Selling the Anti-Bachmann Phone

Posted July 8, 2011 at 5:16pm

Credo Mobile, a liberal cellphone company, is always on the lookout for ways to poach left-wing customers from AT&T. This year, what could be better than a grinning Michele Bachmann?

So Credo put the Minnesota Republican Congresswoman and 2012 presidential candidate on a flier highlighting her tea party ties and AT&T’s contributions to conservatives in Congress.

“AT&T is a Major Corporate Donor to the Tea Party,” reads the flier, distributed at the liberal Netroots Nation conference last month. “Join America’s only progressive phone company.”

In past campaigns, Credo has evoked other conservative boogeymen — such as Karl Rove, Sean Hannity and Don Blankenship, the former CEO of coal giant Massey Energy  —  but this appears to be the first time the company has weighed in on electoral politics.

“She’s seen as the leader of the tea party, and the tea party really gets progressives fired up,” a former Credo employee told Roll Call. “They are so loud and so vocal that there needs to be a counter to it.”

Credo’s flier says AT&T gave $386,000 to Bachmann and members of the Tea Party Caucus for the 2010 elections.

According to data compiled by the Center for Responsive Politics, in the 2010 election cycle, political action committees and individuals associated with AT&T gave Bachmann just more than $10,000 of the $3.6 million that they contributed to candidates and political committees. By comparison, AT&T donors gave $77,000 to Speaker John Boehner (R-Ohio) and shelled out $36,000 to Senate Majority Leader Harry Reid (D-Nev.).

With 110,000 mobile customers, Credo, which resells services it buys from the Sprint network, cannot hope to rival telecom giants AT&T and Verizon. But through shrewd marketing and the support of a re-energized liberal grass roots eager to combat the tea party, the company has secured a niche in the cellphone market and in the progressive community.

“There’s never been a political powerhouse that’s completely funded by an apolitical business operation,” said Charles Chamberlain, political director for
Democracy for America, the liberal advocacy group founded by former Democratic National Committee Chairman Howard Dean. “On the online organizing side, they are one of the biggest out there. … And to [a] certain extent, they are one of the oldest.”

In 1985, prominent Democratic donor Michael Kieschnick founded the company, then known as Working Assets. It sold credit cards and long-distance telephone service before entering the mobile market in 2000. Unlike other similar progressive groups, Credo has not strived for media stardom. Kieschnick, who rarely speaks to reporters, declined to be interviewed for this article.

“He would much rather be known as a doer in the progressive community than someone who they read about in a news story,” the former Credo employee told Roll Call.

Credo contributes a portion of its annual revenue to liberal causes, while its team of political organizers rally a network of about 2 million activists around key liberal issues, from environmental protection to the appointment of Elizabeth Warren to head the government’s new Consumer Financial Protection Bureau.

In the past week, Credo volunteers canvassed for Democrats in advance of the Wisconsin recall elections for Republican state legislators, delivered a petition to New York Gov. Andrew Cuomo (D) asking him to preserve the state’s ban on hydraulic fracturing for oil and gas drilling, and directed thousands of calls to the White House pressuring President Barack Obama to protect Social Security, Medicare and Medicaid in the debt ceiling debates.

Becky Bond, the company’s political director, manages as many as 10 issue campaigns from her San Francisco office every week. That involves sending about 15 emails every day to mobilize customers and volunteers.

“To be a Credo Mobile customer — that’s an activist act,” she told Roll Call during a trip to Washington, D.C., last week to speak at an activist training boot camp hosted by the New Organizing Institute. “Instead of fundraising, we run a business to fund our activism.”

Of every customer’s monthly charges, 1 percent goes to liberal nonprofit groups. The bill itself doubles as a newsletter from the progressive world.

In the past four years, Credo has given $10.5 million to about 125 “progressive organizations working for social change” selected by its customers, according to its website. On top of that, the company contributed another $1.8 million to tree-planting groups, independent media, foreign countries suffering from disasters and voter registration projects.

The biggest recipient of Credo’s largess has been Planned Parenthood, which received $467,000 in that period.

During the last election cycle, Kieschnick personally gave at least $186,000 to predominantly Democratic candidates, nonprofits and 527 organizations, according to a CQ Roll Call analysis.

The company contrasts those numbers with the money Verizon and AT&T spend every year in Washington.

PACs and individuals associated with Verizon and AT&T have contributed a combined total of nearly $42.6 million to Republican causes since the 1990 election cycle, compared with $30.8 million to Democrats during the same period, according to a recent CRP report.

A spokeswoman for AT&T refuted the notion that the company favors Republicans in its political giving.

“Our political contributions are balanced and bipartisan,” she said. “Credo is a wireless competitor well-known for exaggerated statements in its attempts to win customers. This is simply more of the same.”

AT&T and Verizon do make significant contributions to charity — an average of 0.8 percent and 0.7 percent of pre-tax profits from 2007 to 2009, respectively, according to data compiled by the Chronicle of Philanthropy. In 2010, AT&T gave more than $148 million through corporate, employee and foundation giving programs.

Credo’s political marketing is also a boon for Sprint, the nation’s third-largest phone company, said Ronald Goodstein, a marketing professor at Georgetown’s McDonough School of Business.

“Sprint benefits indirectly when Credo does well because Credo is pulling customers from AT&T and Verizon,” Goodstein said. “Although they are not buying Sprint directly, Sprint is getting better capacity utilization of their services.”

Linking charities to a utilitarian product — like a cellphone — does not typically attract more customers, but a public personality, especially one as repugnant to liberals as Bachmann, could be very effective for Credo, he said.

“They can say, ‘These companies support wackos,’” he said. “There’s nothing in the technology that differs anymore … so now they are trying to relate to you politically.”

Alex Knott contributed to this report.