California says AT&T lied to FCC in attempt to shut off old phone network

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FCC considers AT&T petitions to preempt state rules and discontinue phone service.

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Getty Images | KoldoyChris

California state regulators say AT&T lied to the Federal Communications Commission in an attempt to shut off its old copper phone network without providing an adequate replacement.

“AT&T asserts that California seeks to prohibit or hinder wireline carriers from discontinuing copper facilities and investing in fiber,” said a June 15 filing by the state of California and the California Public Utilities Commission. “Indeed, AT&T has been making this argument for years. It is not and has never been true.”

As we reported last month, AT&T sued California over the state’s refusal to let it stop providing phone service to all potential customers in its wireline network territory. AT&T also petitioned the Federal Communications Commission to declare that California cannot enforce its rules and to let AT&T stop providing service to about 199,000 phone customers.

Although California officials say AT&T is allowed to upgrade copper lines to better technology, such as fiber, AT&T has repeatedly claimed state rules force it to maintain the copper lines. For example, AT&T told the FCC in a petition that “in California, the aging, fragile, and expensive copper lines are still there, frozen in time by California regulations enacted by prior generations for the benefit of prior generations.” AT&T told the FCC in another filing that “California requires AT&T to continue offering POTS [Plain Old Telephone Service] throughout its territory.”

California told the FCC that, in reality, the CPUC declined to adopt rules that would prevent phone companies from replacing copper lines with fiber. In a 2008 decision, it decided that such rules would “discourage and delay fiber systems from being built in California, contrary to clear state legislative direction to bring affordable and widespread high quality communications services to all Californians.”

California: Wireless replacement not good enough

What AT&T wants is the ability to replace copper lines with wireless service in areas where the carrier decides that fiber upgrades wouldn’t be profitable enough. California says the wireless service is not an adequate replacement for wired phone service.

“AT&T’s discontinuance applications rely principally on the availability of AT&T’s LTE-based Advanced Phone service, and claim that affected customers are served by one or more ‘facilities-based mobile wireless’ provider as well,” California told the FCC this week. “AT&T has not shown, however, that the indoor mobile voice coverage in the affected areas—as opposed to the outdoor coverage—is sufficient to render wireless service an adequate substitute for AT&T’s wireline residential and business services.”

AT&T points to the FCC’s National Broadband Map to demonstrate its coverage capabilities, but this map “displays broadband, not voice, coverage,” California said. Meanwhile, the FCC’s Mobile LTE Coverage Map displays voice coverage but includes the disclaimer that it “depicts the coverage a customer can expect to receive when outdoors and stationary” and “is not meant to reflect where service is available when a user is indoors.”

AT&T’s own coverage data can’t show that its mobile network adequately replaces copper-based phone service, California said. The state filing quoted a disclaimer on AT&T’s website that the “map displays approximate outdoor coverage. Actual coverage may vary. Coverage isn’t guaranteed and is subject to change without notice.”

Because obstructions such as buildings and walls may affect wireless service quality, “mobile service provider maps cannot reliably determine that a wireless service is an adequate replacement for a wireline service without further proof of indoor coverage,” California said.

Price and 911 concerns

Without a service-quality guarantee for every customer, the wireless technology “conflicts with the requirements of the [FCC’s] Adequate Replacement Test,” California said. Instead of greenlighting AT&T’s applications, the FCC “should require AT&T to confirm with a high level of certainty that mobile coverage will be available to affected customer indoors, not simply outdoors,” California said.

California described several other problems with AT&T’s proposal to replace copper lines with wireless service, such as potential price increases and diminished 911 reliability:

Availability alone does not establish equivalency. A service should not be considered an adequate replacement for the wireline services AT&T now seeks to retire if it costs substantially more than the existing service; requires additional equipment purchases; depends on additional, customer-supplied broadband; fails during commercial power outages without customer-provided backup power; is incompatible with assistive technologies; provides inferior indoor coverage; or results in diminished 911 functionality or reliability. The existence of such barriers indicates that the proposed discontinuance may reduce consumer welfare and undermine the longstanding federal goal of universal service.

California said that AT&T Phone-Advanced (AP-A), a VoIP service that relies on the mobile network, could be “considerably more costly than California’s Basic Service: APA relies on a cellular signal or a separate Internet connection and Internet service plan. For areas of the state with a poor cellular signal—typically, rural and low-income areas—consumers would need to order and pay for a separate Internet service, assuming one is available, which would make AP-A more expensive than Basic Service.”

It is also unclear from AT&T’s applications whether AT&T Phone-Advanced supports the California Lifeline program that provides discounts for low-income households, or the California Relay Service for the deaf and hard of hearing, the state filing said.

State urges FCC to move slowly

AT&T said it has received relief from Carrier of Last Resort obligations in 20 of the 21 states in its wireline service territory. Carrier of Last Resort rules require phone companies to provide landline telephone service to any potential customer in their service territory.

The CPUC rejected AT&T’s request to end its California landline obligations in 2024. At the time, the agency urged AT&T to upgrade copper lines to fiber rather than shut down the outdated portions of its network.

In addition to its FCC petition, AT&T filed a lawsuit against California last month seeking an order that would preempt California’s Carrier of Last Resort rules. “California requires AT&T to spend $1 billion each year to maintain a century-old telephone network that almost no one uses,” AT&T alleged in its lawsuit.

Lawsuits can take years, but the FCC may be inclined to act on AT&T’s requests more quickly. Under Chairman Brendan Carr, the FCC issued an order that made it easier for carriers to discontinue copper networks and asserted that state rules are subject to preemption if they conflict with the FCC’s discontinuance authorizations and authority.

California regulators urged the FCC to move with caution. If the agency doesn’t reject AT&T’s applications outright, it should at least remove them from the streamlined process that could result in a quick approval, California said. California could ultimately sue the FCC if the agency tries to preempt the state rules.

“California opposes the applications as presented and respectfully asks the Commission to reject these applications,” the state said. “In the alternative, we ask the Wireline Competition Bureau to remove these applications from the streamlined process and ask the Commission to direct AT&T to address the concerns we have raised here.”

Jon is a Senior IT Reporter for Ars Technica. He covers the telecom industry, Federal Communications Commission rulemakings, broadband consumer affairs, court cases, and government regulation of the tech industry.

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