Journalism in the Public Interest


Podcast: AT&T Neglects Low-Price Requirement to Help Poor Students


(Scott Olson/Getty Images)

As part of a government program developed in the '90s, millions of consumers are charged a small fee on top of their cell phone bill every month to help subsidize the cost of telecom and Internet services for America's schools: the poorer the school, the bigger the subsidy. The landmark bill collects about $2.25 billion each year, but instead of maximizing the benefit for the country's disadvantaged children, some of the money has gone toward boosting corporate profits, ProPublica's Jeff Gerth reports.

Gerth joins the podcast this week to explain his new investigation on the government's E-Rate program, how AT&T in particular has failed to train its employees on the low-price requirement, and how the Federal Communications Commission, which oversees the program, has failed to enforce the mandate.

Listen to the full podcast and read Gerth's corresponding piece: AT&T, Feds Neglect Low-Price Mandate Designed to Help Schools. You can also subscribe to all of ProPublica's podcasts on iTunes.

Emmett Smith

May 3, 2012, 7:32 p.m.

The government can’t mandate. That is what caused the housing collapse.

Emmett Smith

May 3, 2012, 7:34 p.m.

If the government mandates low prices, companies will go out of business and students won’t have anywhere to work when they graduate. Has this site turned liberal?

Kimberly Vassallo

May 3, 2012, 8:56 p.m.

What government mandate caused the housing collapse? I thought it was a lack of oversight that caused our economic meltdown. This while corporations continue to gobble up every natural resource on the face of the earth. Large corporations are paying 0 taxes and America’s middle class is going the way of the horse and buggy. People who were already on the lower social economic ladder are really suffering. Let’s just blame illegal immigrants or some other marginalized group. In the mean time keep buying your ipads made by slave labor in some develpoing country that’s being exploited by the World Bank and IMF.

Emmett, there are two things to consider, here, beyond “government bad.”

First, it doesn’t cost AT&T a thousand bucks a month to give you or I residential Internet service, not even close (unless you’re the only customer in town).  A lower price for a handful of customers won’t kill them in the slightest.  On top of that, they’re collecting two bucks from each of us to cover part of that discount, so it’s not like they’re victims, even of that small amount.

Second, the telecommunications industry isn’t long for this world except through laws protecting them.  From some of the products I know are being rolled out in the next few years (starting with the Third World, where infrastructure is difficult), they’ll be in the same position that copper telephone lines have come to in the face of cellular and VoIP service.

steven douglas

May 5, 2012, 9:01 a.m.

@ Emmett - You obviously prefer your thoughts pre-digested, but don’t confuse Fox “News” talking points with actual facts. The collapse of Wall St., banking, and housing came about because of the removal of regulation like Glass-Steagall (look it up), credit default swaps (look it up), derivatives (look it up) and a rigged credit rating system (look it up) and a complicit government that was pre-Obama.

It isn’t just AT&T doing this, it’s also Verizon, Comcast, and others. The fault lies with the FCC that was granted oversight, but can’t figure out how to enforce the mandate. The FCC claims it has no powers to make these companies apply the discounts to poor schools and educational facilities. The companies can and will run a line to the exterior of the building, but all interior lines are the responsibility of the facility. There is also a vague schedule mandated as to whether an ED facilities budget can support and pay for the interior wiring. This is how these companies can get away with overcharging school systems because they don’t meet the qualifications of the vague schedule. FYI at “” under Education. The Telecom companies are collecting millions to perform a service at discounted rates to poor educational facilities, as mandated by Congress, but, again, there wasn’t a common sense approach to application of those discounts. The Telecom companies also claim that sales personnel are trained in how to apply the discounts, but are failing in that action because the training doesn’t cover all the aspects of how to do so, or is it they just aren’t trained to sell cheap?


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