from the get-what-you-pay-for dept
Last year Trump Republicans killed a popular program that provided poor people with $30 off of their monthly broadband bill. The FCC’s Affordable Connectivity Program (ACP) had broad, bipartisan support, and more than 23 million Americans received the discount at its peak.
At the time, the GOP claimed they were simply looking to save money. The real reason, of course, was that the ACP was popular with their constituents (the majority of ACP participants were in red states) and they didn’t want Dems to use it as an election season issue. Follow up studies showed the program more than paid for itself via other benefits (like reduced health care costs).
When Republicans killed the program, it immediately resulted in millions of struggling Americans suddenly facing much higher broadband costs. This, in turn, resulted in a lot of folks ditching their broadband access entirely. At some major providers, like Charter (Spectrum), the impact was fairly significant.
Now Charter is facing a class action lawsuit by an investor who claims that Charter executives misrepresented the impact that the death of the ACP would cause the cable giant. The lawsuit claims that Charter CEO Christopher Winfrey and CFO Jessica Fischer made “materially false and misleading statements” downplaying the scope of the ACP-related losses:
“Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the impact of the ACP end was a material event the Company was unable to manage or promptly move beyond; (ii) the ACP end was actually having a sustaining impact on Internet customer declines and revenue; (iii) neither was the Company executing broader operations in a way that would compensate for, or overcome the impact, of theACP ending”
The Charter investor who filed the complaint (Mark Sandoval) isn’t much of one; he bought just two shares of Charter in April and 2 shares in May, then sold the shares on June 9. Charter has been bleeding cable broadband subscribers due to the popularity of 5G home Internet and modest improvements in fiber deployments (many from city utilities or municipalities).
Charter lost 140,000 cable broadband customers during the last quarter of last year. Last quarter Charter lost 117,000 broadband subs, which included roughly 50,000 ACP-related disconnections. Charter’s stock has been down up to 20 percent this year as investors respond to the losses. As per telecom tradition, Charter’s focus is primarily in greater consolidation via a proposed merger with Cox.
Like many telecoms, Charter is a heavy campaign contributor to Trumplican lawmakers who seem dedicated to making the entire sector worse by destroying functional corporate and consumer protection, gutting already modest programs aimed at helping the poor (and rural students), or rubber stamping terrible deals that make U.S. broadband less competitive and more expensive in the first place.
Filed Under: ACP, broadband, cable, fcc, high speed internet, lawsuit, low income, mark sandoval
Companies: charter
