GOP State Senator Calls Foul as New York Governor Ups Pressure on Charter

Before leading a pro-union chant at a rally last week, Cuomo said Charter lied to New Yorkers about expanding broadband (see 1812060029). The PSC plans a procedural vote Thursday to confirm extensions granted Nov. 23 by Chairman John Rhodes to allow more time for talks between Charter and the state about broadband commitments the state says the operator missed (see 1812100010). Charter separately faces a New York attorney general lawsuit about advertised versus actual internet speeds (see 1809250023).

“Gov. Cuomo is exploiting the current labor dispute,” said Ortt, GOP member of the state Senate Energy and Telecommunications Committee, which will shift control to Democrats in 2019 due to November's election results. “This provides him cover for the failures of his broadband program. The broadband program and the current union dispute should not be connected; however, it has become politically convenient for the governor to do so.” Ortt wants to hold Cuomo accountable for his broadband promises: “What is most concerning is that the governor and the PSC still have not laid out a clear and comprehensive transition plan for the residents who were scheduled to receive broadband from Charter. Should Charter be removed from the state, my fear is that these residents will be left without access.” Committee Chairman Joseph Griffo (R) and Ranking Member Kevin Parker (D) didn't comment.

“It’s clear to anyone familiar with the state’s broadband program that Charter’s failure to meet its commitments to provide access to high-speed internet throughout Upstate New York is unrelated to the workers’ strike against the company since early 2017," a Cuomo spokesperson emailed: "The Governor has consistently called on Charter to come to terms with the workers who make its business profitable. That doesn’t preclude him from joining with the" PSC and "Empire State Development in a public effort to push Charter to live up to ‎its commitment to New Yorkers to provide the broadband service they were promised." Charter declined comment.

Cuomo “seems to be using the labor dispute to put additional pressure on Charter to settle the other broadband dispute,” emailed Cornell University professor Aija Leiponen. “It’s an important policy goal for NY to have high-speed internet available everywhere in the large state. Broadband internet facilitates economic development and currently much of the state outside of large metro areas does not have reasonably fast internet access.” Charter agreed to speed broadband expansion, but it’s not profitable “to cover the vast rural areas … so it has dragged its feet in delivering,” the business professor said. After two years of slow progress, the state “decided that enough is enough and started to put more pressure on,” she said.

Heightened concern in New York about cable ISP practices and market concentration, and what they mean for internet access, is likely driving state action against Charter, said Syracuse University law professor Shubha Ghosh in an interview. Access concerns are especially strong in rural upstate, he said. Ghosh predicted a high-stakes, protracted legal battle: Charter is unlikely to fold, but “once New York state has gone down this route, it’s going to lose face if it suddenly gives up.”

Some see the dispute as emblematic of the state's regulatory style. “The regulatory environment in New York for telecommunications providers, whether wireless, wireline or cable, is excessive and impeding the delivery of critical broadband service to the public and standing in the way in the race towards 5G,” said Snyder & Snyder telecom attorney Robert Gaudioso, New York State Wireless Association vice president-advocacy. “Residents, businesses, emergency service providers and schoolchildren are disadvantaged as a consequence.” Cuomo's spokesperson responded, “If someone wants to make up excuses for why big corporations can’t live up to their promises, that’s on them, but we make no apologies for protecting consumers and holding them to their commitments."

Forcing Charter out of the state may be “counterproductive for both sides,” Ghosh said. Charter would lose a big market, while New York wouldn’t resolve access issues and could end up worse off, he said. Leiponen also doubts it will be kicked out because she said few national companies could even consider taking over the large network: “Any transition of asset ownership would be cumbersome and highly disruptive to local consumers and businesses.”

Charter and New York negotiators appear to be making some progress, “at least in terms of defining what the original agreement was about and how Charter’s progress towards meeting those commitments should be measured,” but forming a plan to fully meet the agreed deployment will be a “thornier issue,” Leiponen said. “The two parties are stuck with each other, mired in a lengthy legal dispute, and it will likely take years before [New York state] residents will actually see real progress in access to broadband internet."