Business ProfileforSpectrum

The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government’s allegations, which have not yet been proven.

On Feb. 1, 2017, New York Attorney General Eric T. Schneiderman announced a lawsuit against Charter Communications Inc. (“Charter”) and its subsidiary Spectrum Management Holdings, LLC, (f/k/a Time Warner Cable, Inc.,) (together, “Spectrum-TWC”) for allegedly conducting a deliberate scheme to defraud and mislead New Yorkers by promising internet service that they knew they could not deliver.

The complaint alleges that since January 2012 Spectrum-TWC’s marketing promised subscribers who signed up for its Internet service that they would get a "fast, reliable connection" to the Internet from anywhere in their home. But a 16-month investigation by the Attorney General’s office – which included reviewing internal corporate communications and hundreds of thousands of subscriber speed tests – found Spectrum-Time Warner subscribers were getting dramatically short-changed on both speed and reliability.

The suit alleges that subscribers’ wired internet speeds for the premium plan (100, 200, and 300 Mbps) were up to 70 percent slower than promised; WiFi speeds were even slower, with some subscribers getting speeds that were more than 80 percent slower than what they had paid for. As alleged in the complaint, Spectrum-TWC charged New Yorkers as much as $109.99 per month for premium plans could not achieve speeds promised in their slower plans. 

The AG’s investigation also found that Spectrum-TWC executives knew that the company’s hardware and network were incapable of achieving the speeds promised to subscribers, but nevertheless continued to make false representations about speed and reliability. The investigation further revealed that while Spectrum-TWC earned billions of dollars in profits from selling its high-margin Internet service to millions of New York subscribers, it repeatedly declined to make capital investments necessary to improve its network or provide subscribers with the necessary hardware.

As the complaint alleges, Spectrum-TWC continues to underserve their subscribers by failing to make the capital investments necessary to live up to their promised speeds. These investments would include substantially upgrading Spectrum-TWC’s network capability and replacing large numbers of deficient modems and wireless routers that subscribers currently pay Spectrum-TWC up to $10 per month to rent.

Spectrum-Time Warner Cable currently has approximately 2.5 million subscribers across New York State.

https://ag.ny.gov/press-release/ag-schneiderman-announces-lawsuit-against-spectrum-time-warner-cable-and-charter