AT&T loses key ruling in bid to stop offering basic phone service in California

California has dealt a setback to AT&T's efforts to cease providing basic phone service, ruling that the company must continue to fulfill its Carrier of Last Resort (COLR) obligations. The state said its rules are technology-neutral, allowing AT&T to use wired, wireless, or VoIP services to meet those obligations. However, California noted that AT&T has never formally sought to replace traditional copper-based POTS with its wireless AT&T Phone-Advanced (AP-A) service.

California argued that AT&T does not want to meet its COLR obligations through AP-A; rather, it seeks relief from meeting them altogether. In its lawsuit, AT&T did not claim it will offer basic service via AP-A or any other alternative. The state said AP-A does not comply with requirements including flat-rate unlimited calling options, discounted Lifeline rates for low-income customers, and telephone relay services for the deaf and hard of hearing.

AT&T has also petitioned the FCC to preempt California's regulations, claiming state rules block the replacement of copper with fiber. California has called those claims false. Advocacy group The Utility Reform Network told the FCC that AP-A is unsuitable for California due to its mountainous terrain, forests, and extreme weather events. The group noted that AP-A battery backup lasts only 24 hours, insufficient for prolonged power outages from wildfires or earthquakes.

Additionally, AT&T has filed requests with the FCC to discontinue copper-based service to 184,000 residential and 15,000 business customers effective June 1, 2027. Those requests were granted automatically after a comment period, but the FCC has yet to rule on AT&T's broader request to override California's rules. If the FCC does grant preemption, California could challenge the order in court.