Charter/TWC/BHN Conditions Sunset Fans, Foes Make Cases

Opponents said Charter's petition never shows it doesn't have the incentive and power now to restrict subscribers' access to competing video services, which was a danger the FCC identified when it set the settlement-free interconnection and data caps/usage-based pricing conditions in 2016. Public Knowledge and the Sports Fan Coalition said that fact the online video distribution market is growing is immaterial to Charter’s business structure and the competition it faces guarantee it will have the incentive to favor its own video services over competitors'. Data caps "are merely a form of price hike" and don't have a network management purpose, they said.

Charter's drive to adopt old TWC practices of data caps and access charges at interconnection would create scarcity that would let it charge more to customers and interconnecting parties, Incompas said. Charter has more market power than in 2016, and there's insufficient broadband competition to discipline it, it said. The group said the Charter's petition is shy on evidence and analysis showing the conditions are no longer needed.

The petition focuses on a few OVDs when the interconnection condition was about ensuring all edge providers, transit networks and internet users would be protected from ISP abuse at interconnection points, New America's Open Technology Institute said. Charter's reaching interconnection agreements with other big ISPs is immaterial and unanswered is whether its interconnection deals are fair, come from an abuse of its market power or lead to higher consumer costs, OTI said. It said TWC had a history of fostering congestion at interconnection ports to get interconnecting partners to pay new fees, and repealing the interconnection condition would let Charter "resume its Time Warner Cable predecessor’s 'game of chicken.'"

The acquirer hasn't shown the prohibition on data caps and usage-based pricing is no longer in the public interest, nor has it said whether and how it will implement data caps once the prohibition is lifted, the Massachusetts Attorney General said. Charter hasn't provided new economic analysis to show it has less anticompetitive incentive than when the FCC imposed the conditions, or shown that it not being able to impose data caps or charge interconnection payments hurt its ability to compete or serve customers, Newsmax said. Entertainment Studios Networks said the MVPD without conditions would have the ability and incentive to foil competition, and referenced ESN's ongoing litigation alleging racial discrimination in Charter not carrying its content (see 2006110011).

Data caps are a fair way to price the use of network resources, and could help the digital divide by letting lower-income users pay less for internet access, Information Technology and Innovation Foundation said in support. It argued for a free-market approach to paid interconnection. ITIF said the FCC should look at perhaps using administrative law judges rather than rulemaking to deal with interconnection talk breakdowns, and setting expectations on usage-based pricing and zero rating, and approving them as useful market-based tools could safeguard them from bans by a future administration.

The conditions "had little to no justification" when they were adopted, and accomplish nothing but forcing Charter into an unequal playing field while not benefiting edge providers or consumers, said the Innovation Economy Institute, Institute for Policy Innovation, Americans for Tax Reform, American Commitment, Less Government, Institute for Liberty, Center for Individual Freedom, Market Institute, National Taxpayers Union, TechFreedom, Taxpayers Protection Alliance, Digital Liberty and Citizens Against Government Waste. Free State Foundation said the conditions, if they ever were valid, "reflect general industry-wide matters rather than merger-specific concerns" and put Charter at a competitive disadvantage while depriving consumers of the benefits of its being able to devise different service offerings.

OVDs have had "explosive" growth since 2016, even as other major broadband providers aren't subject to similar restrictions, so there's no reason to keep them on Charter until 2023, the company said about calls with aides to Commissioners Brendan Carr and Mike O'Rielly and Wireline Bureau Chief Kris Monteith.

Charter got local business interest support from the likes of Rebuilding Together Central Alabama, Enterprise Florida, Ohio's Findlay-Hancock County Chamber of Commerce and Colorado's Grand Junction Area Chamber of Commerce. The company has been "a caring employer," with no layoffs during the pandemic and increasing its minimum wage to $20 an hour, said Colorado State Rep. Kim Ransom (R). The company lived up to its diversity commitments, the National Black Caucus of State Legislators said. Charter should be able to negotiate commercial arrangements with content providers to make sure infrastructure can handle the traffic, and those content companies are savvy enough to be able to navigate those talks with Charter, said Tony Mendoza, outside counsel to the Minnesota Cable Communications Association but not representing it in the filing.