Charter Communications is one step closer to losing its license to operate in New York City, if not New York state as a whole. Earlier this year, the state of New York’s Public Service Commission – its equivalent to the California Public Utilities Commission – slapped a $1 million fine on Charter and said it would “investigate Charter’s compliance with its New York City franchise agreements”.
That investigation seems to have led to legal action. Speaking on behalf of New Governor Andrew Cuomo, a spokesman for the commission said the gloves are off…
The New York State Public Service Commission has commenced legal action against Spectrum Media Company for potential violations of its franchise agreement. The State approved Spectrum’s acquisition and its ability to operate in New York based on the fulfillment of certain obligations, including providing broadband access to underserved parts of the State and preserving a qualified workforce.
“The Governor believes it is essential that corporations doing business with the State uphold their commitments, and we will not tolerate abusive corporate practices or a failure to deliver service to the people.
”Large and powerful companies will be held to the same standard as all other businesses in New York. The Spectrum franchise is not a matter of right, but is a license with legal obligations and if those are not fulfilled, that license should be revoked."
It’s not clear if the New York commission is specifically going after Charter’s New York City franchise, or its ability to operate statewide. Either way, it will put a giant hole in Charter’s balance sheet if it’s successful. That’s a strong incentive to negotiate a settlement.
Charter also has obligations in California, that likewise stem from its purchase of Time Warner Cable in 2016. Among other things, by November – thirty months after the deal closed – Charter must “convert all households in its California service territory to an all-digital platform with download speeds of not less than 60 Mbps”. That includes all its analog systems in Kern, Kings, Modoc, Monterey, San Bernardino and Tulare counties.