AT&T offers too slow naked DSL for too much

AT&T continues to play games on the road to meeting their obligations under the agreement with the Federal government to allow their merger with BellSouth which stipulated that they offer unbundled DSL to their customers. They first offered this last year but at almost $50 (w/taxes) it was hardly a deal, in fact it was the same price as subscribing to their phone service and DSL bundled. Hey, but they claimed they were meeting intent of the agreement.

Today AT&T announced both a price cut (good) and a speed cut (bad) for said naked DSL service. Yep, it’s now more affordable at $20 a month (plus taxes remember) but get this, they throttled the speed down to a glacial 768 Kbps, about 1/5 the speed of my cable broadband.

“We said all along the merger between AT&T and BellSouth would result in consumer benefits and this is an example of that,” said AT&T spokesman John Britton.

It’s 2007 and we still don’t have the kind of telecommunications market that was promised to us with the 1986 Telecom Reform Act. I get on demand television, internet, and phone service options but I can only get them from one vendor, which increasingly is Comcast Comcash on the cable side or AT&T or Verizon on the phone side. We’ve had 10 Congresses since 1986, equally split between Republican and Democrat leadership, and we have yet to see the kind of marketplace develop that is the leader in the world despite the fact that the hardware and software innovations are predominately originated by U.S. companies.

Just yesterday I wrote about WiMAX investment creeping up and my hope for this technology. While enthusiastic about WiMAX I am also pragmatic about the fact that the same companies that screw us today are the ones capable of making the kinds of investments that a new technology like WiMAX requires to get off the ground therefore positioning them well to screw us tomorrow too. I keep hoping that a disruptive company, like Google, will see this opportunity and not be bound by decades of traditional telecom executive thinking, or that a private equity shop will see that subscriber loss among 2nd place telcos is self-inflicted and take one of these companies private. Sprint itself should be a prime candidate.

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