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How can Spectrum, one of 'America's Most Hated Companies,' justify rate hikes?

Plenty of Spectrum customers are boiling mad about its latest rate hike.

The company will increase the cost of its TV Select and higher cable plans by $7.50 per month. Its broadcast TV surcharge – the price it charges customers to carry local broadcast stations – will increase by $1.51 per month. Cable box rental will increase 49 cents per month, per receiver. Customers with standard internet service who do not subscribe to a Spectrum TV Select (or higher) cable plan will see their rates rise by 6%, or $4 a month, to $69.99.

Digital Engagement Editor Qina Liu helped compile these questions from readers.

From Jason McCarville: How can they raise prices on a service they haven’t figured out how to properly provide consistently in the first place?

Christmann: You're not alone in being unhappy with Charter Spectrum's service. The company has an F rating and 14,227 customer complaints with the Better Business Bureau. It has been sued by the Federal Communications Commission, the New York State Attorney General and the State of Missouri. It has topped several "America's Most Hated Companies" lists, including financial website 24/7 Wall St.'s "Dirty Dozen."

Buffalo's internet speeds are also among the slowest in the country, ranking fifth from the bottom in a national analysis of 24 million internet users by technology firm Ookla. Spectrum says it provides 100-mbps service in Erie and Niagara counties, but Spectrum customers in Buffalo averaged download speeds closer to 30 mbps, according to scores from BroadbandNow, an internet data tracker.

So, how can they raise prices? Customers in Western New York have said they have to keep Spectrum because they feel it's their best or only option.

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From Fran Haefner: Spectrum said the rate hikes reflect the rising cost of local broadcast channels and cable programming over the past three years. Then exactly what is their justification for increasing the rate for internet-only customers? Corporate greed? Subsidizing the cost of TV programming on the backs of the internet users?

Christmann: This latest price hike affects cable and cable-related services, but Charter Spectrum spokesperson Lara Pritchard gave this reasoning for Internet price hikes:

"Our price reflects our investments in a better connectivity experience and improved network quality and reliability," she wrote in an email.

From 2014 to 2018, the company reports that it invested $32 billion in infrastructure and technology.

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From Rhiannon Alicia Raske: Whatever happened to this company supposedly being run out of New York State?

Christmann: In July 2018, the Public Service Commission ordered Charter Communications to sell off its Spectrum cable and TV operations in New York after it found the company had not held up its end of a deal to expand its broadband service in the state.

In April, they reached a compromise that allowed Spectrum to stay. As part of that settlement, Charter agreed to pay $12 million to expand service to communities in New York State that have little or no access to broadband internet.

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From Gregory A. Peterson: What happened to the rumor that New York State was tossing Spectrum because they refuse to deliver the product they claimed they could? What politicians are on Spectrum's payroll?

You might be referring to another, separate issue from the one that led to Spectrum's being ordered to leave. In December, Charter Spectrum agreed to pay a record $174.2 million settlement secured by the state Attorney General's Office, which said Spectrum promised high internet speeds it failed to deliver.

As for which politicians are "on Spectrum's payroll," Charter Communications has donated to both Democratic and Republican candidates, mostly through Political Action Committees, according to data from the Center for Responsive Politics, a nonpartisan research group. You can see a full list of them at OpenSecrets.org. Charter also spent about $9.4 million on political lobbying last year, according to the site.

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From David Robak: Besides FiOS, what do people use for internet? I got rid of cable TV a long time ago, but still think Spectrum for internet is my only option where I live.

From Jaclyn Miller: Anyone know of affordable internet around here?

Affordable alternatives, maybe. Fast, probably not.

Spectrum is the only widespread provider of broadband internet in Western New York. There's Verizon Fios, but it's only available in nine towns and has stopped expanding. Other than that, you've got DSL, cable modem, fixed wireless and satellite. Those options are much slower.

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From @mjlp716 on Twitter: When are we going to get a municipal internet/cable service? Why isn’t The News asking this question of our politicians?

Christmann: Erie County Executive Mark Poloncarz has proposed borrowing $20 million to lay 360 miles of fiber lines, which he said would bring every town in Erie County high-speed internet access. The Southern Tier Network is a similar government-owned fiber "backbone" in the Southern Tier.

 

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