5G: Cut Em’ Off at the Knees!



Contact: Bruce Kushnick, Managing Director bruce@newnetworks.com

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The IRREGULATORS have a court date — May 20th, 2019, and are looking for funding and partners to continue this case and make it stick. We are taking the FCC to court about its obscure accounting rules, which have had a massive impact that allowed Verizon and AT&T to transfer billions per state of the state public utility wired network construction budgets to illegally fund their wireless business—and 5G—and even charge local phone customers billions more, per-state.

Let’s be frank:

  • 5G wireless is a con. Period. 5 comes after 4 so there had to be a 5G after 4G.
  • It is, in reality, a wired fiber optic service with a small cell antenna that only has a range of 1-2 city blocks.
  • Once it is exposed that the fiber optic wire, for the most part, has been illegally cross-subsidized and funded by the state utility construction budgets…
  • 5G is no longer profitable if the service has to pay for the use of the fiber optic wires and the access fees and all of the other fees, like rights-of-way.
  • Worse, it is a con because it doesn’t ‘scale’. It can never, ever do rural areas where the distances alone make it unprofitable to run the fiber.

Exposing the fact that 5G will lose money, while delaying real wired solutions for high-speed broadband in cities, should even get investors, cities and the public pissed.

But when we detail and ask for the billions of dollars per state back to pay the customers that were overcharged to illegally fund the wireless business…fireworks.

IRREGULATORS v FCC is the first step to stop all of these harmful, if not illegal practices.

Why are AT&T and Verizon banging the drum on this 5G crap?  5G Wireless is nothing more than the new ‘shiny tech’ bauble—like some hypnotist putting some shiny thing in front of someone to put them under – and the promise of new tech has been used in every decade to get regulations and obligations removed.

Moreover, AT&T and Verizon et al. captured this FCC.  FCC Chairman Ajit Pai is a former Verizon attorney, while Commissioner Brendan Carr worked for Verizon, AT&T and even the wireless association, CTIA. Taking control of the FCC, they have created over 30 separate proceedings, each designed to get rid of any remaining regulations of obligations to offer wired services, and to be able to substitute wireless to the home, without any interference of state or city approval or oversight.  Moreover, all of the consumer protections and safeguards are being stripped away.

While common wisdom claims that there are no more ‘landlines’, there are over 120 million customers with phone service that use a wire, with 55 million that are part of the state utilities. However, this is a fraction of the lines in service that are NOT being counted.  AT&T never upgraded its networks to fiber optics to the home; U-Verse is a bait-and-switch, a copper-to-the-home service with a fiber wire somewhere within ½ mile. Meanwhile, these lines as well as DSL, alarm circuits, business ATM machines and all of the other ‘data lines’ are not counted as a line—they have been ‘reclassified’ as an “information service” or “interstate service”.

But there is a kicker to this: We found a structural flaw in every FCC proceeding. The FCC’s not only failed to examine the impacts their rules were having on the state financials, but it also excluded all ‘state-based’ revenues, expenses, broadband commitments, investments—everything. And every FCC decision and every state decision that AT&T, Verizon and CenturyLink present have all followed this flaw.

IRREGULATORS v FCC exposes that the FCC’s accounting rules that were designed to divide up all of these expenses of the different lines of business that use the wires and make sure that prices were ‘just and reasonable’, have become corrupted.  And if you want crazy – we uncovered that these rules were set to reflect the year 2000 – that’s right, 19 years ago and they are so deformed that they put the majority of all expenses into the wired utilities – which made them look unprofitable.

This caused major rate increases, it was used to claim that it was unprofitable for the companies to build in rural areas – causing the Digital Divide, and it saved the companies billions in taxes – per state.  As incredible as this seems, the FCC’s arrogance decided to continue this “freeze” for another 6 years—until 2024.

However, we caught them and now its time to take this to court. In 2015 an investigation started, based in part on our research, of Verizon New York, which is a $5 billion state utility. In July 2018, working with the CWA union, there was a settlement estimated to be worth $300-$500 million and it will bring 32,000 lines of fiber optics to unserved areas as well as maintain the existing copper.  And the investigation revealed the massive financial cross-subsidies of Wireless and the other Verizon businesses.

IRREGULATORS v FCC is a critical case. If we can get the court to hold the FCC accountable, all of the billions per state diverted to wireless services will be in question, and can be used to properly upgrade the states with fiber optics—or even give refunds to those overcharged. 5G Wireless will then not only be unprofitable, but laughed at—who would want a crap wireless service when a fiber optic wire is 1-2 blocks from their home?

The IRREGULATORS is an independent consortium of senior telecom experts, analysts, forensic auditors, and lawyers who are former staffers from the FCC, state advocate and Attorneys General Office, as well as telecom auditors and consultants.