Low-Cost Broadband and Computers for Low-Income New Yorkers Sought in Charter Bid to Buy Time Warner by James, Brewer, Hoylman, Mosley, Kallos, and Wills

Public Advocate Letitia James, Manhattan Borough President Gale Brewer, State Senator Brad Hoylman, Assembly Member Walter Mosley, and Council Members Ben Kallos and Ruben Wills today called on the Public Service Commission (PSC) to ensure that any deal between Time Warner Cable and Charter Communication include expanded low-cost broadband, low cost computers, consumer protections, and free technology training for low-income New Yorkers. 

The PSC held a public hearing in New York City on September 21, 2015 in preparation of a vote on whether to approve the merger if it is in the “public interest.” The coalition of elected officials called for the following:

  • Provide low-income New Yorkers with “Connect2Compete” low-cost $9.95 a month broadband as well as computers, laptops and tablets for $250 or less, along with 700,000 free public Wi-Fi hotspots and training;
  • Maintain and improve $14.99 per month “Everyday Low Price” with at least 5 Mbps for all New Yorkers regardless of income and expansion for small business;
  • Provide $9.25 per month “Lifeline” discount to low-income phone customers coupled with “Connect2Compete” and commitment to provide “Lifeline” discount for broadband with FCC rollout;
  • Free broadband for New York City Housing Authority (NYCHA) and community centers as well as free Wi-Fi in all city parks, libraries and spanning the 700,000 public hotspots; and,
  • Invest in New York by bringing jobs, upgrading infrastructure, supporting NY1 and public access as well as improving customer service and protecting consumers.

“Across our City, there are job seekers sitting in coffee shops to send their resumes; children doing their homework on the stoops of libraries; and small businesses owners waiting for weeks, if not months, to get a broadband internet connection. In the 21st century, internet access is not a luxury, but a necessity. The Public Service Commission has the power to address these inequities, and must ensure that Charter Communications and Time Warner Cable do right by consumers. ,” said Public Advocate Letitia James.

“The proposed merger of Time Warner Cable and Charter warrants serious review at all levels of government. Although Charter has made some impressive initial commitments to protect net neutrality and provide improved services, further consolidation of the telecom marketplace is always cause for concern,” said Manhattan Borough President Gale A. Brewer. “In its review, the Public Service Commission must use its authority to push for broad consumer protections, affordable cable and broadband services, and improvements in customer service and infrastructure investment across the state. These issues must be thoroughly examined before any merger is approved.”

Senator Brad Hoylman said: "It is vitally important that New York City residents have access to affordable and reliable broadband services. As we move further into the 21st century, we must do all that we can to ensure that we are bridging the digital divide for all New Yorkers. I thank Public Advocate Letitia James, Borough President Gale Brewer, and Council Members Ben Kallos and Ruben Wills for making their voices heard on this important issue.”

“We’ve got a second bite at bridging the digital divide in the big apple,” said Council Member Ben Kallos, a software developer. “Finally achieving universal broadband is the responsibility of the government that regulates and provides exclusive franchises to cable companies who must in turn provide free and low-cost broadband, computers and training to low-income New Yorkers so we may bridge the digital divide. I am grateful that Charter has chosen to adopt ‘Connect2Compete’ to provide low-cost broadband, computers and training for free and reduced school lunch recipients to all low-income New Yorkers.”

“Broadband enables individuals, families, and small businesses to prosper by making the Internet and the unlimited amount of information it retains accessible to the public at an accelerated speed,” said Council Member Ruben Wills. An investment by Charter to increase people’s capacity to access the Internet, particularly that of our City’s seniors and youth, would serve both a public and commercial interest. In the City of New York, any multibillion dollar telecommunications franchise seeking approval to acquire one of its counterparts would be wise to demonstrate such a commitment, and I am hopeful that Charter will act with foresight in that regard.”

Council Member Kallos delivered an abbreviated version of this testimony at this afternoon’s PSC hearing at The Borough of Manhattan Community College.

Over the past year, the Public Service Commission (PSC) reviewed a proposed merger between Comcast and Time Warner Cable (TWC) to determine whether it was in the public interest.  During that period, the trio joined by other elected officials advocated on behalf of the City of New York, seeking the preservation of network neutrality, expansion of Lifeline eligibility to broadband, and other requests aimed at bridging the digital divide, while expressing overall concerns with anti-competitive elements of the proposed merger.

Following their comments on the Comcast-TWC merger the Federal Communications Commission (“FCC”) adopted net neutrality and Chairman Wheeler has called for life line eligibility for broadband. On a local level, Mayor Bill de Blasio has announced Link NYC which will provide free gigabit wireless internet using old payphones throughout the city of New York. On April 24, 2015, following reports that the Antitrust division of the United States Department of Justice was preparing to challenge the merger, Comcast announced that it had called off the merger. In the following month, on May 26, 2015, Charter Communications announced a $78.7 billion deal to acquire TWC, along with a $10.1 billion deal to acquire Bright House Networks. The new proposed Charter-TWC merger is before the Public Service Commission to vote on whether it is in the “public interest.”

Full Testimony Attached (PDF) and Below:

Over the past year, the Public Service Commission (PSC) reviewed a proposed merger between Comcast and Time Warner Cable (TWC) to determine whether it was in the public interest.  During that period, we advocated on behalf of the City of New York, seeking the preservation of network neutrality, expansion of Lifeline eligibility to broadband, and other requests aimed at bridging the digital divide, while expressing overall concerns with anti-competitive elements of the proposed merger.  Many initially thought the merger could not be stopped and if it was stopped, that we would never have another bite at universal broadband.

We have made progress this year in ensuring the democracy of the Internet as well as ensuring greater access.  As you are aware the Federal Communications Commission (FCC) adopted net neutrality and Chairman Wheeler called for Lifeline eligibility for broadband.  On a local level, Mayor Bill de Blasio announced Link NYC which will provide free gigabit wireless Internet using old payphones throughout the City of New York.  Now we have an opportunity to expand on these important gains.  On May 26, 2015, Charter Communications announced a $78.7 billion deal to acquire TWC.  With the submission of the Charter-TWC petition before your body, we continue where we left off and welcome another opportunity to see a deal involving TWC serve the public interest by providing free and affordable universal broadband.

Once again, we ask that the Public Service Commission ensure the proposed transaction promotes the public interest as mandated by statute. Access to reliable, high-speed, and affordable Internet is not a luxury, but a necessity in the 21st century. As New York City’s information and technology industry gains strength in research, development, and applications, it is imperative that our companies and research institutions can compete globally. The Mayor’s office estimates that approximately one in five (22%) New York City families do not have access to broadband at home, a number that jumps to more than one in three (36%) for families below the poverty line. This transaction is an opportunity to do better and should be used to guarantee universal broadband, consumer protections, and robust infrastructure commitments as a necessity to be in the “public interest.”

Maintain and Expand Access to Affordable and Quality Broadband Services

We ask that Charter preserve and expand affordable broadband programs currently offered by TWC and Bright House Networks to increase access to individuals, families, and businesses by:

  • The Bright House Networks’ “Connect2Compete” program must be made available to all Charter customers in New York City for an affordable rate of $9.95, must include free training and low-cost desktop, laptop, or tablet computers, must provide free access to the proposed network of 700,000 Wi-Fi hotspots, and must be expanded from free and reduced school lunch recipients to include low-income families and individuals who are eligible for the FCC’s Lifeline program.  Existing loopholes that deny services must be eliminated so that any eligible low-income customer can access services. The quality of these services must, at a minimum, be equal in speed and service quality to the least expensive Internet tier offered such as those customers receiving Time Warner Cable’s “Everyday Low Price” Internet services; and
  • Charter must commit to maintaining TWC’s status as an eligible telecommunications carrier (ETC) in order to provide Lifeline services for any phone services it plans to offer in the City of New York. On May 28, 2015,  FCC Chairman Wheeler, proposed that Lifeline be expanded to include broadband, and Charter, which has been initially supportive of the recommendation, must commit as part of this transaction to providing Lifeline services for broadband once it is expanded by the FCC.  In the interim, Charter must commit that any customer receiving the FCC Lifeline benefits for phone service bundled with Internet also be offered to participate in the aforementioned Connect2Compete program as outlined; and
  • Expanding Time Warner Cable’s “Everyday Low Price” affordable Internet tier, which currently provides 2 Mbps download speed and 1 Mbps upload speeds for $14.99 per month, to at least 5 Mbps and 1 Mbps upload speeds for $9.95/month. Minimum download and upload speeds should be pegged to the highest speeds available; and
  • Providing, at a discounted price, business Internet service equivalent to “Everyday Low Price” plan in speed and reliability; and
  • Removing connection fees anywhere in New York City that do not already have existing cable services.

Universal Broadband to Bridge the Digital Divide

We ask that Charter guarantee they will expand broadband and provide free access, training, and equipment to their broadband services for:

  • All public housing residents of the New York City Housing Authority, and establish training and access centers for every housing complex within the merged entity’s service area; and
  • All senior, youth, and community centers, as well as all homeless shelters, domestic violence shelters (with anonymous browsing capability), congregate care facilities, supportive housing facilities, and mental health group homes; and
  • Maintain and expand existing free Wi-Fi service in all New York City libraries, parks and on the backbone of the proposed 700,000 public Wi-Fi hotspots.

This build-out must be done in a timely manner. We seek to protect the City’s most vulnerable groups, as well as ensuring that all New Yorkers have fair access to Charter’s broadband services.

Improvements in Infrastructure, Jobs, Transparency, and Customer Service

As a company engaged in a $78.7 billion deal with substantial profit margins, Charter must commit to rapid infrastructure investment.  Charter must enhance services by taking the following measures to ensure that New Yorkers are provided with effective and reliable cable services:

  • Maintain or improve upon existing franchise commitments including NY1 and public access; and
  • Upgrade New York City’s Hybrid Fiber-Coax plant in Charter’s service areas to be provided at least gigabit network speeds, thus establishing New York City as a global leader in broadband access; and
  • Provide meaningful reductions in long wait times and narrow service windows by hiring more customer service staff in New York City; and
  • Establish an infrastructure development training fund to train New Yorkers for broadband/information technology construction and operations jobs; and
  • Prohibit coercive upselling of additional services during customer service calls; and
  • Add at least one additional customer service center in each borough and establish a Charter call center in New York state; and
  • Establish a service quality plan that has objective metrics that must be met, under penalty paid to customers. This is akin to the Verizon Performance Improvement Plan which mandates such minimum performance requirements; and
  • Improve transparency surrounding pricing increases and service changes; and
  • Commit to substantial reductions in the number of customer complaints as measured by the PSC.

These provisions are meaningless unless there is tough enforcement that holds Charter accountable. We ask that the Public Service Commission join the expanding coalition of businesses, advocates, and elected officials whose aim is to ensure this merger will be fair and beneficial to all New Yorkers. We request you adopt these considerations, present them to Charter during your negotiations, and formalize them in an agreement that is enforceable by the New York State Attorney General and the PSC.