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Spectrum Strikers Launch Website to Teach Consumers How to Cut Cable’s Cord

Phillip Dampier December 10, 2018 Charter Spectrum, Competition, Consumer News, Online Video, Video 2 Comments

A new union-sponsored website promises consumers they can find a better deal with a different video provider.

(Courtesy: Cut the Cord on Spectrum)

Many of the more than 1,800 Charter/Spectrum workers in the New York City area, on strike since early 2017, have teamed up in a new campaign to encourage customers to cut cable’s cord and disconnect service.

“We all know a typical cable/internet bill with Spectrum runs about $164 – 194 (can’t forget those equipment rental fees, DVR fees & random bill increases!),” the Cut the Cord on Spectrum website says. “By cutting the cord on Spectrum and signing up for streaming services – many of which offer Live TV options including all your favorite cable network and sports channels – you can cut your bill down to as low as $57.99/month!”

The website offers basic advice on alternative providers that stream video programming over the internet, including general pricing and included features. The website implies choosing any other provider is probably better than sticking with Spectrum.

“Spectrum customers – along with the N.Y. Attorney General’s office – have a long list of gripes with Spectrum Cable,” the site claims. “With an income over $490 million and CEO Tom Rutledge earning a salary of $98.5 million, it’s clear that Spectrum Cable is fleecing its customers, overcharging for horrible service while raking in huge profits.”

The International Brotherhood of Electrical Workers Local 3 is behind the latest digital effort to make life difficult for Charter Communications. The union plans to spend “tens of thousands of dollars” on online ads targeting zip codes where Spectrum provides cable service, according to union officials.

The union is getting significant support from politicians downstate, including New York Gov. Andrew Cuomo, who blasted Charter at a well-attended union rally in front of Charter’s headquarters on Wednesday in Manhattan.

“[Spectrum’s] CEO in 2016 made $100 million. The COO of Charter Spectrum, $50 million. The company made $15 billion,” Cuomo told the audience. “How dare you abuse the hardworking men and women that built that company and put the money in your pocket?”

The governor also continued his ongoing attack on NY1 – Spectrum News, a company-owned 24-hour news channel. Many union-supporting politicians have refused to appear on NY1, accusing the channel of bias.

“You want to know what’s interesting about their news organization? It has a very selective memory, their news organization,” Cuomo said. “You know what their news organization never covered? The fact that the state of New York is trying to take away their franchise and kick them out of New York. You know what their news organization failed to cover? The fact that 2,000 Local 3 members were kicked to the street and they’re rallying for two years for fairness and decency.”

Gov. Andrew Cuomo blasted Charter Spectrum at a rally held Wednesday in front of Spectrum’s corporate headquarters in New York City. (15:19)

 

Frontier Left Residents in N.Y.’s North Country Out of Service for 10 Days

A snowstorm, in winter, in Upstate New York, was the excuse Frontier Communications gave for leaving scores of residents in the Minerva-Johnsburg area without phone or internet service for as long as 10 days this month.

“We are aware of a service interruption in Minerva and have been delayed by a snowstorm that impeded access and diverted resources starting Friday,” Javier Mendoza, vice president of corporate communications and external affairs at Frontier, told The Sun.

The company routinely blames external factors for wide scale service interruptions, which often impact Frontier’s rural customers, totally reliant on aging copper wire infrastructure the company has refused to replace.

“Often [service outages] are due to uncontrollable circumstances like commercial power outages, severe weather, construction crews damaging telecom cables, cars hitting telephone poles or telecom equipment cabinets,” Mendoza said. “These causes can also delay response and restoral efforts beyond Frontier’s control.”

But customers in several states where Frontier provides the only internet access around are just as concerned by poor service that is within Frontier’s control.

Johnsburg’s town supervisor is one of them, complaining regularly about the poor quality of Frontier’s internet service, powered by DSL. It suffers frequent service outages.

Minerva-Johnsburg, N.Y.

“It’s been widespread throughout the town,” Supervisor Andrea Hogan told the newspaper. “People can’t run businesses with that.”

Those who rely on the internet to work from home are challenged by Frontier’s DSL service and frequent service problems.

Greg and Ellen Schaefer retired to the community of North River and planned to do part-time work remotely over the internet. They pay Frontier $228 a month for a package of satellite TV, landline, and internet service. On a good day, they achieve a maximum of 3 Mbps for downloads and 0.5 Mbps for uploads. But in Frontier country, where good days can be outnumbered by bad ones, the couple has often been forced into their car in search of good Wi-Fi. Some days they work from the local library, others they park by an AT&T cell tower near the base of Gore Mountain to use their car’s built-in AT&T hotspot.

Predictably, the Schaefers question the value for money they receive from Frontier Communications.

Frontier’s name conjures up the notion of a phone company providing service in the rough and rugged Old West, but Glenn Pearsall told The Sun he prefers to think of Frontier as an antique three-speed car, offering customers the choice of “dim, flickering,” or “off.”

Pearsall pays Frontier for internet speeds advertised at 6-10+ Mbps, but receives 0.69 Mbps for downloads and 0.08 Mbps for uploads at his home in Garnet Lake. A typical Microsoft Office software update takes approximately 48 hours to arrive, assuming one of many frequent service outages does not force the upgrade to start anew.

The problem for most Frontier DSL customers, especially in rural areas, is the distance between the company’s local exchange office and customers. The further away one lives, the slower the speed.

Many rural telephone exchanges have tens of thousands of feet in copper wire between the central office and an outlying customer. As a result, in the most rural areas, no internet service is available at all.

Frontier is accepting millions in Connect America Funds (CAF) — paid for by ordinary customers on their phone bill, to expand internet access into unserved areas. Frontier has to replace at least some of its copper wiring with fiber optics, which does not degrade significantly with distance. It can then reach customers part of the way over its existing copper facilities, which saves the company millions in replacement costs.

Demand for internet service and constantly rising traffic volumes suggests Frontier must regularly upgrade its equipment and backhaul connectivity. But in some areas, the company has failed to keep up with demand, resulting in online overcrowding. Customers that access the internet during peak usage times in the evenings report dramatic slowdowns and web pages that refuse to load — both symptoms of oversold network capacity.

Frontier is an integral part of New York Gov. Andrew Cuomo’s rural broadband initiative, which promises 99.9% of New Yorkers will have access to high-speed internet. The company collected $9.7 million in January 2018 to expand service to another 2,735 customers in the North Country, Southern Tier, and Finger Lakes region. The company claims it will deliver 100 Mbps internet speed to those customers in its news releases, but also warns what the company claims is never guaranteed.

“Our products state in our literature what you ‘may’ get. So it’s speeds ‘as fast as.’ You may not get 6 Mbps every moment of the day,” admitted Jan van de Carr, manager for community relations and government affairs.

It is that kind of mentality that has Pearsall keeping a bottle of champagne at the ready on the day he can disconnect Frontier service for good. But considering the alternative is likely to be satellite internet offered by Hughes, that bottle is likely to remain corked for a long time into the future.

N.Y. Gives Charter Spectrum Another Extension

New York’s Department of Public Service (DPS) has granted Charter Communications an unprecedented additional 18-day extension to file its threatened appeal of the Commission’s decision to boot the cable company from the state and its six-month exit plan.

“Charter and DPS Staff state in their request for a limited 18-day extension of time that discussions are ongoing, that Charter and DPS Staff have established a framework for how a settlement agreement might be structured, and that any final agreement would necessarily address: issues relating to the inclusion of certain categories of addresses and whether they are valid ‘passings’ under the Merger Approval Order; penalty actions and amounts under dispute in Supreme Court; and a schedule for compliance (including enforcement mechanisms) going forward,” the order granting the extension reads.

Despite last week’s filing from Charter’s attorneys excoriating the Public Service Commission for its decision to remove Spectrum from the state, the DPS claimed this week that because of Charter’s “continued obligations to comply with the Public Service Law and regulations, good cause exists […] to allow for further discussions while both sides reserve their respective legal rights.”

But some consumer groups, including Stop the Cap!, are wondering exactly when patience will run thin at the Commission.

“When the latest deadline arrives in January 2019, it will be nearly six months since the Commission voted to strip approval of Charter’s merger with Time Warner Cable,” said Phillip M. Dampier, founder of Stop the Cap! “While we can appreciate the benefits of negotiation and dialogue, these conversations are taking place behind closed doors with no public input and no formal ability for groups like ours to intervene and offer our own views.”

Stop the Cap! has advocated that Charter Communications be allowed to remain in business in New York, but only with their agreement to meet some additional terms and conditions:

  1. Further extend Spectrum service to additional customers in rural New York scheduled to receive satellite internet service;
  2. Increase entry-level broadband speed to at least 200 Mbps immediately and further extend availability of Everyday Low Price Internet service ($14.99/mo);
  3. Settle the ongoing labor dispute with striking Spectrum workers in downstate New York.

“At present, it appears the DPS/PSC is only negotiating to get Spectrum back in compliance with the original terms of the Merger Order they have been ignoring, which is hardly a concession,” Dampier said. “Charter’s arrogance and blatant disrespect for the terms of the merger deal and its flippant adherence to those terms should cost the company more than just a monetary fine lost in the state’s coffers. Visible benefits to New York consumers must be part of the equation.”

Dampier

The state seems mostly focused on keeping Charter in compliance with the agreement while the lawyers talk.

“As the Commission noted in prior extensions, however, this limited extension should not be viewed as an indefinite grant of time for discussions to continue between DPS Staff and the Company,” DPS officials wrote. “Many Upstate New Yorkers living in Charter’s franchise areas are understandably frustrated by the lack of modern communications infrastructure. The Compliance and Revocation Orders were designed to deal with very serious consumer issues presented by Charter’s conduct related to the company’s network expansion. As such, the processes envisioned therein must continue in the absence of an agreement.”

The current extension resets the deadlines to file an appeal to Dec. 14, 2018 and the six-month exit plan to Jan. 11, 2019. Both are just the latest in a series of extensions.

Important Dates:

  • July 27, 2018: The PSC votes to rescind approval of the Charter/Time Warner Cable merger in New York, effectively disallowing the company to continue to do business in the state.
  • August 17, 2018: Charter files a 60-day extension request, which is granted on Aug. 20.
  • September 7, 2018: Charter files a 30-day extension request, which is granted on Sept. 10.
  • October 9, 2018: Charter files a 60-day extension request. The DPS grants a 45-day extension instead on Oct. 10.
  • November 21, 2018: Department of Public Service (DPS) Staff and Charter filed a joint letter stating that they had not yet been able to reach a fully executed settlement agreement, but that they had established a framework for how a settlement agreement might be structured and that discussions remain ongoing. A limited 18-day extension is granted.
  • December 14, 2018: Deadline for Charter to file its appeal with the Commission.
  • January 11, 2019: Deadline for Charter to file a six-month exit plan showing the Commission how the company intends to orderly transfer its Spectrum cable operation to another provider.

Spectrum Complains Competitors Taking Advantage of Its Troubles in New York

“Charter Spectrum has been kicked out of the state of New York and has a 60 day transition period to allow those customers time to find a new provider,” a sales representative told a Charter customer in New York recently. “[She] would love to be the first to put together a proposal.”

That sales pitch was part of two exhibits offered by Charter Communications to back its claims it is being treated unfairly in New York because regulators have asked the company to make preparations to leave the state and competitors are taking full advantage.

“Although highly sophisticated entities familiar with regulatory litigation may understand that there will be legal proceedings regarding the Revocation Order and that it may ultimately never take effect, the potential for confusion among other current and prospective customers who lack such experience with the legal and regulatory process is significant,” company officials argued. “Charter’s competitors have already attempted to take advantage of the Revocation Order. For example, Verizon has already begun reaching out to several of Charter’s significant customers, including residential management companies in New York City. Verizon representatives have asserted that Charter will no longer be permitted to operate in New York State as a result of the Revocation Order, and have offered Verizon’s services as a substitute.”

Charter also claimed Verizon representatives were suggesting Charter was leaving the New York market and that customers had to (falsely) disconnect their Charter service.

“Such exploitation by Charter’s competitors is likely to increase and be amplified if Charter is required to file a public wind-down plan for exiting the state,” the company added.

Negotiations… Interrupted: Charter Spectrum Panics As Time Runs Out to File N.Y. Exit Plan

Charter Communications ‘productive negotiations’ with New York’s Public Service Commission have deteriorated.

On Monday, Charter Communications filed a Motion for Stay to block the regulator’s July order revoking Charter’s merger with Time Warner Cable and requiring the cable company to file an orderly exit plan with the state no later than Dec. 24.

“Discussions have, so far, not resulted in a settlement,” the company admitted in the legal filing.

Get Out of New York

Calling the order “draconian” and against the public interest, Charter all but accused the Commission of being petty for throwing the country’s second largest cable company out of the state over what it called “the Commission’s revisionist interpretation” of the agreement to expand cable broadband service to unserved parts of the state. It called the Commission unreasonable for not giving the company due process, setting an unreasonable deadline to formulate an exit from the state, and violating the company’s 1st Amendment rights.

“The Revocation Order imposes a draconian penalty on Charter’s New York operations, commanding Charter to undo a significant portion of a multi-billion dollar merger the Commission approved over two-and-a-half years ago and purporting to evict Charter from the State where Charter serves 3.1 million customers and has more than 11,000 employees,” the company’s lawyers argued. “To top it off, the Order, as extended, gives Charter only until December 24 to formulate an exit plan, and six months thereafter to accomplish the exit, timing that would (as the Commission knows) effectively insulate the Commission’s actions from any judicial review. The Commission’s actions reflect not reasoned decision-making directed to the public interest, but rather retaliation against Charter because Charter challenged the Commission by advocating for its good-faith reading of the expansion condition.”

“The Revocation Order is unprecedented in its scale and represents a unique and extremely unusual penalty that, to Charter’s knowledge, no other major cable or telecommunications provider has ever faced in New York,” the company added. “Merely developing an exit plan to meet the December 24, 2018 deadline would force Charter to divert significant resources from its business operations in order to explore what an exit plan might look like, if it is feasible at all. Already, business executives in various departments of Charter have had to take time away from overseeing the business in order to explain the impacts of the Revocation Order and expected impacts of any exit plan. Continuing to divert resources to such an effort, including the time of Charter’s management teams, will necessarily impact Charter’s ability to focus on its core operations.”

The 25-page attack on the Public Service Commission suggest negotiations have strained between the company and regulators, despite several deadline extensions and often-repeated claims from both sides that “productive negotiations” were underway. In a footnote, Charter attempts not to burn all of its bridges with the Commission, noting, “Charter is filing this petition to preserve its substantial and compelling legal rights. Nothing in this application is intended to foreclose the possibility of further discussions with the Commission to resolve this dispute without the need for judicial review.”

The company wants the Commission to stop the clock it imposed on Charter to get its affairs in order in preparation of leaving New York. It is requesting a stay that will drop the deadlines until the courts wrangle over what Charter is calling an “unprecedented and unlawful action.”

Scrambled Eggs

Charter argues the Commission has no right to insist on much of anything, because much of its business operation is unregulated and attempts to interfere with it would cause the company “clear and substantial irreparable harm,” and violate the company’s constitutional rights.

The harm from Charter’s actual departure from New York roughly seven months from now would itself be massive and irreparable, as there would be no way for Charter to restore its position by “re-entering” the State in a commercially reasonable way if Charter later prevailed on judicial review. The eggs here are scrambled—the merged companies’ national operations are fully integrated, and there is no obvious way to separate them. Any obligation to do so would require a massive commitment of time and resources—starting immediately—to navigate the complex business, legal, and regulatory requirements needed to implement the Commission’s order to unscramble the eggs. Moreover, the preparation of an exit plan would itself negatively impact Charter’s reputation with employees, customers, and suppliers in highly competitive markets and require Charter to expend substantial effort, resources, and money that could not be recovered if Charter ultimately prevails in challenging the Revocation Order.

The filing does not acknowledge that Charter was informed of the Commission’s decision in late July and that multiple deadlines have already been extended on the company’s behalf by regulators. Charter also does not mention there is a long history of cable companies separating, spinning off, selling, or trading parts of the business to other cable operators when business or regulatory conditions warrant. Several cable industry mergers have required spinoffs of certain cable properties which have been accomplished with little protest from the cable companies involved.

Charter also argues that the very idea New York’s PSC would demand the company leave the state is irreparably harming the company’s good reputation with its customers — a contention long in dispute with many of those customers and customer satisfaction surveys which have rated the company among the worst in the country. But that did not stop Charter’s attorneys from trying:

[…] The Revocation Order has negatively affected Charter’s reputation and goodwill, and will continue to do so unless stayed. The Revocation Order unfairly paints Charter as an irredeemable bad actor, and the Revocation Order’s unwarranted requirement that Charter exit the State within a matter of months has damaged Charter in the general public’s eye. Indeed, Charter’s goodwill was already harmed by the initial media attention the Revocation Order received, and this harm is likely to be exacerbated by the filing of an exit plan that will spur a second round of news stories and public speculation regarding the dispute.

Bad Faith

Charter claims the Commission changed the terms of the Merger Order after it was approved. In Charter’s view, the company’s expansion effort to reach unserved parts of New York State should include New York City, one of the most wired metropolitan areas in the United States. That the Commission took offense to Charter’s interpretation of the Merger Order should not mean the company should face the ultimate consequence — being asked to leave the state.

“The unprecedented revocation of the Commission’s approval of a merger that closed over two years ago is grossly disproportionate to any conduct at issue here,” Charter argues. “Although the parties dispute the meaning of the expansion condition in the merger order, the revocation of the merger approval serves no legitimate Commission interest when other remedies are available and when the Commission has no reason to doubt Charter’s readiness to comply with any authoritative judicial construction. Nor can the Commission’s unprecedented action be justified by any finding of “bad faith.” What the Commission inappropriately labels bad faith is simply Charter’s reasonable effort to challenge the Commission’s new interpretation, exhaust administrative remedies, and prepare its case for judicial review. There is no reasonable justification for the punishment the Commission imposed.”

Charter also takes issue with the way the Commission met and voted to throw the company out of New York, calling it “the paragon of procedural irregularity.”

“The Commission issued the ‘revocation’ penalty […] at a rump session of the Commission, without providing Charter with an opportunity to comment or present any argument on the availability of the remedy itself, or upon most of the grounds on which the penalty was predicated,” the company argued. “The Commission also denied the public—including Charter’s customer base, who would be required to switch to a new provider, and the local governments that are parties to Charter’s franchise agreements that the Order purports to vacate—an opportunity to comment on the unprecedented proposal to force Charter to exit New York.”

Charter Sets Its Own Deadline – Nov. 26

Charter expects the PSC to rule on its motion within a week of filing it, demanding a stay before the start of business on Monday, Nov. 26. If the company does not get what it wants, it will seek a stay from the Supreme Court in Albany County instead.

But the company also suggests the PSC is bluffing.

“The Commission is currently pursuing an action to enforce its interpretation of the Expansion Condition in the Supreme Court, suggesting that the Commission itself intends for the condition to remain in effect rather than for Charter to actually discontinue operations and leave the State,” the attorneys wrote. “And even if the Commission truly intended to revoke Charter’s merger approval and require it to leave New York, there is no reason the Commission needs Charter to do so—and to submit a plan to that effect—immediately, before Charter has had an opportunity to seek rehearing and obtain judicial review.”

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Recent Comments:

  • Dylan: Look at their prices. Absolutely ludicrous compared to many companies, especially Charter Spectrum. I pay $60 a month for 100/10 with unlimited data. ...
  • Paul Houle: For a long time communities have been frustrated in that they don't have any power to negotiate with cable companies. This town refused to enter into...
  • Ian S Littman: To be fair, you aren't wrong. Spectrum likely knows it won't have any competition for years in Lamar, so they'll quickly get take rates of >70% (re...
  • Ian S Littman: Are you in an area that can even get Spectrum service? Because in areas where they actually have to compete, they're actually pretty decent now. Yes,...
  • Ian S Littman: A more odd entry in that list is Chattanooga. The entire area has FTTH via EPB. Yet apparently folks can't swing the $57/mo starting price for 100 Mbp...
  • Ian S Littman: The issue here is that the NY PSC's threats have no teeth because, well, who will take over the cable systems if Spectrum is forced to sell? Either Al...
  • Bill Callahan: Phil, National Digital Inclusion Alliance just published interactive Census tract maps for the entire US based on the same ACS data. Two datapoints a...
  • Carl Moore: The idiots that run the cable companies must be also using drugs...a lot of people are cutting their cable services because of the higher rate and inc...
  • EJ: This will require a New Deal approach. Municipals need the ability to either be granted money or loaned money for broadband expansion. Until this is d...
  • Bob: I also got $1 increase for my 100/10 internet from Spectrum. A rep said it's for the speed increase that's coming in 2019. I complained that I was pro...
  • EJ: It makes sense to focus on wireless considering the government contract they have. The strange thing is they referenced fixed wireless in this article...
  • nick: Interesting how they conveniently leave out (Spectrum TV Choice) streaming service which is also $30/mo ($25/mo for the first 2 years)....

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