Redacted For Public Disclosure

BEFORE THE NEW YORK PUBLIC SERVICE COMMISSION

) Joint Petition of ) ) ALTICE N.V. ) ) and ) Case 15-M-0647 ) CABLEVISION SYSTEMS AND AFFILIATES ) ) For Approval of a Holding Company Level ) Transfer of Control of Cablevision Lightpath, Inc. ) Cablevision Cable Entities, and for ) Certain Financing Arrangements ) )

ALTICE USA 4th ANNUAL REPORT June 22, 2020

Chris Ortiz Counsel, Government Affairs Samantha Pardal-Jerez Manager, Government Affairs Altice USA, Inc. 1 Court Square Long Island City, NY 11101 Phone: 929-418-4544 Email: [email protected]

Maureen O. Helmer Ekin Senlet Barclay Damon, LLP 80 State Street Albany, NY 12207 Phone: 518-429-4220 Email: [email protected] Email: [email protected] Counsel for Altice USA Redacted For Public Disclosure

TABLE OF CONTENTS

BACKGROUND AND EXECUTIVE SUMMARY...... 2 ALTICE USA 4TH ANNUAL REPORT...... 3 1. NETWORK SPEED ENHANCEMENTS ...... 3 2. NETWORK EXPANSION ...... 3 3. LOW INCOME BROADBAND PROGRAM ...... 5 4. CUSTOMER FACING JOBS ...... 11 5. CUSTOMER SERVICE ...... 12 6. MISCELLANEOUS ...... 13 CONCLUSION ...... 14

Exhibit A: Confidential Line Extension I Exhibit B: Confidential Line Extension II Exhibit C: Confidential Low Income Broadband Population Exhibit D: Low Income Broadband Marketing Exhibit E: Confidential Employment BEFORE THE NEW YORK PUBLIC SERVICE COMMISSION

) Joint Petition of ) ) ALTICE N.V. ) ) and ) Case 15-M-0647 ) CABLEVISION SYSTEMS AND AFFILIATES ) ) For Approval of a Holding Company Level ) Transfer of Control of Cablevision Lightpath, Inc. ) and Cablevision Cable Entities, and for ) Certain Financing Arrangements ) )

ALTICE USA 4th ANNUAL REPORT

Altice USA, Inc. (“Altice USA” or the “Company”) respectfully submits this Fourth

Annual Report (the “Fourth Report”) in compliance with the New York Public Service

Commission (“Commission” or “PSC”) Ordering Clauses contained in Appendix A of the Merger

Order.1 In particular, this Report addresses the Conditions that remain in effect as of the date of

this filing or were completed since the submission of the Third Report:

1. Clause I.A Network Speed Enhancements 2. Clause I.B. 1, 2 Network Expansion 3. Clause II.B Low-Income Broadband 4. Clause IV.A.1,3 Customer Facing Jobs 5. Clause III.A.1 Customer Service 6. Clause V.A.1.a Network Resiliency / Outages2

1 Case 15-M-0647 - Joint Petition of Altice N.V. and Cablevision Systems Corporation and subsidiaries for Approval of a Holding Company Level Transfer of Control of Cablevision Lightpath, Inc. and Cablevision Cable Entities, and for Certain Financing Arrangements, Order Granting Joint Petition Subject to Conditions (Issued and Effective: June 15, 2016) (“Merger Order”). 2 Altice USA incorporates its prior Annual Report filings by reference. Conditions not discussed herein have been satisfied, as explained in those prior Annual Reports. 1 Redacted For Public Disclosure

BACKGROUND AND EXECUTIVE SUMMARY

Altice USA has fully complied with the Conditions as required under the Merger Order. Although not required by the Merger Order, we also take this opportunity to report on some of the Company’s efforts in response to the Coronavirus pandemic, including various measures to connect New Yorkers to broadband. Notable initiatives in the last twelve months include:  Speed Upgrade: We previously reported on the Company’s satisfaction of the Condition to upgrade top broadband speeds to 300 Mbps, and note herein productive engagement with Staff to validate the Company’s performance. While not required by the Merger Order, we note that every home passed in NYS has access to download speeds of 400 Mbps, with speeds of 1 Gbps available in certain markets.

 Network Expansion: The Company has continued to extend its network to requesting households and small businesses in satisfaction of the Condition; since Close, the Company has connected more than New Yorkers, with no customer contribution toward extension of the network in the public right of way.

 Broadband Adoption and Affordability, Including COVID-19 Response: For its low- income broadband program, the Company continued to refine its marketing, ease the purchase process, and engage community partners in order to connect the target population to broadband. As reported in the Company’s Third Annual Report, 40 community anchor institutions have been connected to download speeds of at least 100 Mbps at no cost. Beyond merger commitments, the Company continues to provide free service to schools, libraries, and community organizations. Altice USA also undertook multiple initiatives to connect New Yorkers to broadband in response to the pandemic, including free Altice Advantage Internet to new customer households with K-12 and/or college students and making its Wi-Fi network available to non-customers through June 30, 2020.

 Customer Service, New Equipment, Product Offerings: Since June 2019, the Company’s service quality metrics have been compliant with the Order. Beyond the merger commitments, the Altice One entertainment and connectivity platform is available throughout the NY footprint, and the Company also launched a mobile product at an attractive price point.

More detail is below.

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ALTICE USA 4th ANNUAL REPORT

1. Network Speed Enhancements

Merger Requirements3

The Merger Order required that the Company make investments to enhance its existing infrastructure in New York and offer all customers in its service territory broadband speeds of up to 300 Megabits per second (“Mbps”) by the end of 2017. 4

Condition Status

In its First Annual Report, Altice USA notified the Commission of completion of the required network upgrade to download speeds of 300 Mbps on October 5, 2016 – more than a year in advance of the year end 2017 requirement in the Merger Order.5 Staff verified the Company’s implementation of this required network speed enhancement. While the 300 Mbps tier remains available, the Company has deployed a residential offering of 400 Mbps, and 1 Gbps in certain markets offered over its Fiber-to-the-Home (FTTH) network, thereby exceeding the merger requirement and demonstrating Altice USA’s commitment to continued investment in broadband.

2. Network Expansion

A. Line Extension

Merger Requirements – Line Extension

Condition I.B.1 required the Company to absorb up to $5,000 per household unit or small business of the customer’s contribution-in-aid-of construction calculated under the requirements of Section 895.5 of the Commission’s rules (“CIAC”) for requests to extend its network in the

3 Certain subjects discussed in this filing pertain to non-jurisdictional products and services. Nothing in this document is intended as a waiver or concession of any of the Company’s rights to raise jurisdictional or other legal arguments. 4 For exceptions, see the Merger Ordering Clause I.A.2.a. 5See http://www.alticeusa.com/sites/default/files/pdf/ALTICE-USA-UNVEILS-FASTER-BROADBAND-SPEEDS- ACROSS-ENTIRE-OPTIMUM-FOOTPRINT.pdf 3 Redacted For Public Disclosure public right of way (“line extension”), up to a $2M cap over four years.6

Condition Status – Line Extension

Altice USA has complied with the Condition. The Company has reported quarterly on its network extensions to all requesting New York State residential households and small businesses (“NYS HHs”) to Department Staff. Since Closing, the Company has connected more than NYS households and small businesses without requiring customer contribution even where permissible under the Merger Conditions. Confidential Exhibit A is a list of locations connected from June 1, 2019 through May 31, 2020 in the format requested by Staff (street address and latitude/longitude, in excel format). Further, Confidential Exhibit

B is a chart summarizing all of the line extension data reported to the Commission since the

Third Annual Filing on June 21, 2019.

B. Barrier Island

Merger Requirements – Barrier Island

The Merger Order required that the Company make a good faith bid consistent with

Program guidelines for the New NY Broadband Program (previously, Broadband 4 All) funding with the Broadband Program Office (“BPO”) to provide broadband service to the Barrier Island

Communities of Oak Beach and Gilgo Beach, Long Island.7

Condition Status -- Barrier Island

The Company has complied with the Condition. In the First Report, the Company notified the Commission of its successful bid for funding from the New NY Broadband program to extend its network to Gilgo and Oak Beaches.

6 Section 895.5 prescribes a formula under which a cable television company may require potential customers to pay for a portion of extending the plant in the public right of way. 7 Merger Ordering Clause I.B.2. 4 Redacted For Public Disclosure

3. Low Income Broadband Program

Merger Requirements

The Merger Order8 requires that Altice USA offer a low-income broadband program

(“LIBB”), providing a minimum speed of 30 Mbps for $14.99 per month to eligible customers throughout the Company’s New York footprint, and to report on the status of its implementation annually. The LIBB Program is subject to criteria enumerated in the Merger Order, including: (1) the development of a pilot program within six months of close; (2) program availability footprint wide within fifteen months; (3) specified program eligibility requirements; and (4) specified enrollment targets. Among other criteria, the Merger Order specifies that eligibility for the LIBB program will include: (1) children eligible for the National School Lunch Program (“NSLP”); and

(2) senior citizens eligible for federal Supplemental Security Income (“SSI”). Applicants who have subscribed to Altice USA broadband products within the prior sixty (60) days and/or owe past due balances to the Company are ineligible.

Condition Status

The Company is in compliance with the Condition. In December 2016, Altice USA piloted the LIBB program and, in September 2017, fully launched the product throughout the Optimum service area. Both the pilot and the full launch were executed in compliance with required timelines in the Merger Order. The product was originally marketed and sold as Economy Internet, and provided eligible customers throughout the Optimum New York service area with download speeds of 30 Mbps and upload speeds of up to 3 Mbps for $14.99 per month, consistent with the

Condition.

8 Merger Ordering Clause II.B. This report provides a general update on the Low Income Broadband Program. Please note however that the Company anticipates filing a separate submission addressing its compliance with the Condition ahead of the timeframe for achieving the First Penetration Milestone set forth in Ordering Clause II.B.2. 5 Redacted For Public Disclosure

Since launch, the Company has taken measures to evolve its product offering and marketing tactics to drive adoption, including changing the name of the LIBB product to Altice

Advantage Internet and deploying a targeted direct mail marketing campaign to eligible households. The Company’s efforts continue to drive broadband adoption among the eligible population – with more than eligible New York households newly subscribing to Optimum broadband services as of April 30, 2020.

Eligible Population

As described in the Company’s Second Annual Filing, and as referenced in subsequent filings and discussions, Altice USA has leveraged the same data-modeling process used to inform its marketing strategy for other products and services to better understand which households in the

Optimum New York service area would likely qualify for the LIBB program. Recognizing that these figures are always a snapshot in time, the Company has periodically refreshed its analysis to capture demographic changes impacting the qualifying population (e.g., potentially-eligible customers moving in and out of the Company’s service area, changing income levels), and has done so again for this filing. Exhibit C shows the breakout of the eligible population at different points in time.

As of April 30, 2020, the refreshed data revealed a qualifying population of households, of which were existing Optimum broadband subscribers. These current subscribers included the more than households that became broadband customers as a result of tactics employed in promotion of Altice Advantage Internet since program inception and who still live in the service area. The remaining qualifying population of is the current focus of the Company’s efforts to promote Altice Advantage Internet. This targeted population of

includes approximately households that are former customers with past due balances, and does not account for households that subscribe to the Internet via other providers.

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Current Adoption

Over time, Altice USA’s efforts to promote Altice Advantage Internet have met the intent of the Condition, driving greatly expanded broadband adoption among households eligible for

LIBB. As of April 30, 2020, more than LIBB-eligible households in the Optimum service territory have been connected to an Altice broadband offering. This subscription reflects a steady increase over time – up from in April 2019 (per the Company’s Third Annual Report), and

in December 2019 (per the Company’s February 2020 LIBB update). Of these more than

eligible New York households, opted to subscribe to Altice Advantage Internet, while the more than remaining households selected other Optimum product packages that included broadband. The Altice Advantage Internet subscriber households include that subscribed during the Coronavirus pandemic between March 16 and April 30, 2020.

As discussed further below, Altice USA’s offer, beginning March 16, 2020, of free Altice

Advantage Internet for the duration of the academic year to new customer households with students in response to the Coronavirus pandemic effectively removed any remaining barriers to adoption – no monthly fee, deferment of outstanding balances, and elimination of the verification process. The offer was widely publicized as part of the Company’s Coronavirus response in the news and social media, and was also shared with key stakeholders – e.g., the NYC Department of

Education. Even with these barriers removed however, there was an increase of only in

Altice Advantage Internet adoption among qualifying households through April 30, 2020.

Program Enhancements

Altice USA continues to iterate and analyze its marketing, positioning and other go-to- market considerations to more effectively promote Altice Advantage Internet to the target population and reduce real or perceived barriers to adoption, as evidenced by the increased broadband adoption rate over time. This update will focus on tactics used since the Third Annual

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Report, including those noted in our February 2020 update (see Exhibit D for Altice Advantage

Internet marketing materials). The Company notes four significant initiatives undertaken over the past year:

 Low-Price Laptop Program: Recognizing that access to a computer could be a barrier to adoption, the Company partnered with Acer, an information and communications technology Company, to offer a $149.99 internet-ready, recertified Chromebook laptop for purchase to customers eligible for Altice Advantage Internet, as of April 2019. Marketing collateral, including the dedicated Altice Advantage Internet website, instructions to sales representatives and other assets have been updated to reflect this offer (as noted in Exhibit D). To date, customers have taken advantage of this offer.

 Free Laptop Giveaway for NYC Families: The Company implemented a giveaway in New York City to provide free recertified laptops to eligible households that signed up for Altice Advantage Internet in Optimum NYC stores. To launch this offer, the Company hosted two free events (July and September) that provided the opportunity for customers to visit Bronx or Brooklyn retail stores, show proof of NYC Public School enrollment and receive a free Acer laptop if they signed up for Altice Advantage Internet that same day. To promote the event, the Company sent more than pieces of direct mail and ran digital banners and Facebook marketing – all targeting the Altice Advantage Internet- eligible population. The giveaway events generated new Altice Advantage Internet subscribers. As a result, the Company decided to keep the free laptop giveaway offer open indefinitely while supplies lasted. Through April 2019, the Company continued sending direct mail to our NYC eligible households promoting the free laptop giveaway, along with the Bronx and Brooklyn retail stores advertising the giveaway offer with window clings and other collateral. Examples of the direct mail, in-store promotion and instructions to representatives can be found in Exhibit D. As of April 30, 2020, the free laptop giveaway has resulted Altice Advantage Internet subscribers, and has been placed on hiatus as a result of the Coronavirus pandemic. The Company has nevertheless launched other promotions in response to the pandemic (as discussed further herein).

 No Install Fee: Since inception, the Company has offered Altice Advantage Internet with a discounted installation fee of $30, spread over a period of three months ($10 per month, for each of three months) and no equipment fees. Starting February 1, 2020, the Company implemented a promotion through direct marketing to waive the installation fee. From the pilot launch through the beginning of the Coronavirus pandemic in mid-March, of Altice Advantage Internet subscribers.

Continuation of Effective Tactics

A description of other key marketing and engagement approaches employed since launch of the

LIBB program is provided below:

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Direct Mail The Company has used direct mail to reach eligible households – to both non-subscribers, as well as existing video-only customers. Each likely-eligible household regularly receives a marketing piece promoting Altice Advantage Internet, Messaging, creative elements, envelope and letter formats are updated on a regular basis.

Bypass of Eligibility Verification for Likely Eligible Prospects The Company continues to allow likely-eligible prospects to bypass its eligibility verification vendor,9 so that likely-eligible prospects can purchase Altice Advantage Internet in real time with an Altice USA Sales Representative via telephone. As a result, likely-eligible prospects are able to schedule their installation during the same interaction.

Expanded Eligibility to all Households with NYC Public School Students The Company continues to extend the eligibility requirements for Altice Advantage Internet to include any household with a child attending a New York City public school, aligning with the NYC Department of Education program that makes free school lunch available to all NYC public school students. In addition, the Company maintains a simplified application process for these households to only require proof that the household has a child currently enrolled in a NYC public school.

Digital Advertising and Paid Search The Company utilizes digital advertising,

so when likely eligible prospects in the Optimum service area search for relevant phrases on Google.com they are shown a link to AlticeAdvantageInternet.com.

Continued Community Partnerships The Company continues to partner with community-based organizations that directly serve the eligible population and continually to look for additional partners. These partners play an important role in the dissemination of information to eligible households – from distribution of flyers, to the inclusion of Altice Advantage Internet in organization newsletters and emails to social media to events. Notable partnerships include:

• PowerMyLearning: A national non-profit organization that provides refurbished computers and training to NYC students and families. Altice Advantage Internet is promoted to these families upon completion as they go home with their computers. • BronxWorks: A respected social service provider and settlement house that reaches more than 40,000 underserved Bronx residents each year. • Brooklyn Community Services: One of Brooklyn's oldest and largest non-profit organizations, with 25 locations in low-income communities across the borough, that serves more than 18,000 people every year.

9 As previously reported, Altice USA has used Solix, an experienced third-party vendor that executes similar industry programs, to screen and conditionally qualify households for LIBB. 9 Redacted For Public Disclosure

• Island Harvest: Long Island’s largest hunger relief organization promotes Altice Advantage Internet to eligible populations through their “Weekend Back Pack Program,” which provides meals on the weekends for children dependent on NSLP program, and the Senior Mobile Food Pantry, which regularly delivers food directly to individual clients who live in low-income neighborhoods or senior housing developments. Stakeholder Engagement The Company continues to engage community stakeholders to promote the availability of Altice Advantage Internet:

• Public Officials and Community Leaders: More than New York public officials and community-based organization leaders were provided with information about Altice Advantage Internet, including the availability of a low-cost – and in the case of NYC, free – laptops. • Schools: Consistent with its practice since inception of the LIBB program, the Company mailed materials promoting the availability of Altice Advantage Internet to key education stakeholders – principals, Parent Teacher Associations (PTAs) and guidance counselors – within more than NY schools at the start of the 2019 school year. • Events: To engage the eligible population, the Company has held various events in partnership with New York community organizations promoting the availability of Altice Advantage Internet and the importance of broadband adoption. Partnership events included community leaders speaking about the importance of Internet access and the Company’s donation of laptops to community computer labs. Examples of these events and participants include: . New Rochelle Boys and Girls Club (New Rochelle) with Mayor Noam Bramson and City Manager Charles Strome . Wyandanch Family Life Center (Wyandanch) with NY State Assembly Member Kimberly Jean-Pierre, Town of Babylon Deputy Supervisor Antonio Martinez, and Town Council Member DuWayne Gregory . Cornerstone Baptist Church (Brooklyn) with NY State Senator Kevin Parker Free Altice Advantage Internet Offer in response to Coronavirus Pandemic

Connectivity has been a priority of Altice USA during the Coronavirus pandemic, particularly the need to support remote learning. Although not a Condition of the Order, in response to the Coronavirus emergency, Altice USA offered its Altice Advantage Internet product to new customer households with K-12 and/or college students for free – regardless of whether or not they fell within the LIBB qualifying population. As the pandemic expanded, the Company extended the free service period, initially 60 days, through June 30, 2020 to coincide with the end 10 Redacted For Public Disclosure of the school year. The Company widely marketed the availability of this service - making targeted outreach to community organizations and schools, including holding several conversations and sharing materials with the NYC Department of Education, elected officials and other key stakeholders. Additionally, the Company waived the verification process and allowed customers to sign up in real-time online, via email or by calling a designated number, and temporarily deferred unpaid balances to allow households that were previously ineligible for service to be connected.

Between March 16 and April 30, nearly New York households accepted this offer and subscribed to Altice Advantage Internet – including households eligible for LIBB and

households outside the qualifying population. After June 30, 2020, any customer that subscribed to Altice Advantage Internet during the free period will be able to maintain the service for $14.99/month beginning with their July bill or can cancel the service before June 30, 2020 to avoid any charges. The Company will continue to defer unpaid balances as long as the customers remain in good standing.

Other measures implemented by the Company to ensure connectivity for New Yorkers during the pandemic are discussed further herein.

4. Customer Facing Jobs

Merger Requirements

The Merger Order provides that for four years from the issuance of the Order, the

Company is prohibited from laying off, or taking any action effecting an involuntary reduction in workforce of customer-facing jobs in New York State.10

10 Merger Ordering Clause IV.A.1. “Customer-facing jobs” is defined to mean those positions with direct interaction with customers, including, but not limited to call center and other walk-in center jobs, and service technicians. 11 Redacted For Public Disclosure

Condition Status

The Company has complied with the customer facing jobs condition.11 The difference in customer facing jobs from the positions reported in the Third Annual filing (5/31/19), and the roles a year later is due primarily to employees voluntarily leaving the Company and/or individual employees pursuing a non-customer facing role within the Company.

The 2020 customer facing employee data in Exhibit E demonstrate that the decline in customer facing employees is largely the result of voluntary decisions by these employees;

of the reduction was due to voluntary departures from the Company and approximately

of the reduction represents individuals who remain employed by Altice USA, but who voluntarily decided to take other (non-customer facing) roles. These voluntary departures include employees electing to participate in voluntary retirement programs offered to field service employees between July and December 2019, and again during the Coronavirus pandemic (to address concerns among field service employees in roles requiring public interaction). The remainder of the reduction was attributable to employee performance management.

As referenced in Exhibit E, the Company added individuals to its customer facing workforce, both through hiring and by offering employees in other departments the ability to choose customer facing roles.

5. Customer Service

Merger Requirements

The Merger Order requires that for four years, the Company is to maintain a rate of service and repair calls per customer that is within ten percent (10%) of the average rate Cablevision met in 2015 and resolve ninety percent (90%) of trouble calls within two (2) days.12

11 “Customer facing jobs” do not include positions within News 12, consistent with prior filings. 12 As reported 12 Redacted For Public Disclosure

Condition Status

The Company has been in compliance with the service quality metrics in the Merger Order

(Repair and Service Calls/Customer and Trouble Calls resolved in two days) since the Third

Annual Report.

6. Miscellaneous

A. Coronavirus Response

Though unrelated to the Merger Conditions, we note herein Company measures to connect

New Yorkers to broadband and otherwise support residents, businesses and communities during the Coronavirus pandemic. Since the Governor’s statewide Disaster Emergency Declaration in

March 2020,13 Altice USA has implemented various initiatives and been in frequent communication with Staff and other State officials. Of note, the Company is a signatory to the

FCC's “Keep Americans Connected Pledge,” and extended this commitment beyond its original expiration date to June 30, 2020. Further, Altice USA has offered free broadband options designed to facilitate online learning, as well as news and other content. These measures include:

• Free Altice Advantage Offer: The Company offered its Altice Advantage Internet product to new households with K-12 and/or college students for free. Customers with outstanding balances were also permitted to take advantage of the offer, with temporary deferral of their former balances.

• Free Student Wi-Fi Offer: The Company partnered with school districts to offer a Student Wi-Fi product at no cost until the end of the 2019-20 school year. The program provides students who have school-issued devices the ability to use the Optimum Wi-Fi Hot Spot Network to access their school’s network and resources from home if they do not have dedicated Internet access. More than NY school districts have taken advantage of this offer with approx. registered student devices.

• Other Measures to Facilitate Connectivity: The Company has opened its Wi-Fi hotspots to non-subscribers; (2) released free previews of select programming networks, with live and On-Demand content which has been extended through June 30; and (3) made News12.com available to all to ensure residents have access to local news, including school closures and

13 New York State Emergency Order 202, dated March 7, 2020. 13 Redacted For Public Disclosure

local government press conferences.

The Company also continues to support the recovery efforts of small and medium-sized business customers across its footprint, Feeding America, and the Boys & Girls Club of America with its

Community Relief Programs, as well as provide free airtime for public service announcements by health and community organizations and government officials.

CONCLUSION

The Company remains focused on compliance with the Conditions still in effect as of the date of this Fourth Report. Beyond the Merger Order, the Company remains committed to offering innovative, customer-focused products and services to New York residents and businesses over robust networks and to supporting its communities. Altice USA appreciates the professionalism, diligence and responsiveness of Commission leadership and Staff in overseeing the Merger Order, and looks forward to further productive collaboration with

Commission and Staff with regard to the remaining active Conditions.

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