Charter-New York Dispute Could Hurt Masters, Agents

Office argument

New York State’s decision to revoke its approval of the 2016 merger of Charter Communications and Time Warner Cable, and bar Charter, doing business as Spectrum, from operating in the state, has prompted questions from the channel.

The New York State Public Service Commission (PSC) handed down the decision Friday. It determined that Charter failed to deliver the benefits to New Yorkers that were “at the core of the merger approval.”

The 2112 Group's Larry Walsh

The 2112 Group’s Larry Walsh

Charter was given 60 days to file a plan with the Commission to ensure what the governing body calls an “orderly transition to a successor provider(s).”

Larry Walsh, CEO and chief analyst of The 2112 Group, and Channel Partners’ Editorial Advisory Board member, said what’s taking place between New York and Charter is a “battle of wills.”

“The New York Public Service Commission fired a pretty big shot across the bow of Charter Communications because it failed to extend broadband internet service to rural residential and business customers,” he said. “This dispute will go to court and stay there long after the 60-day transition ordered by New York. I wouldn’t anticipate any changes in service to residential or commercial customers for the foreseeable future.”

However, the dispute will “sully” Spectrum and Charter’s reputation, and raise questions about its viability in New York, therefore making it harder for master agents and agents to sell Charter services, Walsh said.

Telarus' RIchard Murray

Telarus’ RIchard Murray

“Without knowing Spectrum’s arrangements in other states, the New York dispute could become contagious,” he said. “Other states with similar issues could use the tactic to pressure Spectrum to either accelerate infrastructure improvements or extract concessions for maintaining their operating licenses. I suspect Spectrum will survive this dispute with the State of New York, but it won’t end pretty. It will definitely leave a mark.”

Richard Murray, COO of Telarus, the master agent/distributor, said like other providers that have gone through this type of transaction, “Charter has encountered issues as a result of bringing multiple companies and systems together.”

“This particular issue in New York is a part of that,” he said. “While there are things to address, we’ve been encouraged by Charter’s recent willingness to work toward correcting issues of concern. We’ll certainly be keeping an eye on it, but we don’t anticipate immediate impact to our partners in the short term and are confident Charter will address the issues in New York for the long term.”

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