Stall, stall, stall. While Charter Communications and AT&T are working towards improving their broadband service offerings for Kentucky’s largest city, both companies are doing everything possible to slow down the arrival of their nemesis: Google Fiber, which is preparing to wire Louisville for gigabit fiber to the home service.

This past February, Louisville Metro Council unanimously passed a new ordinance called “One Touch Make Ready,” designed to streamline telecom provider access to utility poles, which are getting crowded with at least three telecom companies vying for consumers’ business. The ordinance was passed with the support of Google, which seeks a minimum of red tape from local permit and zoning bureaucracies and its competitors while network engineers begin installing fiber optics across the city. Installing Google Fiber on utility poles may involve moving other providers’ wiring to make room for Google, which in some cases could mean 4-5 different utility companies having to visit each pole to move their wiring. In the past, Google asked the pole owner for access, which has not always been forthcoming on a timely basis. The new ordinance requires the pole owner to respond to access requests within 30 days. If no response is forthcoming, Google can approach the city for a permit to hire a contractor to do all the relocation work on their behalf.

“Such policies reduce cost, disruption, and delay, by allowing the work needed to prepare a utility pole for new fiber to be attached in as little as a single visit—which means more safety for drivers and the neighborhood,” Google wrote on its blog. “This work would be done by a team of contractors the pole owner itself has approved, instead of having multiple crews from multiple companies working on the same pole over weeks or months. One Touch Make Ready facilitates new network deployment by anyone—and that’s why groups representing communities and fiber builders support it, too.”

Louisville, Ky. (Image: Chris Watson)

About two weeks after the ordinance passed, AT&T made it clear they did not support it and took the city to court, claiming it had no right to regulate its utility poles.

“Louisville Metro Council’s recently passed ‘One Touch Make Ready’ Ordinance is invalid, as the city has no jurisdiction under federal or state law to regulate pole attachments,” said AT&T spokesman Joe Burgan. “We have filed an action to challenge the ordinance as unlawful. Google can attach to AT&T’s poles once it enters into AT&T’s standard Commercial Licensing Agreement, as it has in other cities. This lawsuit is not about Google. It’s about the Louisville Metro Council exceeding its authority.”

Time Warner Cable (now Charter Communications) joined AT&T, adding the city is violating the cable company’s corporate constitutional rights by effectively seizing their property (cable lines) and granting a right for third parties to manipulate, move, or manage those lines without Time Warner Cable’s permission.

“The ordinance is simply unworkable,” said Time Warner Cable’s attorney Gardner Gillespie, a partner in the D.C. law firm Sheppard-Mullin. “It does not provide any meaningful way for Time Warner Cable to know what changes have been made to its existing facilities or to assure any damage is promptly cured.”

Gillespie also claimed customers could endure poorer service and outages as a result of unauthorized contractors relocating Time Warner Cable’s equipment, often without the cable company’s knowledge.

City officials dismissed the concerns, but failed to get either lawsuit dismissed.

Charter executives have also opened a new opposition front against Google Fiber’s presence in the city, accusing city officials of unfairly favoring the search engine giant while continuing to burden Charter with a franchise agreement that requires the cable company to provide free cable in city buildings and offer channel space and studio facilities for the city’s Public, Educational, and Government Access channels.

At present, Google is not obligated to provide any of those services and has also won a unique regional franchise that covers the city of Louisville and nearby suburbs in a single agreement. The Metro Council has also granted Google its own public right-of-way access for installing various communications infrastructure. Both AT&T and Charter claim they are only getting involved because they believe they should be given equal treatment. Critics contend they are attempting to slow down Google Fiber, which could begin offering service by fall of 2017.

Time Warner Cable began offering Maxx-upgraded service in March 2016, offering residents up to 300Mbps. AT&T is gradually expanding its U-verse with GigaPower gigabit broadband service in locations around Louisville.

It is hard to imagine there are still cable systems serving customers with nothing more than a slim lineup of standard definition cable television channels in 2016, but not if you live in three Berkshire towns over the New York-Massachusetts border where Charter Communications will finally introduce HD television and internet service starting next week.

Lanesborough, West Stockbridge, and Hinsdale all suffer from the pervasive lack of broadband common across western Massachusetts. But these communities, along with Charter’s cable system in nearby Chatham, N.Y., are benefiting from regulator-mandated upgrades as a condition of approving Charter’s acquisition of Time Warner Cable. Charter Communications has almost no presence in New York, except for 14,000 customers in Plattsburgh and the seriously antiquated system in Chatham that isn’t too far from the dilapidated systems serving the Berkshires on the Massachusetts side of the border. Like in Chatham, customers in the Berkshires pay for service similar to what cable customers received in the 1980s – no video on demand, no internet access, and a capacity-strained system that lacks enough bandwidth to offer HD channels.

The upgrades will cost about $6,000 per customer — numbering 2,500 in Chatham and another 800 in the three towns in Massachusetts. Charter is paying the bill. Charter’s acquisition of Time Warner Cable will make things easier for the cable operator, because it will extend fiber connections between the Charter systems and existing Time Warner Cable infrastructure nearby.

In Massachusetts, Charter’s upgrades require customers to install new set-top boxes in time for the switchover on Aug. 2. A week later, on Aug. 9, internet access will be available at the two speeds Charter traditionally offers — 60 and 100Mbps.

Most customers care a lot less about improved cable television and are more concerned about getting broadband. Western Massachusetts’ broadband problems have affected property values and kept businesses from relocating or expanding in the area. Few areas in the northeast have languished with inadequate internet access more than Massachusetts communities west of Springfield.

The large consortium of 44 communities working under WiredWest have spent years working towards community-owned fiber to the home service in the western half of the state, but the project ran into political interference at the state government level. Lanesborough had been part of the WiredWest collaborative effort, reports iBerkshires. With Charter’s upgrade, the community may decide to drop out of the project, even though it would likely deliver superior broadband service over what Charter will offer.

Charter Communications is promising its Southern California customers it won’t bungle the transition from Time Warner Cable to Charter Communications like Frontier Communications did with former Verizon customers.

“We purchased all of Time Warner Cable and Bright House Networks. With this transaction we acquired everything,” company spokesman Justin Venech said. “We’re able to take more time in the integration process and not rush to make changes.”

Charter will take up to 18 months to make its presence fully known in areas formerly served by Time Warner Cable, and then primarily under its brand name known as Spectrum.

Time Warner Cable customers will be able to keep their current service and packages even after the transition, at least for a while.

But not all customers are happy about Charter’s slow transition plans. Customers waiting for Time Warner Cable Maxx upgrades, some already in progress, may be out of luck. Charter’s new management team put an indefinite hold on Time Warner’s more aggressive upgrade plans in favor of Charter’s much more modest commitment to offer customers two broadband speed tiers – 60 and 100Mbps over the next 18 months. Customers in the northeast and midwest have been told there are no longer any definitive dates for the introduction of Maxx, which offers free speed upgrades up to 300Mbps.

Almost all of Time Warner Cable’s executive management has been escorted out of the company’s Manhattan headquarters, severance pay and benefits in hand. In fact, Charter plans to abandon Time Warner Cable’s Manhattan headquarters altogether and shift top management to its plush Connecticut office. Most workers will be reassigned to other locations yet to be announced, some possibly upstate.

Charter has already begun repricing service and packages that will resemble Spectrum offerings, at least for new customers across Time Warner Cable and Bright House territories. The packages will not carry the Spectrum brand just yet, however.

Here’s the corporate memo the folks at Charter just sent employees at Time Warner Cable and Bright House Networks. If you’ve seen the movie 9 to 5 with Jane Fonda, Lily Tomlin, and Dolly Parton, let’s just say this is what the sequel would look like if Franklin Hart, Jr. escaped from the Amazon River natives that kidnapped him in Brazil and he reasserted his brand of autocracy in the office.

To summarize:

• Get back to the office. Your job is being relocated to a “designated Charter office location” wherever that is. Work-at-home is a thing of the past unless you can find an executive vice president to sign off (good luck with that).
• Wear your jeans at home, not around here. In fact, if you have any doubts about your ensemble, don’t show up at the office wearing it to find out.
• Summer Hours are so yesterday. Get over it. It’s Monday through Friday, not Friday when you decide to leave.

Sent to all employees at corporate office locations in Charlotte, St. Louis, Denver, Herndon, NYC and Stamford.

Charter will harmonize various work policies in the coming months, but I wanted to address specific employee questions regarding Charter’s practices at corporate locations. Here you will find immediate guidance on three areas:

Work Location:
Remote work locations: All Charter employees will be co-located with their work group at a designated Charter office location. We will work with you and your departmental leadership on potential relocation if necessary. In the interim, anyone who manages people should travel and be onsite where the majority of their employees report for work, for the duration of the work week.

Work from home: Charter does not have a work from home policy. If you have been or sometimes work from home and you are assigned to work functions in these corporate buildings you should immediately begin to report to your work location every day. If you have a concern regarding this you should speak to your manager. In the interim, anyone who manages people should travel and be onsite where the majority of their employees report for work, for the duration of the work week. Any formal work from home arrangement must be approved by an EVP and must have time bound criteria.

Workplace Dress Policy:
Whether we service internal or external customers, employees in Charter’s corporate functions are all professionals by trade and the expectation is we look the part. We will provide a harmonized workplace dress policy in the coming months, however unless approved by an EVP for a specific department and location, jeans are not deemed professional attire. In advance of the policy, if you are in doubt as to whether your attire is appropriate, better to not wear it. If you are still in doubt as to what is appropriate, please see your immediate manager.

“Summer Hours”:
We recognize that this practice at Legacy TWC was in exchange for working additional hours, earlier in the week. However, this is a benefit that is not extended to employees whom our departments serve, the same employees who generate our revenue and provide service to our customers. Perception matters, and a different standard for “Corporate” employees is not consistent with the values we want to project to the much larger employee base who work regular shifts during the day, nights and weekends. We will continue to be flexible with our employees as needs or special situations arise, but a broadly applied Summer Hours policy will not be in place within Charter.

If you should have any questions or concerns please discuss with your manager or let me know.

Paul Marchand
Executive Vice President and Chief Human Resources Officer

A condition imposed by the Federal Communications Commission requiring newly merged Charter-Time Warner Cable-Bright House to expand service into at least two million new homes already served by another cable or phone company already offering High Speed Internet is causing heartburn for smaller cable and phone companies that fear government-mandated competition in their service areas.

FCC chairman Thomas Wheeler has long believed that cable operators could compete against one another for customers, driving down prices for consumers while forcing service improvements. One of the conditions approving the Charter deal could have put Wheeler’s theory to the test, but not if Charter can help it.

Charter CEO Thomas Rutledge implied that he will continue to shield fellow cable operators from unwanted competition.

“When I talked to the FCC, I said I can’t overbuild another cable company, because then I could never buy it, because you always block those,” Rutledge said at last month’s MoffettNathanson Media & Communications Summit. “It’s really about overbuilding telephone companies.”

It seems unlikely Charter will ever directly overbuild one of its friends in the cable industry, especially important ones like Comcast, Cox, and Cablevision. Smaller independent cable companies don’t feel as secure, which is why the trade group that represents many of them, the American Cable Association, has tried to get the FCC to back off.

“The overbuild condition imposed by the FCC on Charter is stunningly bad and inexplicable government policy,” ACA president Matthew Polka said in a statement. “On the one hand, the FCC found that Charter will be too big and therefore it imposed a series of conditions to ensure it does not exercise any additional market power. At the same time, the FCC, out of the blue, is forcing Charter to get even bigger.”

The FCC probably crafted the deal conditions to force Charter to compete with other cable operators, because one million of those new customer locations must be where at least 25Mbps broadband service is already available. That protects many phone companies still offering DSL as an afterthought, because most don’t offer speeds anywhere close to 25Mbps. But the FCC left several counter-intuitive loopholes in the language that Republican FCC commissioner Ajit Pai says lends credibility to the ACA’s argument.

“Unless Charter chooses to exclusively overbuild areas served by Comcast, which I find highly unlikely, Charter’s increased broadband market share will come at the expense of smaller competitors,” Pai wrote in comments about the proposal.

Notably, Charter is allowed to buy up other small telecom companies and count up to 250,000 of their customers towards the one million new homes served requirement. If those are small rural cable companies, that means the FCC is allowing Charter to grow even larger instead of providing more competition. Charter could also choose to overbuild municipal broadband providers and co-ops, especially in areas next to existing Charter/TWC/Bright House systems. That would harm the FCC’s current interest in removing roadblocks to publicly owned broadband networks. Enthusiasm for such networks could be dampened if Charter is willing to wire the area at their own expense.

Rutledge’s announcement is sure to make life uncomfortable for a number of rural phone companies that have invested in fiber network upgrades and now face the potential of Charter taking away customers that are helping to pay off those upgrades.

An unintended consequence of the FCC’s various loopholes could place a heavy burden on independent telephone companies that invested in network upgrades for faster broadband even as wealthier and larger phone companies are protected from that competition by delivering frustratingly slow DSL.

One potential target for a Charter overbuild could be UniTel, headquartered in Unity, Maine. UniTel offers residential customers in Albion, Dixmont, Newburgh, Thorndike, Troy, and Unity broadband speeds up to 1 gigabit. Unity is located between Bangor and Portland — both served by Time Warner Cable (now Charter).

Phone companies like UniTel call the FCC’s mandate “artificial competition” that could put it and other rural independent phone companies into financial distress. UniTel has a speed edge over anything Charter plans to offer customers in the immediate future as it deploys fiber to the home service, but television is another matter. One of the benefits of being a large cable company is volume-discounted pricing for cable television networks. Smaller independent operators cannot compete when wholesale television programming discounts are calculated in, allowing larger companies to undercut smaller ones with lower pricing.

UniTel officials criticized the FCC for creating deal conditions that Charter will exploit to the detriment of improving rural broadband service.

“Rather than allow New Charter to unilaterally narrow the scope of the buildout condition to meet its own business objectives, UniTel respectfully urges that the Commission should act to narrow the scope of any buildout condition, not to meet the private business objectives of New Charter, but rather to meet the public policy objectives of universal service in rural areas,” the company argued in its filing with the FCC.

A handful of rural telecom associations generally agree with UniTel and want the FCC to retarget Charter’s buildout requirements to fixing the rural broadband problem by expanding into unserved service areas instead.