Save Access

from: Nieman Watchdog

Verizon, AT&T and the manipulation of public opinion

COMMENTARY | April 04, 2007

Needed: Blacks, Hispanics, disabled, deaf, low-income and the elderly to support the telecoms’ positions on anti-consumer FCC rulings and legislation.

By Bruce Kushnick
bruce@newnetworks.com

DEFINITIONS:

* Astroturf—An organization set up by a large corporation or corporations to put forward the corporate agenda but to look like an authentic 'grass-roots' group.
* Co-opted—An authentic group that is given funding by a large corporation or corporations, where the group lobbies for corporate initiatives even if they are contrary to the needs of its members.
* Skunkworks—A well coordinated campaign funded by large corporations (or industries) that incorporates Astroturf and co-opted groups, research think tanks, PR firms, lobbying firms, state and federal politicians to put forward the corporate agenda on a specific topic.

Over the last few weeks numerous groups have been lobbying and hyping the corporate position of AT&T and Verizon for relaxed cable franchise requirements or to stop any net neutrality legislation.

Some of these groups are working together to supply a message that blacks, Hispanics, seniors, low income, deaf or disabled persons care about these issues – and that they back the AT&T and Verizon positions.

A release from a group called Video Access Alliance in mid-March, for example, titled "Video Industry Organization Voices Support for Broadband Deployment and Consumer Choice,” outlines how numerous groups support what it refers to as the FCC's "bold" cable television decision.

"Last week's video franchising order by the FCC was a bold and necessary step in providing consumers and new content providers alike with a more competitive and fair marketplace for cable television and broadband services. The Video Access Alliance commends the FCC and Chairman Kevin Martin for this decision, and we are not alone. Below are the words of just a few of the organizations representing a broad spectrum of constituencies and interests that support this action."

The press release goes on to quote Astroturf and co-opted groups representing the deaf, disabled, black, low income and others, all touting a plan to loosen cable franchise rules for the phone companies.

Some of the organizations quoted in the release are the American Association of People with Disabilities, the Internet Innovation Alliance, and the National Association of the Deaf, the Alliance for Public Technology, and the Video Access Alliance itself.

Other groups that sent out releases supporting the telecoms on this and related topics include the National Black Chamber of Commerce, Consumers for Cable Choice, Netcompetition, and the League of United Latin American Citizens (LULAC)

What do these groups have in common? They all receive funding from AT&T and/or Verizon, and then lobby for them.

[Click here for a description by my group, Teletruth, of the FCC decision in question and why it’s anti-consumer. Also for background: America is 15th in the world in broadband, in part because the phone companies failed to deliver on their promises to rewire America with fiber optics. Customers have already paid billions per state for that. On these issues, read our summary, written a year ago, for Nieman Watchdog.]

These "consumer" groups now are congratulating the FCC for doing a runaround of Congress (which did not pass legislation last session), by allowing the phone companies to pick and choose which communities, if any, will get new competition and without having to worry about commitments to the public, which is still paying for services not yet received.

Worse, AT&T and MCI (Verizon) are now raising local and long distance rates, especially harming low-income and low-volume customers, including seniors and the disabled.

You would think the consumer groups would be outraged and want an investigation of where all the money allocated for fiber optic broadband went or about the large increases to the price of service. Instead, the AT&T and Verizon-funded groups—some authentic but 'co-opted', others, such as Video Access Alliance, simply made up—are now attempting to confuse Congress, the FCC and the public into thinking that the phone companies have the support of blacks, Hispanics, seniors, the disabled and low-income families. (Click here to see what we’ve written on many these groups.)

This is all very sleazy. It is about deception. It is about playing on America's caring about the public interest and about minorities getting a fair shake. Video Access Alliance claims that blacks and Hispanics care about Verizon and AT&T cable plans and it is important to help these 'poor' misunderstood companies deliver cable services.

"This issue is extremely important for minority businesses and minority consumers," said VAA Chairman Julia Johnson. "Blacks and Hispanics spend more on telecommunications and media products and services than non-minorities. Studies indicate minorities have higher penetration rates for digital television. Minorities subscribe to more premium television channels like HBO and Showtime and minorities are the industry's best pay per view customers. We are high value customers with enormous buying power."

The conclusion one should draw is that these groups, while they themselves benefit from the phone companies’ funding, certainly harm their own constituents. Minorities typically live in areas that are not the rich neighborhoods that will be the first to be rewired. Seniors are not worrying about broadband issues and certainly spend less than most customers on telecom issues. And we doubt that the disabled are worried about 'premium' television programming.

Teletruth has no problem with large corporations donating money to non-profits. In fact, we encourage it. But the line should be drawn when a group starts lobbying for the phone companies, even if the money it received has nothing to do with the corporation's business, or when a group takes the money in exchange for doing corporate favors – like lobbying.

The reason Astroturf, co-opted, and skunkworks groups should be 'outed' is simple – these organizations have very deep-pocketed funders with lobbying groups, PR firms, and others to get them the loudest "volume" in the media or access to regulators and legislators. They often overwhelm the message of independent consumer groups.

Teletruth suggests national legislation be created to stop deceptive practices. Imagine the removal of thousands of groups' non-profit status for lobbying for their large corporate benefactors. IRS regulations state that for a citizens group "to be tax-exempt as an organization described in IRC Section 501(c)(3) of the Code ... it may not attempt to influence legislation as a substantial part of its activities and it may not participate at all in campaign activity for or against political candidates".

In our view, every organization should be required to identify all major contributors before taking part in public meetings, filing comments, and so on. This would clear up the deceptive practices issue.

In the movie Man of the Year, Robin Williams, playing a comedian running for president, recommended that all politicians and organizations be required to wear a 'NASCAR' jacket, showing all of the sponsors on their 'sleeve', as it were.

When AT&T and MCI were separate long distance companies they had their own 'Astroturf groups, research firms, etc., that gave balance to the political forces. Today, with the mergers and consolidations, AT&T and Verizon not only own the local phone companies and the long distance companies, but they are also the largest wireless companies. There is no longer a serious 'other side'. The Cable companies are simply not going to defend customers' rights against the abuse of other large corporations.

The public voice needs to be on equal footing with the deceptive organizations that are using ethnic diversity or disabilities as 'marketing', putting corporate initiatives over the public interest.

Bruce Kushnick has been a telecom analyst for 24 years, and is currently the chairman of Teletruth, an independent customer advocacy group focusing on broadband and telecom issues, as well as executive director of New Networks Institute, a market research firm.
E-mail: bruce@newnetworks.com