules has caused it to pause future investments in high-speed Internet service.


AT&T wants to buy DirecTV, and to show government regulators the deal will benefit consumers (and thus win its needed approval), the company promised to bring high-speed Internet service to 15 million largely rural consumers.

But after President Obama this month proposed net neutrality rules that could see broadband services regulated like the old phone networks, AT&T CEO Randall Stephenson appeared to balk, saying his company would now delay building out its high-speed fiber network given the amount of economic uncertainty that level of regulation could create.

The Federal Communications Commission then followed up with AT&T and asked if Stephenson meant the company would now have to cut back on its commitment to extend broadband service as part of its $48.5 billion deal for DirecTV.

No, it clarified Tuesday in a response. AT&T still plans to go ahead with its broadband rollout to 15 million homes if its DirecTV deal is approved. But whether Stephenson was being a bit impolitic in his response to President Obama’s net neutrality proposal or not, it’s clear AT&T doesn’t want deep regulation.

Broadband providers altogether are wary of anything that might upset their growing industry, especially as they look for ways to add customers and improve profitability. Wireless carriers in particular say they spend billions of dollars each year on the infrastructure improvements needed to handle the burgeoning demands on their networks. That’s why they’re resistant to regulatory changes that might disrupt the industry’s economics.

Separately, AT&T also said its DirecTV deal would allow it to extend its high-speed GigaPower fiber network to an additional two million customers beyond those who live in the 25 metropolitan areas where the carrier planned to introduce the service.

But future investments in high-speed Internet are on hold, given the uncertainty of the regulatory environment, AT&T said in its letter to the FCC.

“While we have reiterated that we will stand by the commitments described above, this uncertainty makes it prudent to pause consideration of any further investments — beyond those discussed above, to bring advanced broadband networks to even more customer locations,” AT&T Senior Vice President Robert W. Quinn Jr. said in a letter to the commission.

This article originally appeared on

Sign up for the newsletter Today, Explained

Understand the world with a daily explainer plus the most compelling stories of the day.