New York announced Friday that it is forcing cable and internet provider Charter Communications Inc., better known as Spectrum, to leave the state. The New York Public Service Commission accused Spectrum of failing to abide by the terms the state set when the provider merged with Time Warner Cable in 2016. The alleged infractions include skirting obligations to serve rural communities, repeatedly failing to meet deadlines, unsafe practices, and “purposeful obfuscation of its performance and compliance obligations.”
In a release, commission Chair John B. Rhodes said, “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.”
A particularly noteworthy allegation in the announcement is Spectrum’s apparent failure to expand its high-speed broadband network offerings to 145,000 homes and businesses in underserved areas with sparse populations, which was a condition of the 2016 merger. New York has had difficulty convincing providers to invest in infrastructure in rural parts of the state, because such companies often do not think that the revenue from these areas will make up for the high construction costs. Commission officials conducted an audit in March that found that the new deployments that Spectrum said would fulfill the terms of the 2016 merger actually covered areas in the state that the company was supposed have been serving prior to purchasing Time Warner.
Apart from banning Spectrum from New York, the commission is also fining the company $3 million. Before Spectrum goes, however, it will have to continue operating for 60 days so a replacement can step in. By leaving the state, Spectrum would also effectively have to sell off components of its New York operation. Responding to the news, a Spectrum spokesperson told ABC7, “In the weeks leading up to an election, rhetoric often becomes politically charged. 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.”
It’s unclear at the moment what Spectrum’s next move will be. The company provides internet, cable, and phone services to more than 2 million customers in New York. Over the past year, the company has repeatedly run afoul of both state officials and unions. Local Union 3 International Brotherhood of Electrical Workers in particular has fought with Spectrum over a number of issues, including retiree medical coverage and the use of local vendors. In 2017, approximately 1,800 union cable technicians went on strike when negotiations stalled. The union urged New York City not to renew the Spectrum franchise. New York City Mayor Bill deBlasio and New York state Gov. Andrew Cuomo, who is responsible for appointing officials to the Public Service Commission, have both expressed their support for the union.