Verizon, Cablevision and TWC face NY AG investigation over advertised Internet speeds

Verizon (NYSE: VZ), Cablevision (NYSE: CVC) and Time Warner Cable (NYSE: TWC) have become the subject of a New York Attorney General investigation over whether they charged consumers for speeds slower than what they advertised.

On Friday the AG sent letters to top management at each of the service providers asking them to provide his office with customer disclosures and any testing done to measure Internet speeds.

"New Yorkers deserve the Internet speeds they pay for. But, it turns out, many of us may be paying for one thing, and getting another," New York Attorney General Eric Schneiderman said in a statement.

Verizon told FierceTelecom in an e-mail that it will work with the AG and that an investigation will show it provides the speeds it advertises. 

"Verizon is confident in the robust and reliable Internet speeds it delivers to subscribers," said John Bonomo, a Verizon spokesman. "We look forward to working cooperatively with the Attorney General's office."

Cablevision said in a statement that it will provide any information the Attorney General wants, adding that its broadband speeds exceed what it advertises to customers. 

"Optimum Online consistently surpasses advertised broadband speeds, including in FCC and internal tests," Cablevision said in a statement. "We are happy to provide any necessary performance information to the Attorney General as we do to our customers."

A key focus of the AG's investigation is on interconnection agreements these providers sign with one another to exchange data across their networks.

Chief amongst the AG's concerns is that customers paying a premium price for higher speeds may be seeing service degradation due to a series of technical issues and business disagreements in their interconnection agreements.

According to a 2014 study by the Measurement Lab Consortium, or M-Lab, broadband customers' Internet service saw issues at points where their last mile providers connected with Internet transit providers like Cogent and Level 3.

Interconnection issues between ISPs and long-haul carriers have continued to rise in recent years, particularly as consumers have continued to use their broadband connections to access video services like Netflix (NASDAQ: NFLX) and Hulu.

Over the past year, Cogent and Level 3 have been making progress in establishing new interconnection agreements with large providers like AT&T (NYSE: T) and Verizon.

Cogent signed deals with AT&T, Verizon, and Time Warner Cable with the goal of improving traffic exchange efficiency by adding more capacity and interconnection locations. Likewise, Level 3 has been just as active, carving out deals with AT&T and Verizon.  

Interestingly, these agreements came not long after the FCC implemented its new net neutrality rules.

For more:
- Venturebeat via Reuters has this article

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This article was updated on Oct. 26 with additional information from Cablevision and Verizon.