Get Out: Spectrum, owned by Charter Communications, has 60 days to completely end its business in the State of New York.
In 2016, Charter Communications gained approval for its buyout of Time Warner Cable (TWC), giving broadband consumers one fewer option in most states. Now it looks like New York has gotten fed up with the lack of fulfillment from Charter’s side of the merger approval process, as the state has banned its Spectrum service from operating in the state.
New York has given Charter Communications 60 days to stop operating within the state’s borders.
The New York Public Service Commission (PSC) released a strongly worded statement about the issue, saying the company has made it clear it has no intention of fulfilling its half of the public benefits that were required for the merger approval to happen in the first place.
According to the PSC, Charter has failed to meet deadlines and has skirted its obligations to provide service to rural New Yorkers. Additionally, the PSC alleges that Charter specifically sought to obfuscate its noncompliance with the 2016 merger agreement.
Amongst the many shortfalls, PSC outlined the following issues:
- Charter’s repeated failures to meet agreed-upon deadlines;
- Numerous attempts to skirt commitments to serve rural communities;
- Numerous instances of unsafe practices in the field;
- Blatant failures to fully commit to its obligations under the 2016 merger agreement; and
- ‘Purposeful obfuscation’ of performance and compliance obligations to the Commission and its customers.
PSC Commission Chair John Rhodes says after more than a year of noncompliance on Charter’s part, his organization is now moving forward with stronger actions taken against the corporation for their willful ignoring of the merger’s approval terms.
Rhodes says the company’s refusal to honor the original terms of the merger agreement is “brazenly disrespectful” to the New Yorkers the company was supposed to serve.
PSC is seeking court-ordered penalties against Charger to revoke merger approval and requires the service provider to continue serving customers for the 60 days they have before ceasing operations in the state.
Charter blamed the extreme penalty on politics — including disagreements over net neutrality.
And elephant in the room is net neutrality, something Charter has spent tens of millions to overturn on a federal level. Late last year, a compliant FCC agreed to reverse net neutrality laws, despite overwhelming opposition from states and local customers.
Charter, along with rivals like Comcast and Verizon, were accused of buying the compliance of FCC chairman Ajit Pai. The result is an extremely hostile regulatory environment in critical states like New York, which vehemently oppose the federally-forced provision.
“In the weeks leading up to an election, rhetoric often becomes politically charged,” Charter stated, a tacit reference to net neutrality.
“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.”
Charter has indicated that it will fight the order, and the company is still accepting new customers in the state.
But the PSC has said it will seek injunctive relief from the Supreme Court if Charter does not comply with all of the state’s requests, including paying a $3 million penalty for repeatedly avoiding fulfilling the original terms of the merger’s approval.
It remains to be seen if other states will follow New York’s example in attempting to hold broadband providers accountable for their service to residents across the United States.