PSC rescinds Charter - Time Warner merger approval

Marcus Newton
July 30, 2018

New York State not only has revoked its approval of the 2016 merger of Charter Communications and Time Warner Cable, it has barred Charter, doing business as Spectrum, from operating in the state. Unless overturned, this action will mean that Charter will no longer be permitted to operate in the state of NY.

"Since that time, however, not only has Charter's performance been wholly deficient and its behavior before the Commission contrary to the laws of NY state and regulations of the Commission, but it has also repeatedly claimed not to be bound by the terms of the Commission's approval".

Charter is the largest cable provider in the state.

Charter said in a statement that its Spectrum internet brand "has extended the reach of our advanced broadband network to more than 86,000 NY homes and businesses since our merger agreement" with the Public Service Commission, and is working to deliver broadband to more New Yorkers.

In addition to revoking their approval of the 2016 merger, NY has issued $3 million in fines and referred the case to the State Supreme Court. After more than a year of administrative enforcement efforts to bring Charter into compliance with the commission's merger order, the time has come for stronger actions to protect New Yorkers and the public interest.

PSC Chairman John Rhodes said Charter is "simply not serving New Yorkers". The cable company completed its $67 billion purchase of Time Warner Cable and Bright House Networks in May 2016.

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The commission invalidated more than 18,000 addresses Charter was counting toward the total number, with most of those being New York City addresses the commission says hardly count as "less-densely populated" areas. "But the fact is that Spectrum has extended the reach of our advanced broadband network to more than 86,000 NY homes and businesses since our merger agreement with the PSC".

On Friday, the commission escalated that battle by revoking its approval of the 2016 Charter-Time Warner Cable merger, which would prevent the company from operating in NY and will likely launch a prolonged court battle. In response to the decision by the commission, Charter noted that it had extended its reach to "more than 86,000 NY homes and businesses", which is objectively less than 145,000.

Missed targets for the build-out have resulted in two $1 million fines, which were taken out of a $12 million letter of credit submitted by Charter to cover commission fees, costs and fines.

A Charter spokesman did not respond to requests for further comment. Charter also must ensure that cable and internet customers' service is not interrupted during the transition. It provides digital cable television, broadband internet and VoIP telephone service to more than 2 million subscribers in NY in more than 1,150 communities, with a potential customer base of 5 million households in its franchise areas.

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.

Other reports by MaliBehiribAe

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