AT&t paid up to $50 million in hotspot fees and data charges after the company closed its wireless network in 2019, the largest single payment it has made for the service.
The payments will be made in monthly installments, starting in January, according to a filing with the Securities and Exchange Commission.
The carrier said the payments are expected to cover about a third of the $50 billion it had previously paid to wireless operators and providers to keep the service running.
AT&S and Cricket Communications Inc., which owns the Cricket brand, agreed to pay about $1 billion in the 2019-20 period, a sum that is not expected to be fully paid by AT&ts, the company said.
AT &T’s payment will cover about three quarters of the costs of the network in 2021-22, according the filing.
AT will pay about half of the remaining cost, and Cricket will pay the rest, AT >T said in the filing, citing an agreement it reached with Cricket.
In an interview, AT Co. CEO Randall Stephenson said the company’s payments are part of its commitment to continue to provide consumers with high-speed internet access in a timely and cost-effective manner.
The payment, which has been approved by the Federal Communications Commission, will be “very significant” and will help the company keep the network operating at full capacity for the foreseeable future, Stephenson said.
The settlement will also help AT&Ts customers, he said.
“The settlement is a win-win for consumers, carriers and consumers,” Stephenson said in an interview.
“This is a huge win for us, because we can continue to innovate and build our networks and deliver more services at a lower cost.”
AT>t has been aggressively pursuing a number of innovative wireless services, including the $49.99 monthly fee for data use, but Stephenson said there are “many reasons to think that this is one of them.”
“We’ve always focused on the business model that works for us,” Stephenson told reporters Tuesday.
“We want to be able to offer high-quality, affordable, reliable, reliable high-performance services at the lowest price, and we’ve done that.”
AT <hts wireless network has been under heavy scrutiny in recent years as it struggled to keep up with wireless competitors and a number other companies have stepped up their attempts to offer their services at lower prices.
The company was also hit with a $1.9 billion settlement last year in a class action lawsuit that alleged that AT&t deceived consumers into paying more for its wireless service than they actually paid for it.
Stephenson said Tuesday the company was “not prepared” to accept that kind of settlement.
“If you have to pay for the cost of a service, that’s what we’re going to do,” he said in a telephone interview.
AT;&%;s chief executive officer Randall Stephenson and other executives said the settlement will help keep the company operating at its current high-capacity network capacity for at least another decade.
AT and Cricket have been among AT<hs biggest wireless providers for years.
AT is also among the largest pay-TV providers in the United States.
AT says its network can handle up to 100 times more data than rivals and is “100 percent more reliable than the network that we have now.”
AT; & ;ct’s wireless network is “designed to be more robust and resilient in a number timescales than most,” Stephenson added.
AT, which also owns DirecTV, has said it will be able continue to offer its service at lower costs than it offers its rivals.
Stephenson also said the wireless service will not be subject to the terms of the settlement.
AT has faced criticism over the years over the quality of its service and its lack of innovation.
In the summer of 2018, AT reported that it had lost $1 trillion in value since it went public in 2006.
In March 2019, AT lost a court battle to block the merger of AT&nt and Time Warner Cable, arguing that the deal would harm consumers.