Published: Mon, July 30, 2018
Markets | By Josh Butler

State revokes approval for Charter-TWC merger

State revokes approval for Charter-TWC merger

Further, the NY public service commission has slapped the cable giant with a not-so-whopping - at least not for Spectrum and Charter Communications - $3 million's worth of penalties.

Meanwhile, Charter must comply with all local franchises it holds in New York State and all obligations under Public Service Law and commission regulations.

Yesterday, July 27, the Commission on the public services of the state of NY (Public Service Commission - PSC) announced that the company Charter Communications, which owns Spectrum, henceforth it is forbidden to provide their services to residents of the Big Apple and around the state.

According to the Commission, the various "instances of misconduct" include: repeated failures to meet deadlines; attempts to skirt obligations to serve rural communities; unsafe practices in the field; failure to fully commit to its obligations under the merger agreement; and "purposeful obfuscation" of its performance and compliance obligations to the Commission and its customers.

The commission said the United States broadband provider failed to live up to its agreement as part of the merger to build internet access to an additional 145,000 households and businesses in rural areas of NY under-served by internet providers. "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".

Conditions of the 2016 merger included extending service availability to 145,000 underserved homes and businesses in less populated areas of the state within four years and upgrading network speeds to 100Mbps by the end of 2018 and 300 Mbps by late 2019.

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The PSC has ordered Charter to file a plan with the commission within 60 days to "ensure an orderly transition to a successor provider (s)".

Charter will undoubtedly do everything in its power to block this move, so don't expect Spectrum to suddenly vanish from NY in two months, but perhaps this will at least lead to some positive changes. The PSC will file the enforcement action Friday in State Supreme Court in Albany.

On Jan. 8, 2016, the PSC approved Charter's acquisition of Time Warner. The Commission has also referred a false advertising claim to the Attorney General after Spectrum missed every network expansion target but continued to advertise as if they were delivering fast speeds. It provides digital cable television, broadband internet and VoIP telephone service to more than 2 million subscribers.

It's unclear which company would step in to provide service for New Yorkers if Charter is forced to cease operations in the state.

"All New Yorkers deserve fast, reliable broadband, and Charter's merger commitments in New York were created to help bring that about". During the transition process, Charter must continue to comply with all local franchises it holds in NY state and all obligations under the Public Service Law and the commission regulations.

"In the weeks leading up to an election, rhetoric often becomes politically charged".

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