Charter slashes network spending by $2B, but makes up for it by charging its customers more

When Trump FCC Chairman (and former telcoms executive) Ajit Pai murdered Net Neutrality, he told us the slaughter was necessary, otherwise the ISPs wouldn't invest in their networks.

A year later, Charter has joined Comcast in announcing major cuts to its capital expenditures budget, slashing spending from $8.9 billion under Net Neutrality to $7 billion under Net Discrimination, which allows the company to extort funds from online services on pain of having their data slowed down when Charter customers request it.

But Charter isn't done! They're also raising prices an average of $91/year/customer.

Charter calls this hike "promotional rate step-ups and modest rate adjustments," which is grifterspeak for "higher prices."

I am an extremely unhappy Charter customer in a monopoly Charter territory. The speed, reliability and price of my Charter service is uniformly terrible. If I had a choice, I'd take it.

Charter's plan to lower capital spending in 2019 conflicts with Federal Communications Commission Chairman Ajit Pai's claim that repealing net neutrality rules would cause ISPs to raise broadband capital spending. As net neutrality advocates have frequently said (and as ISPs have admitted to investors), broadband capital spending wasn't affected by the Obama-era net neutrality rules that were repealed by Pai.

Capital spending rises and falls based on business needs and technology upgrade cycles, such as the DOCSIS 3.1 rollout mentioned by Charter. Despite Pai's statements that net neutrality rules lowered investment, Charter raised its capital investment in 2017 while the rules were in place.

As we reported last week, Comcast's cable division spent $7.95 billion on capital expenditures during calendar year 2017, but that fell to $7.72 billion in the 12 months ending on December 31, 2018.