AT&T will offer low-cost broadband to get DirecTV deal approved

AT&T (NYSE: T) plans to offer low-cost Internet service of $5 to $10 per month to lower income consumers who receive food stamps if the FCC approves its pending acquisition of DirecTV (NASDAQ: DTV).

In an FCC filing, AT&T says that it would offer two plans for low income families. For the first plan, AT&T will provide a DSL-based service of up to 5 Mbps in its wireline footprint for $10 a month. Following a 12-month promotional period, the price will go up to $20 a month.

The second plan would address areas where it does not have the infrastructure in place to support speeds higher than 2 to 3 Mbps. Eligible consumers in those areas will be able to get a 1.5 Mbps connection for $5 a month for the first year. After 12 months, the price would rise to $10 a month.  

AT&T said the low-income discount program will be available for four years and would then expire. Applicants have to be eligible for the U.S. Government's Supplemental Nutritional Assistance Program (SNAP), the formal name of the food stamps program. Eligibility will be subject to annual recertification.

The telco's plan is similar to what Comcast (NASDAQ: CMCSA) offers. However, to be eligible for Comcast's Internet Essentials program, families must have school-aged children who qualify for free or reduced-cost school lunches.

Providing low-cost DSL access is only one concession that AT&T says it will make if the DirecTV deal is approved.

In a separate filing, the telco said that upon completing the acquisition it plans to bring its 1 Gbps fiber-to-the-premises service to 11.7 million customer locations. AT&T said the additional FTTP build would be "completed within four years after the merger's closing."

For more:
- see this FCC filing (.pdf)
- Washington Post has this article

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