A federal appeals court has reversed an effort by the Federal Communications Commission to pre-empt state laws restricting municipal broadband expansion in Tennessee and North Carolina, ruling the FCC exceeded its authority by interfering with both states’ rights to define the boundaries where the community broadband networks can and cannot operate.

In a near-unanimous decision (with some minor dissent from one judge), judges from the Sixth Circuit Court of Appeals found the FCC exceeded their authority.

“The FCC order essentially serves to re-allocate decision-making power between the states and their municipalities,” the court ruled. “This is shown by the fact that no federal statute or FCC regulation requires the municipalities to expand or otherwise to act in contravention of the preempted state statutory provisions. This preemption by the FCC of the allocation of power between a state and its subdivisions requires at least a clear statement in the authorizing federal legislation. The FCC relies upon § 706 of the Telecommunications Act of 1996 for the authority to preempt in this case, but that statute falls far short of such a clear statement. The preemption order must accordingly be reversed.”

In other words, the court ruled that the FCC’s belief that Section 706 of the Telecommunications Act of 1996 allowed it to pre-empt state broadband laws goes too far. The judges opined Congress would have to rewrite the law to clearly state it was acceptable for the federal branch of government to overrule how a community or state decides to draw boundaries for public utilities.

EPB is the municipal utility in Chattanooga, Tenn.

The ruling will have an immediate impact on plans by municipal utility EPB in Chattanooga and city-owned provider Greenlight in Wilson, N.C., to expand service outside of their respective service areas. EPB has been working inside the Tennessee legislature to overturn or change the current broadband law but has been unsuccessful so far. Comcast and AT&T have lobbied the Tennessee legislature to keep municipal competitors from expanding, even where neither company offers service.

“Ultimately, Tennessee’s broadband gap is a problem for Tennesseans, and we need a Tennessee solution,” said David Wade, president of EPB. “We will continue to work with the growing number of state legislators and grassroots citizens interested in removing the barriers that prevent EPB and other municipal providers from serving our neighbors in surrounding areas who have little or no access to broadband. We are further encouraged by Commissioner Randy Boyd’s interest in addressing the lack of broadband in rural areas. As the head of the Tennessee Department of Economic and Community Development, he is especially well positioned to join with state lawmakers in addressing this challenge on behalf of Tennesseans.”

Greenlight announces gigabit service for Wilson, N.C.

North Carolina’s law was effectively drafted by Time Warner Cable, who shepherded the bill through the Republican-controlled state legislature, making huge political campaign contributions along the way, eventually winning enough votes to see the bill become law.

The ruling is a serious blow to FCC chairman Thomas Wheeler, who made municipal broadband expansion one of his active agenda items at the FCC. Wheeler believed the two state laws were not supposed to inhibit rural broadband expansion. Critics of the laws contend they were written and lobbied for by the same incumbent cable and phone companies that could eventually face competition from public broadband networks.

“Let’s be clear: industry-backed state laws to block municipal broadband only exist because pliant legislators are listening to their Big Cable and Big Telecom paymasters,” said Michael Copps, a former FCC commissioner. “This decision does not benefit our broadband nation.”

Wheeler

Wheeler tacitly agreed, saying today’s decision “appears to halt the promise of jobs, investment and opportunity that community broadband has provided in Tennessee and North Carolina.”

“[Since 2015], over 50 communities have taken steps to build their own bridges across the digital divide,” Wheeler said in written comments. “The efforts of communities wanting better broadband should not be thwarted by the political power of those who, by protecting their monopoly, have failed to deliver acceptable service at an acceptable price.”

The ruling can be appealed to the U.S. Supreme Court, and the FCC has an excellent chance of getting the high court to overturn today’s decision. Rulings issued by the Sixth Circuit were reversed by the Supreme Court 24 out of the 25 times they were reviewed in the five annual terms starting in October 2008 and ending in June 2013 — the highest number of any federal appellate court during that time period.

Broadband activists can also return to the two state legislatures and urge that the broadband laws be modified or repealed. Wheeler seems ready to join the fight.

“Should states seek to repeal their anti-competitive broadband statutes, I will be happy to testify on behalf of better broadband and consumer choice,” Wheeler said. “Should states seek to limit the right of people to act for better broadband, I will be happy to testify on behalf of consumer choice.”

WOW! Internet, Cable & Phone will unveil gigabit speed broadband across five U.S. cities by the end of this year.

In Evansville, Ind., and Auburn, Ala., WOW! will be the first provider in town delivering gigabit internet speeds to residents and businesses, with only a modem upgrade required to get faster service. In the wealthy community of Gross Pointe Shores, Mich., WOW! is bringing gigabit broadband over an expanding fiber to the home network. Customers in Knoxville, Tenn., and Huntsville, Ala. will also see faster speeds towards the end of this year.

WOW! provides competing cable service in 20 markets, primarily in the midwest and southeast, including Illinois, Michigan, Indiana, Ohio, Kansas, Maryland, Alabama, Tennessee, South Carolina, Florida and Georgia.

“In many of our markets, we are already offering the highest speeds available with our 600Mbps internet service,” said WOW! CEO Steven Cochran. “By enabling 1 Gig Internet over our existing coax plant and through our targeted fiber to the home investment, WOW! is demonstrating its commitment to continually innovate and deliver products that help our residential and business customers to connect.”

Maxx is dead.

Charter Communications executives told Wall Street analysts that Time Warner Cable’s upgrade program has been suspended, to be replaced with Charter’s own previously announced plan of upgrades and “simplified pricing” sometime in 2017.

Time Warner Cable was responsible for a lot of the capital expenditures underway at the combined Charter-TWC-Bright House venture just before the merger deal closed in May. Christopher L. Winfrey, Charter’s chief financial officer and executive vice president, told investors Time Warner was on a small spending binge, rushing in orders for new cable broadband technology to hurry Maxx upgrades to customers before Charter took over operations.

Winfrey eased Wall Street’s concerns about Time Warner Cable spending 21% of revenue on capital expenditures during the last quarter, promising the more modest upgrades forthcoming from Charter will allow for future spending reductions. More immediately, Winfrey reassured investors the days of Time Warner Cable’s aggressive Maxx upgrade effort was over.

“There is, obviously, the significant amount of all-digital activity that was continuing at TWC,” Winfrey told analysts. “And that will be largely put on hold as we put in the Charter all-digital strategy the beginning of next year.”

Charter plans to cancel upgrades that would have established multiple Time Warner Cable speed tiers ranging from 50-300Mbps. Instead, Charter will roll out two speed tiers to Time Warner Cable customers — 60Mbps for around $60 a month and 100Mbps for around $100 a month for broadband-only customers.

Rutledge

“In the fall, we will begin to rebrand Time Warner Cable and Bright House and launch our Spectrum pricing and packaging in a number of key markets totaling over 40% of our acquired passings with the remainder in the first half of 2017,” said Charter CEO Thomas Rutledge.

Customers in certain states — notably New York — will be able to keep their current Time Warner Cable package for several years. Customers in other states will be pushed harder to transition into Charter’s simplified tiers.

“In 2017, the all-digital project at Time Warner Cable and Bright House markets will use the Charter all-digital strategy, which uses fully functioning two-way set-top boxes with video on demand and advanced guide functionality on every TV outlet,” said Rutledge. “We expect the project to be completed by 2018. We will also extend our practice of performing electronic connections instead of physical truck rolls as we go all-digital, allowing us to fully scale our self-installation and self-service practices.”

Charter only advertises 60Mbps internet access to most customers on its website.

“Our plan is to have Spectrum Guide available in most Legacy Charter markets by the end of this year,” added Rutledge, referring to the on-screen channel guide. “We will launch Spectrum Guide in TWC’s larger markets by the middle of 2017 and other TWC and Bright House markets following through the year and likely continuing through 2018 as we complete the all-digital project.”

Rutledge was critical of Time Warner Cable and Bright House’s myriad of service tiers and prices.

“Through different metrics and stages of development, we can see that TWC and more recently, Bright House had both become reliant on rate increases and retention offers, each of which has various short and long-term effects including encouraging customers to initiate more transactions,” Rutledge said. “We’ve addressed these types of issues at Legacy Charter and we’ll do so at TWC and Bright House during the Spectrum pricing and packaging migration.”

That means Charter intends to dramatically cut the number of service and pricing options and convince customers to stop switching to promotional offers that they eventually abandon when the promotion ends. Charter prefers stable prices for services and reducing the amount of customer retention packages they have to offer to price-sensitive customers. As prices reset and increase, increased call volumes results as customers negotiate for a better deal. Removing the incentive to negotiate is seen as a cost saving maneuver and keeps customers on Charter’s regular price packages longer.

At least 81 Suddenlink employees are suddenly seeking new employment after parent company Altice USA disclosed their intention to lay the workers off as early as next month.

North Carolina’s Worker Adjustment and Retraining Notification Act requires businesses with at least 100 workers to give the state at least 60 days notice ahead of mass layoffs. Suddenlink’s call center in Greenville qualifies. Last month Suddenlink mentioned the call center would be closing, with jobs shifted into larger call centers elsewhere in the country.

Lisa Anselmo, a Suddenlink spokeswoman, claims some of the 81 workers have found jobs at other Suddenlink facilities, but would not specify how many.

At least 600 Cablevision employees will be out of a job by this November as parent company Altice USA continues to slash expenses to squeeze cost savings out of the cable business for the benefit of shareholders.

Altice announced this morning that the Cablevision call center in Shelton and a back office in Stratford, Conn., will be closed, with some jobs shifted to existing Altice USA call centers in New Jersey and Long Island, N.Y. The job cuts hit hard, with 50-100 employees being employed by Cablevision for more than 15 years, with some close to retiring.

“People have kids and everything like that to take care of at home. So, I’m sure it was sudden for a lot of them to hear this news.”

Employees said about 50 to 100 workers had been there over 15 years, some close to retiring.

“People have kids and everything like that to take care of at home,” an unnamed employee told WTNH-TV. “So, I’m sure it was sudden for a lot of them to hear this news. Some people are upset for sure.”

A spokesperson for Cablevision said employees will be given a severance package and can re-apply for an unspecified number of jobs in and out of the state.

“Over the last few years, there have been investments and enhancements to our Optimum products and services, making them more reliable and providing more customer service touch points than ever before,” the company said in a statement. “As a result, we have seen a significant improvement in customer call volume and patterns. As we look to strengthen our operations in the nation’s most competitive market, we are aligning our contact center organization to meet the current needs of our customers.”

Some employees speculate the real motive is saving money. An employee told WTNH that customer calls have slowed down, but Cablevision is also still hiring workers, presumably for less compensation.

“I don’t think it’s because of calls to be honest. They’re hiring a lot of people to work from home too,” the employee said.

Altice told New York and New Jersey regulators it wouldn’t lay off customer service employees for four years, but made no such agreement in Connecticut.