Charter Communications has been ordered by the New York State Public Service Commission to pay a $2 million dollar fine, and potentially face additional sanctions for missing committed deadlines to expand its broadband network in the state.
When the NY PSC approved the Charter-Time Warner Cable merger in the beginning of 2016, one of the conditions was that the operator would build out its broadband service to 145,000 unserved and underserved homes and businesses in New York within four years.
Charter submitted a buildout report in January, but the NY PSC disqualified 18,363 addresses the cable operator claimed it extended service to, after finding that they were already passed by Charter or another company, or that Charter was already required to pass the addresses as part of state regulations or franchise agreements. The more than 18,000 disqualified addresses included 12,467 in New York City and 4,096 in the cities of Buffalo, Rochester, Syracuse, Schenectady, Albany and Mt. Vernon.
Charter must remove the rejected addresses from its buildout plan and file a revised plan for going forward within 21 days.
This is the second time Charter has been fined in relation to not meeting the expansion deadline, with the NY PSC ordering the company to pay a $13 million fine in June 2017.
The latest $2 million fine stems from a settlement the NY PSC approved when it became clear that Charter failed to meet its 2017 target. Under that agreement, Charter was required to pass 36,771 eligible homes or businesses by December 2017 and meet regular six-month milestones or else pay up to $1 million for each miss and up to $1 million for any miss that was failed to be corrected within three months, which NY PSC said the cable operator failed to do based on the disqualified addresses.
“As a condition of our approval of Charter’s merger two years ago, we required Charter to make significant investments in its network,” said Commission Chair John B. Rhodes, in a statement. “Our investigation shows that Charter failed to meet its obligations to expand the reach of its network to unserved and underserved customers at the required pace and that it failed to justify why it wasn’t able to meet its obligations. Furthermore, since the company has taken the unfortunate position of refusing to adhere to all conditions set forth in our initial decision two years ago, we now demand the company unconditionally accept all of the conditions as the Commission unambiguously required in 2016, or run the risk of more severe consequences.”
Charter, for its part, said it continues to meet its merger commitments.
“Spectrum has expanded its network infrastructure to bring broadband to tens of thousands of residences and businesses in New York State; we exceeded our last commitment and we continue to meet our merger obligations,” Charter said in a statement.