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Telecom Association CEO Urges Wal-Mart and SAM'S CLUB To Disassociate From AT&T's15 January 2005
Today, the President and CEO of the United States Telecom Association (USTA) sent a letter to the CEOs of Wal-Mart and SAM’S CLUB urging the two companies to disassociate themselves from a scheme where AT&T exploits Wal-Mart and SAM’S CLUB customers’ goodwill for American troops to pad AT&T’s bottom line in a controversial phone card gimmick that is currently under review by the Federal Communications Commission.
“Knowing Wal-Mart and SAM’S CLUB’S commitment to delivering value and service in rural America, I am writing to share my concern that your customers and your brands are being exploited by a company seeking public relations ‘cover’ for its scandalous business practices, which are currently under review by the Federal Communications Commission,” explained Walter B. McCormick, Jr., President and CEO of USTA. If this activity continues, “the result for rural telecommunications and for the nation’s commitment to affordable, reliable access to a dial tone is devastating. To date, AT&T has admitted to avoiding more than $500 million in obligations owed to help maintain rural telecom networks and universal service.”
In this latest attempt to avoid paying what it owes, AT&T has employed a two-part scheme. In the first part, AT&T claims that because it briefly diverts long-distance calls between two towns in the same state to an out-of-state 800 platform, the company can avail itself of the lower rates carriers charge for interstate calls rather than paying the higher rates owed to local telecom providers for intrastate calls. The second part of the scheme involves playing a brief audio clip promoting companies like Wal-Mart and SAM’S CLUB. AT&T claims that by including this brief audio clip, calls placed using these cards are no longer phone calls but are instead “enhanced” services which have no obligation to support universal service, the joint industry fund that ensures affordable, reliable telecommunications services for rural and fixed-income Americans as well as for connecting schools and libraries to the Internet.
The letter explains that while hiding behind the flag for its own financial gain, AT&T has blocked rivals from donating free calls to military families. Also, this latest scheme raises consumer phone bills and undermines affordable, reliable telecommunications in rural communities.
“This is a case of for-profit patriotism, and it stands squarely at odds with what our member companies understand to be the core values of Wal-Mart and SAM’S CLUB,” explained McCormick. “We urge you to disassociate Wal-Mart and SAM’S CLUB from AT&T’s unconscionable refusal to meet its obligations to rural telecommunications and its cynical exploitation of the goodwill of all Americans toward our troops and their families.”
To view the full text of the letter, go to www.usta.org.
Source: United States Telecom Association
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