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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.
wields a very heavy hammer. Frankly, I'm amazed that Charter would so flagrantly disregard them, as every other utility here takes PSC complaints VERY seriously. I guess this will keep the rest even more in line.
My first thought is what does ordering out of state mean? The fiber they own, the Right-a-ways they own, any contractual monoplies they own and existing service contracts they own are property with value. Will they be able to sell these assets? If not it's a seizure of private property. Perhaps they will be allowed to continue service providing just not solicit new bussiness? Perhaps they will be allowed to lease these to another service provider?
What I might guess is that they spin off a company called "not-Charter" and then sell or lease these assets to this wholly separate company. A holding company is created to hold both Charter and "not-charter" so one company now owns both companies (like Alphabet).
Municipalities might try to fit to edge into this but how? not-charter has a competitive advantage of the customer base and existing lines. Municipalities might try to lease the lines but then they are just leasing charter stuff. They could start building out their own but things like right-aways on poles and properties will be a difficult thicket. Witness how Google fiber got screwed out of space on poles and conduits because they were not a registered telecom or lacked monopoly grants.
Ironically the thicket of regulations that might seem like limits of cable companies are lobbied for by these companies to create entry barriers. THey like paying for rights of way because it denies others. There are often state wide laws that prohibit a municipality from competing with private enterprise. Municipalities are not allowed to favor one company over another by gifting them anything (anti-donation clauses to avoid graft).
Thus charter exits, and non-charter enters. The customer's ID number on their bills doesn't even change. The profits all go to the holding company and the same share holders as before.
Cuomo moves on to the senate, and then charter donates to the campaign for his replacement. three years from Now charter buys out "non-charter".
Some drink at the fountain of knowledge. Others just gargle.
FCC and the interstate commerce clause tells NY state to go fuck itself.
Neither has any bearing. Charter bought a legal entity that exists in New York State. They must comply with state law in the operations of that entity. They didn't. They lose.
The state spelled out exactly what Charter had to do in order to be allowed to purchase Time Warner. Charter agreed to the conditions. Now, Charter is being punished for not adhering to the specific details of the agreement (and for lying and saying that they had). The state tells them to GTFO and sell back the property, per their agreement
This is exactly how this should work, and good on New York for following through.