In an attempt to increase the pressure on the Federal Communications Commission to settle its new "net neutrality" laws, AT&T revealed that it will stop pouring investments into its nationwide fiber upgrade plan for new, high-speed connections to the Internet until the matter is resolved.
The statement made by Randall Stephenson, the CEO of AT&T, is the first business move made by an Internet provider as a response to the unexpected call by President Barack Obama to the FCC for the regulation of such companies to be treated more as public utility companies.
AT&T, planning to invest for high-speed fiber Internet connections in 100 cities in the United States, had been heavily spending on acquisitions but had decreased its estimated capital spending for next year.
Internet providers and Republican lawmakers are in protest of the proposal by Obama, saying that the stricter regulations on Internet traffic that will come with his decision would only suppress growth and investments in the industry.
As such, a high level of uncertainty now surrounds the business of Internet providers.
"We can't go out and invest that kind of money deploying fiber to 100 cities not knowing under what rules those investments will be governed," said Stephenson during an analyst conference.
The plan to deploy high-speed fiber Internet networks across 100 cities, including Los Angeles, Miami and Chicago, was unveiled by AT&T back in April. After months of preparation, AT&T is now shelving the plan.
The main focus of the FCC is to ensure that all Americans have access to a quality Internet connection. A blog post by the White House said that the plan by Obama should further this cause and would not create additional burdens to Internet service companies.
The companies are thinking differently though, with a plan to combat Obama's proposal to regulate them as public utility providers in Congress and in the courts.
Over three dozen Republican lawmakers sent a letter to Tom Wheeler, the chairman of the FCC, stating that the regulatory changes that were proposed by Obama were beyond the scope of the authority of the agency.
If the proposal pushes through, the government will gain more control over how Internet providers operate and how they are charging their customers.
While Internet providers are collectively against the proposal, consumer advocacy groups and Internet-based companies lauded Obama's call, stating that it was the only way to ensure "net neutrality," which is the concept that all traffic over the Internet should be equal.
