AT&T gets nearly $428 million from Uncle Sam to expand rural broadband

An AT&T sign is installed replacing what had been a Cingular sign on a wireless telephone store in Little Rock, Ark., in this 2007 file photo.
An AT&T sign is installed replacing what had been a Cingular sign on a wireless telephone store in Little Rock, Ark., in this 2007 file photo.
photo FILE - This Wednesday, Oct. 17, 2012, file photo shows an AT&T logo on an AT&T Wireless retail store front, in Philadelphia. AT&T reports quarterly earnings on Tuesday, April 22, 2014. (AP Photo/Matt Rourke, File)
photo FILE - In this May 14, 2014 file photo, an AT&T logo on a store in Dedham, Mass. AT&T Mobility LLC has been hit with a $100 million fine for offering consumers “unlimited” data, but then slowing their Internet speeds after they hit a certain amount. The Federal Communications Commission (FCC), which regulates the telecommunications industry, says the company misled consumers with the plans. Officials say the company would slow speeds dramatically at times, to levels lower than advertised. (AP Photo/Steven Senne, File)

AT&T said Thursday it will be expand the availability of its broadband Internet service to 1.1 million American homes with the $427.7 million the telephone giant will get in annual, ongoing support from the federal government's Connect America Fund.

The fund, which the FCC provides from phone tax and fee collections, will enable AT&T to deliver broadband at speeds of at least 10 Mbps for downloads and 1 Mbps uploads in rural areas where the cost of broadband deployment might otherwise be prohibitive.

"AT&T's acceptance of close to one-half billion dollars annually from the Connect America Fund represents a huge investment in broadband for its rural customers," FCC Chairman Tom Wheeler said in a statement today. "The financial support provided by American ratepayers will bring significant benefits to AT&T's rural communities, and we urge state and local leaders to help communities realize these benefits by facilitating the broadband buildout."

According to the FCC's latest Broadband Progress Report, nearly one in three rural Americans lack access to broadband Internet service, compared to only one in 100 urban Americans. The Connect America Fund is designed to close that rural-urban digital divide.

AT&T will get $26.1 million to add broadband service for 81,173 households in Tennessee; $25.3 million to add broadband service for 67,402 households in Georgia, and $23.2 million to add broadband service for 66,766 homes in Alabama.

EPB, which provides gigabit-per-second Internet service throughout Chattanooga, got more than $111 million five years ago from the federal stimulus program to build out its fiber-to-home network.

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