Cities Sense AT&T Slowdown

AT&T Broadband last week denied that its system upgrades have been lagging while capital spending budgets are reviewed.

But officials in some cities report being informed that AT&T's construction budgets are now scrutinized on a quarterly basis, resulting in a slowing of upgrade projects.

In Wheaton, Ill., where an upgrade of the 13,000-subscriber system was halfway done, an AT&T executive last week told a local official that construction had stopped.

"AT&T has no capital at this time,'" said Wheaton media manager Gary White, quoting the AT&T representative.

White said another AT&T executive told him that funds for the upgrade in the community 25 miles west of Chicago might be reallocated by the second quarter.

"But I'm taking whatever they say with a grain of salt," White said. "It seems like we've been led on. Right now, there's a bad taste in everybody's mouth."

In Denver, meanwhile, officials had noticed a $200-million upgrade of AT&T's 116,000-subscriber system had slowed in recent weeks.

"I was unofficially informed this week that construction budgets are now reviewed quarterly and that may or may not impact the upgrade schedule," said Dean Smits, director of the Denver Office of Telecommunications.

AT&T officials said upgrades were not on hold in the communities surrounding Chicago. Instead, a change had been made in the local organizational structure calling for a more "methodical" approach to the projects.

"It's be much more efficient, and will allow us to use our manpower better," said Pat Andrews-Keenan, AT&T vice president of communications. "But by no means are these communities not scheduled for upgrades."

Andrews-Keenan said the Chicago area upgrades are a massive project that began in the mid-1990s and grew even more complex as the acquisition of local MediaOne and Prime Cable properties were completed.

"That's not what I was told," White answered.

Multichannel News was unable to locate another community in the Chicago area that had been told its upgrade was being shut down.

But in nearby Naperville, officials reported "rumbling from other communities that have AT&T as a provider."

AT&T corporate spokesman Steve Lang said the company plans to concentrate on increasing penetration in already upgraded areas may give the impression that upgrades have slowed.

"Seventy-five percent of our plant already two-way," he said. "There's a lot of plant that we can connect and start marketing to."