East Coast: Verizon on the hook for landline hikes. West Coast: AT&T denies hooking $100m for 10Mbps broadband

AT&T and Verizon are taking heat on opposite sides of the US over their networks.

In California, AT&T is said to be pursuing a deal that would pay the telecom giant $100m to hook virtually the entire state up to "broadband" internet. California Assembly Bill 2130 will allow the state to fund the expansion of broadband networks to provide availability to 98 per cent of the state's population.

The bill seeks to expand internet access to rural communities in particular, where decent broadband can be hard to come by. To critics of the bill, however, it would also give AT&T – which is not named in the paperwork but expected by some to take on the task – a stranglehold in the state and allow it to offer 10Mbps connections. This speed is way lower than the federal standard of 25Mbps for a service to be considered truly "broadband" internet.

Telecom consultant Steve Blum said that thanks to recent amendments, the bill (which has not yet passed out of the committee stage) will help to further pad AT&T's bottom line without forcing it to significantly improve network speeds in many parts of the state.

"If AB 2130 passes, AT&T gets rid of pesky competition and annoying accountability, and walks away with most, if not all, of a $100 million gift from taxpayers," said Blum, who backs a rival bill.

AT&T, however, says that Blum's comments are "grossly inaccurate" and offered its own description of the bill:

AB 2130 has nothing to do with giving AT&T funding. The bill provides funding for the California Advanced Services Fund administered by the CPUC. Any statements to the contrary are a gross mischaracterization of the bill. AB 2130 addresses a critical need to fix and extend a program designed to bring high-speed internet to all Californians.

Meanwhile, in New York, Verizon is being accused of overcharging customers still on its copper landline phone network.

A report from consumer advocate group New Networks says that customers on Verizon New York copper lines in the Big Apple have been handed an 84 per cent bill increase since 2006 just on land-line phone rates.

Additionally, the report charges that Verizon has overstated its investments in new fiber lines and used "multiple sets of books" to shift costs and revenues between its various businesses in the area, including Verizon Wireless.

All of this, the report alleges, allows Verizon to extract a premium from its customers or move them onto more profitable services such as wireless or bundled FiOS packages.

"There has been a multi-year campaign by Verizon to get rid of regulations, not upgrade or maintain the wires and move customers onto the less regulated wireless service – because it makes the company more money, even though this is not better for the cities, states or the customers Verizon serves," New Networks claims.

The Register has reached out to Verizon for comment on the report. ®