Charter and the New York State Department of Public Service have struck a tentative deal to keep Charter serving customers in the state, setting a new broadband buildout deadline of Sept. 30, 2021.
The agreement settles a dispute over buildout conditions imposed by the New York Public Service Commission (NYPSC) on Charter's purchase of Time Warner Cable. The commission is reviewing the agreement, according to Charter. It is neither an admission of any violation by Charter or a penalty.
Specifically, the agreement means:
• “Charter will continue to invest in network expansion to bring high speed broadband to tens of thousands of unserved and underserved residential and business addresses; including 145,000 addresses entirely in upstate New York.
• “[The] expansion will be completed by September 30, 2021, in accordance with a schedule providing frequent interim milestone requirements, with corresponding reporting and accountability, including processes and procedures to ensure proper oversight, and monitoring of progress by the Department and compliance by Charter.
• “It also will include Charter's agreement — over and above its undertaking at the time of its original entry into the atate — to spend $12 million for broadband expansion projects at locations to be selected by the Department and the Broadband Program Office.”
The department estimated that Charter will have to spend more than double its original estimation of the public benefit value of the expansion, and will mean high-speed to an additional 145,000 homes and businesses in upstate New York.
The Commission in July had said it was revoking its approval of the TWC deal, and thus Charter's ability to operate in TWC systems in the state, and required it to submit a six-month plan for turning over those Time Warner Cable systems in the state to another owner after Charter missed broadband buildout deadlines.
Charter sought and received extensions between then and now as it negotiated to remain in possession of the systems. The April 19 settlement also includes a request for another 90-day extension of that exit plan, which Charter hopes won't be needed — until Aug. 19, while the commission considers the deal, which would “resolve all outstanding disputes related to the July Orders and the underlying Network Expansion Condition contained in the January 8, 2016 Merger Approval Order.”
“Charter and the Department believe that this action is an important step forward in making high-speed broadband available to all New Yorkers,” Charter said in a statement. “It allows the parties to move forward with the critical work of expanding access to broadband, by resolving their disagreements without the need for costly litigation. As a result, Charter will invest even more money in New York State than originally planned, bringing the educational, economic and social benefits of high-speed broadband to areas where access is often limited.”
The network expansion condition at issue had required Charter to “expand the Company’s network to ‘pass’ an additional 145,000 ’unserved‘ (download speeds of 0-24.9 Megabits per second (Mbps) and ‘underserved’ (download speeds of 25-99.9 Mbps) residential and/or business units within less populated areas of New York (the Network Expansion Condition).”
The expansion was to have been achieved in phases. The state said Charter failed to build out the requisite 36,250 premises by May 18, 2017. The state and Charter reached a settlement for that underperformance, but then the state said Charter had failed to meet its buildout targets — the commission disallowed some of the addresses Charter said had been reached — though Charter told the commission it did not believe it had “disavowed” its commitments to the state.