Charter Agrees to Pay $13M Fine to NY PSC

PSC says cable operator missed buildout deadline

Charter Communications has settled with the New York State Public Service Commission for its failure to meet a build-out requirement tied to its purchase of Time Warner Cable last year, to the tune of $13 million.

“The Commission conditioned its approval of the merger on Charter’s agreement to undertake several types of investments and other activities,” said PSC Interim CEO Gregg Sayre in a statement. “While Charter is delivering on many of them, it failed to expand the reach of its network to un-served and under-served communities and commercial customers in the time allotted.”

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Charter received approval from the PSC for the TWC purchase on Jan. 8, 2016, and agreed to a number of conditions, including delivering broadband speed upgrades to 100 Mbps statewide by the end of 2018 (300 Mbps by the end of 2019) and building out their network to pass an additional 145,000 un-served or under-served homes and businesses within four years of the closing of the transaction. While Charter has reported that it completed the first speed upgrade ahead of schedule, as of May 18 it had only extended its network to pass 15,164 of the 36,250 premises it was required to pass in the first year, according to the PSC.

Instead of a potential penalty for missing its build-out target, Charter agreed to pay $1 million in grants for equipment to provide computer and internet access to low-income users, and to set aside $12 million as a security to meet its network expansion commitment going forward. Under the settlement agreement, Charter will build-out 145,000 new passings in 21,646 increments over six periods through May 18, 2020. Charter has also agreed to develop a communications plan within 60 days of the settlement’s execution to inform New Yorkers whether they are part of the build-out plan.