In an unprecedented move, the New York State Public Service Commission
has voted 4-0 to kick Charter out of the state. According to the
announcement (pdf) by the PSC, Charter has been given sixty days to file
a plan with the PSC that will "ensure an orderly transition to a
successor provider," including offloading the Time Warner Cable
territories acquired in the merger. The PSC also notes the vote was only
taken after more than a year of trying to get Charter to adhere to some
pretty modest broadband build-out requirements affixed to the deal:
"Charter's repeated failures to serve New Yorkers and honor its
commitments are well documented and are only getting worse. After
more than a year of administrative enforcement efforts to bring
Charter into compliance with the Commission零 merger order, the
time has come for stronger actions to protect New Yorkers and the
public interest," said Commission Chair John B. Rhodes. "Charter's
non-compliance and brazenly disrespectful behavior toward New York
State and its customers necessitates the actions taken today
seeking court-ordered penalties for its failures, and revoking
the Charter merger approval."
As noted previously, the state has been trying unsuccessfully for more
than a year to get Charter to actually comply with merger conditions.
Among them was the promise to expand broadband availability to around
149,000 homes across New York State, something Charter not only didn't
do, but actively misled regulators into thinking had already been
completed. In part, by claiming older, existing expansions were new
builds.
If you follow telecom (or other major megamergers) for any amount of
time, you'll quickly find that most merger conditions are pretty
theatrical in nature. Usually, said conditions are often proposed by the
companies themselves and were things they already had planned anyway,
making "accomplishing them" rather trivial, zero calorie affairs.
Companies sign off on these conditions because it helps them pretend the
merger actually benefits the public, and regulators sign off because it
provides cheap political brownie points and the illusion that companies
are being held accountable. Neither is usually true, especially in
telecom.
Even when the conditions are meaningful, it's pretty routine to see
telecom giants like Charter or Comcast ignore them completely, usually
with zero real repercussions. For its part, Charter issued a statement
claiming that this was all just an election year stunt by New York
Governor Andrew Cuomo:
"In the weeks leading up to an election, rhetoric often becomes
politically charged. But the fact is that Spectrum has extended
the reach of our advanced broadband network to more than 86,000
New York homes and businesses since our merger agreement with
the PSC. Our 11,000 diverse and locally based workers, who serve
millions of customers in the state every day, remain focused on
delivering faster and better broadband to more New Yorkers, as we
promised."
And while Cuomo's quest to protect his governorship from challenger
Cynthia Nixon likely isn't entirely absent from the move (beating up on
hated cable companies often provides easy political brownie points), the
state was forced toward tougher options after Charter ignored $3 million
worth of fines for missing merger commitments and misleading regulators.
This is also one of several long-standing state efforts to hold Charter
accountable to the public. New York is one of 23 states filing suit
against the FCC for its net neutrality repeal, and the state is also in
the middle of an ongoing lawsuit against Charter for not only providing
terrible service and slow speeds, but also for attempting to mislead
regulators on other fronts (including gaming an FCC system that uses
custom-firmware-embedded routers to test real-world speeds).
The move also has to be viewed in context of the newfound federal apathy
toward consumer welfare as illustrated by the elimination of broadband
privacy rules and net neutrality consumer protections. States are
increasingly trying to fill the void left by a Trump administration that
has made it abundantly clear (at least at the FCC) that openly pandering
to despised telecom monopolies and then trolling users about it is now
considered brainy tech and telecom policy.
It's very likely that New York State is simply trying to force Charter
to stop bullshitting and simply adhere to existing conditions, and most
consumer advocates I've spoken to think this simply ends with a Charter
settling and remaining in the state. Should Charter be forced to offload
its New York State assets to another company, that company would likely
be somebody like Comcast, which, based on consumer satisfaction studies,
wouldn't likely be much of an improvement.
https://www.techdirt.com/articles/20180730/11412540325/new-york-state-vot
es-to-kick-charter-out-state-poor-service-failing-to-meet-merger-conditio
ns.shtml