Lawmakers worry AT&T could use USF funds for LTE buildout

Congressional aides are concerned AT&T (NYSE:T) could use Universal Service Fund money to meet the LTE buildout goals the company outlined as part of its proposed $39 billion acquisition of T-Mobile USA.

The USF funds likely are going to be just one of many issues that come up tomorrow at a Senate Judiciary Committee hearing on the deal, the first of several such hearings Congress is expected to conduct this year. AT&T has argued that it will not need USF funds to meet its commitment to deliver LTE coverage to more than 97 percent of the U.S. population, covering an additional 55 million more Americans than AT&T's current LTE plans.

A spokesman for Sen. Amy Klobuchar (D-Minn.), who sits on the Judiciary Committee, said the senator was worried that AT&T could USF funds to fulfill its LTE goals, according to The Hill. Likewise, Senate Republicans also are concerned about the issue.

AT&T brushed back the questions. "Our commitment to bring broadband to an additional 55 million Americans is not contingent on the receipt of USF money," Joan Marsh, AT&T's federal regulatory vice president, told The Hill. While not ruling out the idea that USF money could help the buildout, she said it would be "speculative" to talk about the details at this point.

The concerns come just as the FCC is in the middle of reforming the $8 billion USF program to transform a fund that was intended to help pay for the deployment of telecommunications services in rural America into one that is more focused on broadband deployment. The USF reforms are expected to hurt rural wireless carriers by reducing payments they have received from the fund. However, that might be offset by money from the Mobility Fund, which the FCC proposed last year to fund mobile broadband deployments in rural areas.

For more:
- see this The Hill article
- see this Politico article

Related Articles:
AT&T files with FCC to acquire T-Mobile
Verizon seeking USF money for rural LTE buildout
FCC's USF reform likely to hit rural wireless carriers
AT&T to face first antitrust hearing this week over T-Mobile deal
AT&T to buy T-Mobile USA for $39B
Will regulators approve the AT&T/T-Mobile USA deal?
AT&T's justifications for T-Mobile deal run into static

Suggested Articles

The C-Band Alliance (CBA) now says the U.S. could see billions of dollars going to the U.S. Treasury if its auction of C-band spectrum gets approved.

T-Mobile appears to be working to gain favor in NY, promising more jobs in new tax revenue from a second new customer experience center in the state.

Google announced it’s bringing RCS chat services to Android users in the U.S.