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New York Orders Charter Out of State (arstechnica.com)
Yesterday, it was reported that Charter Communications could lose its license in New York because of its failure to meet merger-related broadband deployment commitments. Today, according to Ars Technica, the New York State Public Service Commission (PSC) voted to revoke its approval of Charter Communications' 2016 purchase of Time Warner Cable (TWC). "The PSC said it is ordering Charter to sell the former TWC system that it purchased in New York, and it's 'bring[ing] an enforcement action in State Supreme Court to seek additional penalties for Charter's past failures and ongoing non-compliance," reports Ars. From the report: Charter has repeatedly failed to meet deadlines for broadband expansions that were required in exchange for merger approval, state officials said. The PSC has steadily increased the pressure on Charter with fines and threats, but Charter never agreed to changes demanded by state officials. As a result of today's vote, "Charter is ordered to file within 60 days a plan with the Commission to ensure an orderly transition to a successor provider(s)," the PSC's announcement said. "During the transition process, Charter must continue to comply with all local franchises it holds in New York State and all obligations under the Public Service Law and the Commission regulations. Charter must ensure no interruption in service is experienced by customers, and, in the event that Charter does not do so, the Commission will take further steps, including seeking injunctive relief in Supreme Court in order to protect New York consumers." The five types of misconduct that the commission cited to support its decision 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.
SCOTUS tends to stay out of state matters such as this (single state, no opposing rulings in various circuit courts). State supreme court is probably as high as they can go. They could appeal to SCOTUS, but it's doubtful they would take the case.
I hate fat people.
I think it's likely that Charter really would sell the assets to a distinctly different cable company rather than a subsidiary created for the purpose of evading NY's order. It's entirely possible that those assets would be purchased by a company like Comcast or Cox, neither of which is much of an improvement over Charter. It's also possible that a company like Verizon might want into the cable business, something that's been discussed previously. I doubt that Verizon would be a significant improvement, either.
I'm in Lincoln, Nebraska, another formerly TWC market that's now controlled by Charter. It's clear that Charter is trying to cut costs dramatically due to the debt from purchasing TWC. We used to get OTA channels from Omaha, which is 50 miles away, but those have steadily been removed. There used to be a call center in Lincoln and they actually provided pretty good customer service. That's since been closed. It also used to be possible for existing customers to negotiate with TWC and get additional promotions to keep bills relatively low. The cable company still makes a profit even at those reduced rates except that Charter has to pay off a large amount of debt from purchasing TWC.
That's why selling off some assets might actually help Charter to some degree. Yes, it reduces their subscriber base, but it also provides an infusion of cash to pay off their debt from the purchase of TWC. The problem is that those markets will probably be acquired by Comcast, Cox, or a nearly equally evil outsider like Verizon.
They're required to sell the infrastructure to someone else. If they fail to do so in a timely manner, then eminent domain-style action will probably take place.