Tag Archives: new york

Charter and the State New York settle on terms for an honest broadband buildout

by Steve Blum • , , ,

Charter Communications won’t be thrown out of the State of New York. The Public Services Commission voted last week to accept a settlement that ends a dispute over whether Charter is meeting the obligations it accepted when its acquisition of Time Warner Cable systems was approved in 2016. It ends the threat that Charter could lose its franchise to operate cable systems in New York because, the commission said, Charter was “just lining its pockets”.

One of the points of contention was whether Charter could count addresses in New York City towards its commitment to build out broadband service to under and unserved communities. The New York PSC said it couldn’t, because there’s no shortage of broadband there. The settlement means that Charter will build out its footprint where it’s needed, according to the order adopted by the New York PSC last Thursday…

The 2019 Settlement Agreement…requires, among other things, that Charter continue to invest in network expansion to bring high speed broadband to 145,000 unserved and underserved addresses entirely in Upstate New York by September 30, 2021; that Charter provide $12 million in additional funds to further expand broadband coverage in Upstate New York beyond these 145,000 addresses; and, that Charter meet enforceable interim milestones and provide monthly reports to track its progress. The 2019 Settlement Agreement, will, in short, ensure that Charter’s network expansion only takes place in areas of Upstate New York where for the most part wireline broadband does not currently exist.

A similar dispute continues in California. Charter was likewise obligated to upgrade service in its Californian territory – old and new – by the California Public Utilities Commission, by the end of this year. The CPUC’s public advocates office (PAO) has been trying to verify that Charter is on track to meet that commitment, but hasn’t been able to get the information it needed to do so. In April, Charter was ordered to hand over the requested data “with substantive, complete, and accurate responses”. No word yet on whether they complied, but the fact that the PAO has scheduled a meeting with outgoing CPUC president Michael Picker’s telecoms advisors to discuss the case might be read as indicating that all is not well.

New York and Charter settle broadband buildout dispute, set 100 Mbps download standard

by Steve Blum • , , ,

Charter Communications has a tentative deal with the State of New York’s Public Service Commission and its public service department to keep its cable franchises there. Last year, the NYPSC began the process of revoking Charter’s authorisation to operate in the state by unwinding its purchase of Time Warner cable systems, because the company wasn’t meeting broadband build out obligations imposed when the deal was approved in 2016. According to the commission, Charter was, among other sins, attempting to “skirt obligations to serve rural communities” and was “just lining its pockets”.

That’s all water under the bridge now. The tentative settlement, which still has to be formally approved by the NYPSC, walks back the invective and sets out clearer rules for how Charter’s build out to 145,000 under and unserved homes will proceed. New broadband customers in New York City won’t count, and there are provisions that would seem to force Charter to build new lines in more remote communities.

The settlement also sets 100 Mbps as the minimum broadband speed that a home should have access to…

A residential housing unit or business is eligible to count as one of the required Total Passings if it is located outside of the boundaries of the City of New York and is not passed, served, or capable of being served (by either a standard or non-standard installation), by pre-existing network from Charter or any other provider capable of delivering broadband speeds of 100 Mbps or higher.

Charter would also give $6,000,000 to the State of New York, to be bundled into an existing subsidy program that pays for broadband upgrades. First dibs on that money will go to Internet service providers that can deliver 100 Mbps or better download speeds.

That’s a sharp contrast to California’s broadband subsidy program – the California Advanced Services Fund – which reckons acceptable broadband service to run at 6 Mbps download and 1 Mbps upload speeds. New York gets it right, at least on the download side: the minimum service level that delivers access to modern online services is 100 Mbps down/20 Mbps up.

Charter is also under the gun in California. It was obligated to upgrade its analog only systems to digital capabilities by last November, and its facing another deadline this year to upgrade broadband service in its digital systems to 300 Mbps capability. The California Public Utilities Commission’s public advocates office questioned Charter’s compliance late last year, and an administrative law judge ordered the company to turn over its deployment records.

I assisted the City of Gonzales with its successful effort asking the CPUC to force Charter to upgrade, also during the Time Warner review. I am not a disinterested commentator. Take it for what it’s worth.

CPUC orders Charter to prove its broadband upgrade claims

by Steve Blum • , , ,

Charter Communications was given ten days to deliver granular broadband deployment data to the California Public Utilities Commission yesterday. Administrative law judge Karl Bemesderfer granted a motion by the CPUC’s public advocate office (PAO) to force Charter to hand over information to support its claim that it is meeting the conditions imposed by the commission when its purchase of Time Warner and Bright House cable systems in California was approved in 2016.

Among other things, the commission required Charter to upgrade all of its Californian systems – new and old – to 300 Mbps download capability by the end of this year. The PAO hasn’t been able to verify compliance because the information it received “provided no explanation or supporting data to show how Charter identified or quantified the progress it claimed to have achieved”.

To fix that problem, the PAO

Requested census block level broadband deployment information similar to that provided by Charter to the Public Advocates Office during the proceeding [to approve the Time Warner/Bright House acquisition]…

And then made…

Additional requests for Charter to explain how it calculated the household percentages it provided in its December 2017 progress report letter, and to provide the data Charter used to perform the calculations.

Charter refused. So the PAO asked Bemesderfer to intervene. Despite Charter’s objection, yesterday’s ruling directs Charter to respond to the data requests “with substantive, complete, and accurate responses” by a week from Friday.

The details of the PAO’s data requests and Charter’s response are being treated as confidential. According to the commission’s 2016 decision, Charter must “offer broadband Internet service with speeds of at least 300 Mbps download” by 31 December 2019 to all of the broadband-capable homes in its new, expanded footprint.

I hope the PAO is asking for performance data as well as marketing data. It’s one thing to “offer” service, it’s quite another to deliver it.

Charter’s vague compliance claims should be publicly verified by CPUC

by Steve Blum • , , ,

Charter Communications claims it’s providing near-gigabit level broadband service in virtually all of its Californian territory. Well, some of its Californian territory: in a filing with the California Public Utilities Commission, in opposition to a formal vetting of its claims that it is complying with service upgrade conditions imposed by the CPUC when it received approval to buy Time Warner cable systems, Charter says “it is already making service available at 940 Mbps to over 99% of the relevant households passed as of the end of year 2018”.

The filing doesn’t define “relevant” although it’s easy to assume it means all Californian households that had access to broadband service at the time of the merger. Maybe that’s because that’s what it means. Or maybe because Charter is hoping that commissioners are sloppy readers and won’t notice the weasel word.

It is also to be hoped that commissioners will take notice of another filing by Charter earlier this month, in which it promised to finish analog to digital upgrades in several California communities later this year. That’s a direct admission that it hasn’t met another CPUC imposed condition that required those upgrades to be completed by last November. There’s been no public announcement, by Charter or the CPUC, that an extension was requested or granted, although I suppose it’s possible some kind of understanding was reached behind closed doors. Or maybe Charter is hoping that commissioners won’t notice the disconnect.

I know from personal experience that Charter’s first impulse when asked to document compliance is to withhold as much information as possible, offering only as much as you might otherwise glean from their advertisements and other public statements. The threat or reality of CPUC action is an effective way of holding them accountable for a promise, and for holding their attention while they make good on it.

The CPUC should not take self-interested and unverified statements written by Charter’s lawyers at face value. Nor should it allow Charter to hide everything behind a blanket claim of confidentiality. Now is a good time to take a hard, quantitative and verified look at how – whether – Charter has met all of the statewide conditions the CPUC imposed on it in 2016. The matter should be reopened, investigated and, absent a compelling reason to suppress specific information, the results and underlying data should be made public.


I assisted the City of Gonzales with its successful effort at the CPUC to force Charter to upgrade. I am not a disinterested commentator. Take it for what it’s worth.

Charter’s credibility and rural upgrade claims challenged by California regulators

by Steve Blum • , , ,

Charter Communications is facing another inquiry into whether or not it’s telling the truth about obligations it accepted when it bought cable systems owned by Time Warner and Bright House Communications in 2016. The California Public Utilities Commission was asked on Friday by its in-house watch dog – the public advocates office (PAO) – to re-open the case.

The PAO says that there’s reason to think that Charter is fiddling the books when it claims to be meeting broadband system upgrade requirements that were attached to the CPUC’s approval of the purchase. Charter is supposed to provide the CPUC with sufficient data to verify compliance, but it hasn’t done so and wants to put restrictions on whatever information it does offer, according to one of the PAO’s filings

On September 12 and 13, 2018, the Public Advocates Office explained to Charter that the Public Advocates Office’s analysis indicated that a much lower percentage of households had access to increased (higher than 300 Mbps) download speeds than the level Charter reported in its December 2017 letter. To more accurately verify the level of progress Charter has made, Charter must provide by census block, how many households Charter passes and the broadband speeds available to those households…

The Public Advocates Office objected to Charter’s condition that any information it provides must be used exclusively to verify progress report, because it inappropriately seeks to restrict how the information provided by Charter would be used by the Public Advocates Office.

Charter has to upgrade all of its Californian broadband systems to 300 Mbps download speeds by the end of next year, and it was supposed to convert all of its TV-only analog systems to full digital capability by last month. Those legacy analog systems were in lower income, rural communities in Modoc and Monterey counties, and the San Joaquin Valley.

California is the second state to confront Charter’s regulatory performance and upgrade claims. This past summer, the State of New York moved to revoke Charter’s permission to operate there, because of its “repeated failures to meet deadlines”, its “attempts to skirt obligations to serve rural communities, and its ”purposeful obfuscation of its performance and compliance obligations".

The PAO’s demand for accountability is necessary. Charter claims to be meeting its commitments, but confirmation is difficult. The CPUC also has obligations: it’s supposed to ensure that its directives are followed. Friday’s move to keep Charter honest is a welcome Christmas present for all Californians.

I assisted the City of Gonzales with its successful effort at the CPUC to force Charter to upgrade. I am not a disinterested commentator. Take it for what it’s worth.

CPUC should follow New York’s lead, hold Charter to obligations

by Steve Blum • , , ,

The California Public Utilities Commission imposed a long list of obligations on Charter Communications, when it granted permission for the purchase of Californian cable systems belonging to Time Warner and Bright House in 2016. Some of those requirements mirror the conditions that the New York Public Services Commission attached to its approval of the deal.

Unlike the NYPSC, however, the CPUC has not demanded public accountability from Charter. New York regulators nipped at Charter’s heels since the acquisition closed, and then revoked permission and ordered Charter to reverse the sale and give up its New York markets because “the company was not interested in being a good corporate citizen”.

Typically, the CPUC does not take an active role in enforcing conditions attached to telecoms deals. The job of being the cop on the beat is often left up to outside organisations. If you want a particularly vivid example of how that approach does or doesn’t work, take a look at the mess surrounding Frontier Communications’ purchase of Verizon’s wireline phone systems in California in 2016.

Although it’s arguably right to expect outside parties to take responsibility for enforcing their own contracts, there’s little reason to think they’ll take on the additional work of policing the CPUC’s own decisions. For example, when it approved the Time Warner purchase, the CPUC gave Charter two and a half years – until November 2018 – to convert its legacy TV-only analog systems to digital service…

Within 30 months of the closing of the Transaction, New Charter shall convert all households in its California service territory to an all-digital platform with download speeds of not less than 60 Mbps…

On December 31, 2016 and every year thereafter until December 31, 2019 New Charter shall submit a progress report to the Commission and [the CPUC’s office of ratepayer advocates] identifying progress made.

In theory, the CPUC has some idea already as to whether or not Charter is performing. It’ll be a relatively straight forward process to confirm that all of Charter’s analog systems in the San Joaquin Valley, and in Modoc and Monterey counties, have been upgraded to digital service come November. The CPUC should be as proactive in enforcing its own decisions and pursuing the public interest as its New York colleagues.

New York says Charter is “just lining its pockets”, revokes Time Warner purchase

by Steve Blum • , ,

The New York state public service commission started the process of unwinding Charter Communications’ purchase of Time Warner Cable systems, in a decision issued on 27 July 2018. The NYPSC says Charter is evading its responsibility to extend its infrastructure and upgrade its service, particularly in rural areas. Those obligations were imposed when the NYPSC gave its blessing to the acquisition.

According to the NYPSC, Charter’s sins include…

  • The company’s repeated failures to meet deadlines;
  • Charter’s attempts to skirt obligations to serve rural communities;
  • Unsafe practices in the field;
  • Its failure to fully commit to its obligations under the 2016 merger agreement; and
  • The company’s purposeful obfuscation of its performance and compliance obligations to the Commission and its customers.

These recurring failures led the Commission to the broader conclusion that the company was not interested in being a good corporate citizen and that the Commission could no longer in good faith and conscience allow it to operate in New York. Today’s actions are meant to address Charter’s failings and to ensure New York has a partner interested in the public good, not just lining its pockets.

Charter’s response was to call the NYPSC’s rhetoric “politically charged” – fake news, in other words. As you might expect, the company is challenging the ruling, and is demanding more details from the NYPSC. According to a story by Alan Breznick in Light Reading

In the company’s second-quarter earnings call…Charter Communications Inc. Chairman & CEO Tom Rutledge made it clear that Charter has no intention of obeying the state Public Service’s Commission order to exit the state because of its allegedly repeated failures to meet its cable buildout and broadband speed commitments. Instead, Rutledge said Charter will try to resolve the conflict with state regulators and, if necessary, will fight the PSC’s actions in court.

“Hopefully we can work it out,” Rutledge said in response to an analyst’s question on the call, noting that it will likely take some time. “But, if necessary, we’ll litigate. We believe we’re in the right.”

It’s just the beginning of the story. The end is months, if not years, away.

Charter’s franchise “should be revoked”, New York state says

by Steve Blum • , , ,

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.

Charter’s numbers don’t add up, so New York adds a $1 million fine

by Steve Blum • , , ,

Charter Communications is playing numbers games with its build out obligations and the State of New York’s Public Service Commission is blowing the whistle. Not just stopping the game, but also assessing a $1 million penalty.

As in California, conditions were attached to New York’s approval of Charter’s purchase of Time Warner Cable. Those obligations include “the extension of Charter’s network to pass an additional 145,000 homes and businesses across the State”. Charter has four years to complete that build out and must steadily complete 25% of the job each year.

In January, Charter reported mission accomplished for 2017. But the New York PSC went out and ground truthed Charter’s claims of new homes passed, and found the numbers were inflated. Of the 43,000 homes that Charter said it reached with the required “line extensions”, 12,000 were in New York City which, according to the PSC, was already 100% covered…

In addition to the fact that these addresses have pre-existing network already serving their locations, supported by the lack of pole applications associated with any of these passings…the Commission explicitly stated in the Approval Order that Charter’s buildout was required to occur in “less densely populated and/or line extension areas.” New York City is not such an area.

Even in those less densely populated areas, Charter padded its claims, according to the PSC…

Staff advises that many of these claimed newly completed passings actually consisted of cable and equipment upgrades to existing cable plant. In other words, Charter replaced older cabling and equipment on a pole with newer cabling and equipment, but the location had already been passed by the cable network, oftentimes having been originally passed with cable network for years.

So the PSC crossed another 2,000 homes off the list. As a result, Charter was 8,000 homes short of its 37,000 home obligation and got whacked with a $1 million fine. And faces the threat of losing its New York cable franchises completely if it blows it again. As you might expect, Charter begs to differ, calling the PSC’s conclusions “baseless and legally suspect” and promising to fight the order.

State of New York Public Service Commission, Order to Show Cause, Joint Petition of Charter Communications and Time Warner Cable, 19 March 2018.

Net neutrality is carefully tailored, FCC jurisdiction paramount says Charter

by Steve Blum • , ,

Master of disguise.

Proving the adage that it’s an ill wind that blows no good, Charter Communications is taking shelter behind the Federal Communications Commission’s decision to regulate broadband as a common carrier service. In a request submitted to a federal court in New York (h/t to the Hollywood Reporter), Charter argued that the New York attorney general shouldn’t be allowed to sue it in state court over consumer fraud allegations, because the FCC has preempted such matters when it issued its network neutrality order in 2015. The accusations mostly involve Time Warner Cable’s practices before Charter bought it last year.

It’s a legal question that turns on whether the New York attorney general is pursuing a garden variety consumer fraud case that just happens to involve Internet service or trying to regulate the broadband industry. In its filing, Charter has very kind words for common carrier rules…

Pursuant to the [federal communications act], all common carriers (including [Internet service] providers) “engaged in interstate or foreign communication by wire or radio” must employ “just and reasonable” “practices . . . in connection with [their] communication service,” and the FCC is statutorily charged with “prescrib[ing] such rules and regulations as may be necessary” to implement this requirement…

To implement “th[is] carefully tailored regulatory scheme,” the FCC “announce[d] [its] intention to exercise [its] preemption authority to preclude states from imposing obligations on [Internet service] that are inconsistent” with the FCC’s…(“[T]he [FCC’s] jurisdiction is paramount and conflicting state regulations must necessarily yield to the federal regulatory scheme.”).

Like Comcast, Cox and (formerly) Time Warner Cable, Charter isn’t one of the formal plaintiffs that are fighting the FCC’s decision in federal court, but it’s a member of the National Cable and Telecommunications Association, which is. Vehemently. Among other things, it accused the FCC of having improperly “arrogated to itself breathtaking authority”. Charter opposed the reclassification of broadband as a common carrier service, calling it “unnecessary and harmful”, among other things.

Charter, like other cable companies, frequently uses lobbying fronts, such as the NCTA, to fight its corner in regulatory and legal battles. It agreed to more or less abide by the FCC’s common carrier rules as a condition of its purchase of Time Warner Cable last year, but that shouldn’t be confused with agreeing with the FCC decision or, indeed, accepting its jurisdiction over broadband service at all.

Nor should its bald faced pleading before the federal court.