Universal Broadband and Consumer Protections Necessary for Public Interest in Time Warner-Comcast Merger Say James, Kallos

Digital Divide Would be Greatly Diminished by James/Kallos Proposal for Free and Low-Cost Internet for Millions of New Yorkers

Download the Letter in PDF

New York, NY– Public Advocate Letitia James, Council Member Ben Kallos and elected officials today called on the New York State Public Service Commission (PSC) to guarantee universal broadband and consumer protections in the prospective Comcast-Time Warner Cable Merger, which the PSC will approve or reject on November 13. The coalition of 22 state and local elected officials argued that for such a merger to be in the public interest, it would require key public benefits.

The merger of the two cable giants would provide Comcast with Time Warner Cable’s 2.5 million customers in New York State and 40 percent of Internet subscribers across the nation. The FCC has delayed a decision on the merger, but states such as New York State and California are conducting their own review processes.

The New York coalition demanded specific guaranteed public benefits for the Public Service Commission to consider the merger, including, but not limited to:

  • Universal broadband to bridge the digital divide, providing free wi-fi programs to NYCHA, senior, youth and community centers, and expanding affordable broadband services to all who qualify for means-based federal, state and city subsidies;
  • Improvements in infrastructure, transparency, and customer service to keep New York competitive and ensure residents have effective and reliable cable by reducing wait times, vastly improving service and reducing consumer complaints;
  • Increased transparency around interconnect transmission data to ensure compliance with Net Neutrality standards and a commitment to an Open Internet.

The standards were outlined in a letter sent to the Public Service Commission today, with a broad coalition including State Senator Kevin Parker, State Senator Jose Peralta, State Senator Brad Hoylman, Assembly Member Karim Camara, Assembly Member Walter Mosley, Manhattan Borough President Gale Brewer, Council Member Antonio Reynoso, Council Member Donovan Richards, Council Member Brad Lander, Council Member Stephen Levin, Council Member Deborah Rose, Council Member Paul Vallone, Council Member Mark Levine, Council Member Margaret Chin, Council Member Danny Dromm, Council Member I. Daneek Miller, Council Member Helen Rosenthal, Council Member James Van Bramer, Council Member Carlos Menchaca and Council Member Alan Maisel.

“We cannot allow New York to be left behind in the new economy. When one-third of NYC families don’t have access to high speed internet, we urgently need to invest in our high-speed internet infrastructure. We need our city to remain competitive in the 21st Century and for our economy to diversify with more technological companies setting up shop in New York. We demand that the PSC bridge the digital divide by delivering universal broadband as a necessary condition before the Comcast and Time Warner Cable merger,” said Public Advocate Letitia James.

“All New Yorkers must have access to a competitive, free and open Internet. Should these two cable giants merge, it is essential that New Yorkers have the customer protections and digital services they need,” said Council Member Ben Kallos. “This merger is only in the public interest if it greatly expands and does not diminish the opportunities our digital city has to offer.”

"The Public Service Commission needs to seriously evaluate the terms of this merger which could have long-lasting negative consequences for consumers across New York State. I'm grateful to Public Advocate James and Council Member Kallos for putting a spotlight on these issues and helping make sure that low income New Yorkers are at the table during this discussion," said State Senator Brad Hoylman.

“The New York State Public Service Commission has an obligation to reject any merger that is not in the public interest of New Yorkers. Any deal that does not promote broadband competition, guarantee net neutrality in perpetuity, and expressly prohibit paid prioritization agreements unequivocally fails that test. I urge the PSC to set an example for the rest of the nation and vote no on any deal that does not guarantee an open, innovative internet ecosystem for all,” said Manhattan Borough President Gale A. Brewer.

"Countless marginalized neighborhoods, schools, and centers of community life have gotten by for too long without access to the critical services that broadband internet provides. This significant transaction is an opportunity to address this inequality," said Progressive Caucus Co-Chairs, Council Members Antonio Reynoso and Donovan Richards. "We must not underestimate the business advantages this proposal creates but rather ensure that its impact includes additional resources for the progress of our constituency."

"Universal broadband would dramatically improve access to educational resources, job training and job postings, government services, and more for hundreds of thousands of New Yorkers," said Council Member Helen Rosenthal. "Today I call on the Public Service Commission to serve the public and recognize universal broadband as a fundamental resource for economic and educational opportunity in the 21st century."

“Facilitating the development of technology is a priority for New York City, but this work must be done responsibly and with accountability,” said Council Member I. Daneek Miller. “It is of utmost importance to our communities and the public interest that the Comcast-Time Warner merger provides a measure of expertise along with value to the citizens of our City. We expect these companies to demonstrate that they are good players by providing resources and access to those in need. This includes expanding affordable broadband services and improving technology infrastructure throughout the five boroughs.”

The letter available in PDF and below:

October 29, 2014

The Honorable Audrey Zibelman
Chair, New York State Public Service Commission
Empire State Plaza
Agency Building 3
Albany, NY 12253-1350

Dear Chairperson Zibelman:

The Public Service Commission (PSC) has a unique opportunity to bridge the digital divide by delivering universal broadband as a necessary condition to any potential merger between Comcast and Time Warner Cable (TWC). We believe the requirements discussed herein to be in the public interest of New York. In a merger valued at over $45 billion, Comcast seeks to acquire Time Warner Cable’s phone, broadband internet, cable and media assets that would reach 2.5 million customers in New York State. As you are aware, this merger would make the new Comcast the largest cable, broadband, and media content provider in New York.

Consequently, we ask that the Public Service Commission ensure that 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. For a nation that developed the internet, America ranks 14th in terms of fastest Internet connection speed and the World Economic Forum ranked the United States 35th out of 148 countries in Internet bandwidth. Our cable and Internet companies must invest more in the deployment of broadband. Due in part to anemic infrastructure investment, nearly one third of New York City families do not have access to broadband. We must do better.

The proposed merger would give Comcast overwhelming market power in the areas of access, content, and pricing to customers in New York. Comcast would have de facto monopolistic control. As such, a merger that does not guarantee universal broadband, consumer protections, and robust infrastructure commitments would not be in the “public interest”. After consultations with the business community, advocates, and academics we propose a series of recommendations that if mandated by the Public Service Commission would truly benefit communities and businesses across New York.

Universal Broadband to Bridge the Digital Divide

We ask that Comcast guarantee that they will expand broadband to 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;
  • All senior, youth, and community centers, and public parks. As well all homeless shelters, domestic violence shelters (with anonymous browsing capability), congregate care facilities, supportive housing facilities, mental health group homes; and
  • Establish free Wi-Fi service in all New York City Public Parks.

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

Maintain and Expand Access to Affordable and Quality Broadband Services

We ask that Comcast preserve and expand their affordable broadband programs to increase access to individuals, families, and businesses by:

  • Expanding their “Internet Essentials” program to include family and individual recipients of income-qualifying federal, state and city subsidies. The program should have inclusive means testing that will give access to more individuals and families. This means including those individuals that already qualify for the FCC’s Lifeline program while removing existing loopholes that deny services. The quality of these services must, at a minimum, be equal in speed, and picture and service quality to those customers receiving Time Warner Cable’s “Everyday Low Price” internet services;
  • Expanding Time Warner Cable’s “Everyday Low Price” 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. This is similar to the “New York Essentials” program proposed by the PSC staff but at a lower price;
  • Providing business Internet service equivalent to the “New York Essentials” plan in speed and reliability, at a discounted price, as well as up to 10 technology/small business incubator buildings per borough, as the City may select from time to time; and
  • Removing connection fees in areas that do not have existing cable services.

Improvements in Infrastructure, Jobs, Transparency, and Customer Service

As a $45 billion company with substantial profit margins, the future Comcast/TWC must commit to rapid infrastructure investment. Comcast must enhance services, and we ask that Comcast take the following measures to ensure that New Yorkers are provided with effective and reliable cable services:

  • Upgrade New York City’s Hybrid Fiber-Coax plant in the merged entity’s service areas to be provide at least gigabit network speeds, thus establishing New York City as a global leader in broadband access;
  • Guarantee from Comcast to an Open Internet and operate under Net Neutrality standards indefinitely;
  • Increase transparency around interconnect transmission data to ensure compliance with Net Neutrality standards; Provide meaningful reductions in long wait times and narrow service windows by hiring more customer service staff in New York;
  • Establish infrastructure development training fund to train New Yorkers for broadband/information technology construction and operations jobs;
  • Prohibit coercive upselling of additional services during customer service calls;
  • Add at least one additional customer service center in each borough and the establishment of a Comcast call center in New York state;
  • Establish a service quality plan that has objective metrics that must be met or a penalty would be paid to customers. This is akin to the Verizon Performance Improvement Plan which mandates such minimum performance requirements;
  • Increase transparency surrounding pricing increases and service changes; and
  • Commitment to substantial reductions in number of customer complaints as measured by the PSC.

These provisions are meaningless unless there are tough enforcement provisions that hold Comcast accountable. We ask that the Public Service Commission join the expanding coalition of businesses, advocates, and elected officials whose aim is to ensure this that merger will be fair and beneficial to all New Yorkers. We request you adopt these considerations and present them to Comcast during your negotiations.

Sincerely,

Letitia James
New York City Public Advocate

Ben Kallos
New York City Council Government Operations Chair

New York State Senators:
Brad Hoylman
Kevin Parker
Jose Peralta

New York State Assembly Members:
Karim Camara
Walter Mosley

Gale Brewer
Manhattan Borough President

New York City Council Progressive Members:
Margaret Chin
Danny Dromm
Brad Lander
Stephen Levin
Mark Levine
Carlos Menchaca
I. Daneek Miller
Antonio Reynoso
Donovan Richards
Deborah Rose
Helen Rosenthal
James Van Bramer

New York City Council Members:
Paul Vallone
Alan Maisel