So not only has Charter's acquisition of Time Warner Cable and Bright House been relatively unpleasant and expensive for consumers, the company appears to have failed to meet merger conditions imposed on the deal by New York State. Charter has been fined $13 million by the New York State Department of Public Service for failing to meet broadband build out requirements imposed as part of its recent mega-merger.
In New York, Charter was required to do a number of things it would have likely done anyway, including:
• Deploy broadband speed upgrades to 100 mbps statewide by the end of 2018 and 300 mbps by the end of 2019
• Build out Charter’s network to pass an additional 145,000 unserved or under-served homes and businesses within four years of the closing of the transaction.
"The commission conditioned its approval of the merger on Charter’s agreement to undertake several types of investments and other activities," said Gregg Sayre, department interim CEO, in a statement (pdf). "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."
More specifically, the NY PSC says that as of May 18, 2017, Charter had only extended its network to pass 15,164 of the 36,250 premises it was required to pass in the first year. As a penalty, NY state says 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.
Like most telecom sector mergers, what Charter promised before the deal -- and what's been delivered since -- are notably different. Many of our regulars complain that customer service got significantly worse after the deal -- an impressive feat given that Charter already had some of the worst customer satisfaction and service scores of any company, in any industry, in America. In fact, Charter satisfaction rates notably lower than many government agencies, including the IRS.
Customers have also been annoyed by the fact that Charter has been
aggressively raising rates in most of its acquired territories, with many customers saying they're being forced to pay upwards of 40% more for the same service. Charter CEO Tom Rutledge, who at $98 million was the country's
highest paid CEO last year, insisted that these customers were simply "
mispriced" and Charter was simply "moving them in the right direction."