Charter Communications is preparing to lower its investments as the Federal Communications Commission is claiming the company is doing the opposite and attributing its newfound willingness to spend money on the Restoring Internet Freedom act aimed at repealing all net neutrality protections in the United States which was voted for in mid-December. Earlier this month, FCC Chief of Staff Matthew Berry took to Twitter to announce that the country’s second largest cable provider is upping the investments in its infrastructure and workforce as a direct consequence of the controversial move that undid the regulations put in place under the former Obama administration, as well as the corporate tax reform enacted by the U.S. Congress.
Charter’s consolidated financial report for the fourth quarter of 2017 and an earnings call that followed it in mid-January show a different story, revealing that the company’s capex increase came in 2017 while the net neutrality rules were still in place and its tax rates were notably higher. Additionally, Comcast is now preparing for what its own management is describing as a “meaningful decline” in infrastructural investments, suggesting the previous boost wasn’t directly related to the then-incoming repeal of the FCC’s regulations or the tax reform proposed by the Capitol Hill. Most industry watchers are arguing wireless carriers and broadband providers are making their investment plans based on a much broader range of factors than those on the FCC’s agenda and already had long-term plans in place before Chairman Ajit Pai proposed undoing the rules protecting the open Internet last year.
Charter’s capex amounted to $8.7 billion in 2017, up from $7.5 billion a year earlier, and is now set to drop regardless of the changes in the rulebook regulating Internet service providers, its latest financials reveal. Last Friday, the company announced it’s raising the minimum wage of its employees to at least $15 per hour and officially said the move was enabled by the FCC’s repeal of the Title II protections, as well as the tax reform which allowed it to continue its 2017 capital investment program meant to be completed in 2020. Its critics are still arguing that the company would never have started the initiative last year if its success was dependent on either of those factors, citing the planned decline in Charter’s overall 2018 spending as evidence to back such claims.