AT&T’s Bid to End Carrier of Last Resort Role in California Likely to Fail, Ensuring Continued Landline Service for Rural Areas

AT&T will likely have to continue as the carrier of last resort in California, relieving some anxiety about the future of landlines in rural parts of the state. A carrier of last resort, or COLR, is a telecommunications provider that is required to offer basic services, usually a landline, to anyone in its service area who requests it. The service must be safe, reliable, and affordable, according to the CPUC, or California Public Utilities Commission. Last year, AT&T, the largest COLR in the state, filed an application with the Commission to be relieved of that obligation. 

Now the judge handling the case is recommending that the Commission vote to dismiss the application, which they could do as early as June 20th.

After AT&T sent letters to its customers, alerting them of its intentions, thousands of public comments poured in from people saying they need their landlines because cell phones and internet are not reliable where they live. Law enforcement and firefighters raised the alarm about the public safety implications of people in lightly populated areas losing their only form of technological communication. Public participation hearings around the state went on for hours as people pleaded with Commissioners and the judge to deny the application. At the hearing in Ukiah on February 22, people sat in the courtyard after the Board of Supervisors chambers and an overflow room were filled to capacity. National headlines that day were full of stories about an hours-long AT&T network outage.

At that hearing, Tedi Vriheas, Vice President for External Affairs in California, said landline service is already in decline, and the company wants to start providing customers with more advanced technology. She testified that, “All of our customers will have access to voice service, and especially 9-1-1. In addition, we will continue to provide service to areas where we are the only provider, including in rural areas…We will work to upgrade and to create copper phone lines to ensure customers have better technologies, either from us, or another provider…We will invest in our modern high-speed networks to help keep our customers, our first responders and our communities in California connected. Today, there are dozens of companies providing voice services in California. The competition is here. And it is robust.”

Regina Costa doesn’t buy it. She’s the telecommunications policy director for TURN, The Utility Reform Network, a ratepayer advocacy organization. “AT&T is touting this application as pro broadband,” she remarked. “Let broadband be free, let AT&T go free and a thousand flowers will bloom. Just relieve us of this horrible obligation and we will put broadband all over the place. But as the judge pointed out, nothing in the application actually does that. There is a lot of could, and would.”

Under questioning at the hearing in Ukiah, Vriheas was unable to lay out a plan. When Administrative Law Judge W. Anthony Colbert asked for specifics, Vriheas replied that, “It’s my understanding that the definition of alternative service would be worked out through the evidentiary proceedings.” The crowd booed and hissed, and Colbert called for order. 

On Friday, May 10, Thomas Glegola, the administrative law judge hearing the case, issued a searing decision recommending that the Commission dismiss AT&T’s application. He responded to Vriheas’ remarks, writing that, “AT&T’s public arguments paint the picture that the Commission’s COLR Rules require AT&T to retain outdated copper-based landline facilities that are expensive to maintain, or that AT&T needs Commission approval in order to be able to retire copper facilities and instead, invest in more modern technologies such as VoIP (Voiceover Internet Protocol), wireless, and fiber. These arguments are not accurate.” Noting that the company spent over $150 million on fiber in California last year, Glegola wrote that, “If AT&T’s arguments were accurate, this activity would be illegal.”

The judge’s recommendation hinges on the Commission’s requirement that before relieving the current COLR, another company be available to serve as carrier of last resort. But there is no such company in California. Glegola wrote that, “It is not clear why AT&T filed this Application, under existing rules, and then attempted to convince the Commission that it should ignore its rules, based on flawed and erroneous assertions regarding the law and regulatory policy that slowed down the adjudication of this proceeding.” 

Costa predicts that AT&T will attempt to convince the Legislature to relieve it of its COLR obligation. “The key thing for the public right now is to keep up the pressure,” she said. “AT&T was on its heels because there was so much public outcry opposing this,” including over 5,000 written comments. “You can still put public comments on this case into the Commission website,” she added. “And I would encourage people to do that.”

Interested parties can log into the CPUC docket (case number A.23-03-003), to read existing public comments and contribute their own.

Back in February, Vriheas made it clear that AT&T is determined. “COLR relief is not new,” she stated. “We have received COLR relief in 20 states. California is our last state.”

Earlier:

• Disconnected: Is this the Beginning of the End of Landline Services?
• Outcry Against AT&T’s Bid to Drop Landline Commitments at Yesterday’s PUC Meeting in Ukiah