The New York state government’s lawsuit against Charter and its Time Warner Cable (TWC) subsidiary contains some intriguing details about how TWC allegedly manipulated speed tests conducted by the Federal Communications Commission.

The FCC uses measuring equipment in the homes of more than 4,000 Internet subscribers across the US to produce its annual Measuring Broadband America (MBA) report, which compares actual Internet speeds to the speeds promised by broadband providers. But TWC played a few tricks to get better marks than it should have in the tests, according to the lawsuit (full text) filed in the New York State Supreme Court by New York Attorney General Eric Schneiderman.

According to the lawsuit, TWC used one tactic that an employee described as “lipstick on a pig.” In another case, a TWC executive wrote an e-mail saying, “We just have to make it work temporarily” in order to boost the FCC speed test scores.

Schneiderman accused TWC of providing customers with older-generation cable modems that couldn’t produce the speeds customers paid for. This was a problem in the FCC’s testing, so in the summer of 2013, TWC assured the FCC that it would replace the deficient modems for all of its subscribers and would start by replacing the modems of those subscribers involved in the FCC panel. Based on this assurance, the FCC excluded poor results from its annual report.

But while TWC did replace the modems of FCC panelists and instructed customer service reps to give the panelists “VIP treatment,” the company at the same time “aggressively pushed [other] subscribers in New York to pay to upgrade their Internet service plans—without ever checking whether the modems it leased to subscribers were capable of actually supporting their new speed plans,” the lawsuit said. The FCC report based on 2013 data gave TWC high marks, but it included a note about the company's efforts to "encourage modem upgrades when needed."

Even when TWC customers had the latest equipment in their homes, they often didn’t receive promised speeds because the network wasn’t upgraded, the lawsuit also alleges. TWC used a few methods to hide the network’s poor performance in speed tests, Schneiderman claims.

In June 2013, TWC's then-head of strategy wrote in an e-mail that “Our [FCC speed test] scores are like watching a slow-motion train wreck. We need to get in front of this.”

At the time, TWC was involved in a dispute with Cogent, a middle-mile network provider that carried traffic for Netflix and other customers. Cogent was refusing to pay TWC for direct network connections, arguing that the companies should continue exchanging traffic without money changing hands, with each company “bearing its own very small expense ($10,000 for a 10Gbps port) of adding capacity.” With the companies at a stalemate, TWC refused to upgrade ports, and there wasn’t enough bandwidth to reliably serve customers.

“One thing I think we may need to be prepared to do is just give more ports to Cogent during sweeps month [when FCC results are measured for purposes of the MBA report],” the TWC strategy executive wrote in the June 2013 e-mail, according to the lawsuit. “We don’t have to make any promises, we just have to make it work temporarily.”

The Cogent/TWC dispute was resolved in October 2015, a few months after the FCC issued net neutrality rules that required companies like TWC to provide interconnection at “just and reasonable” rates.

Schneiderman's office drew on three sources of data to conclude that TWC customers were "dramatically short-changed on both speed and reliability." The data included FCC tests, Speedtest.net results, and consumer tests arranged by the state itself. "Subscribers on the 300Mbps plan generally received only 10 percent to 70 percent of the promised speed; subscribers on the 200Mbps plan received only 14 percent to 60 percent of the promised speed; and subscribers on the 100 Mbps plan received only 24 percent to 87 percent of the promised speed," the lawsuit said.

Sam deceived

The FCC’s tests were administered by Sam Knows, a federal contractor who measured speeds with a “whitebox” device that attached to customers’ modems and automatically ran speed tests when the modems weren’t being used. TWC allegedly ran a parallel system that helped it identify bad test results before the FCC finalized its research.

“In 2016, approximately 800 subscribers spread throughout different service groups across the country comprised Spectrum-TWC’s FCC panel,” the lawsuit said. (Spectrum is a brand name used by Charter.) “Spectrum-TWC independently contracted with Sam Knows to install a parallel, internal panel of whiteboxes in Spectrum-TWC network centers and the homes of Spectrum-TWC employees across the country to conduct network diagnostics and anticipate any concerns raised by results from the FCC Panel. In 2016, Spectrum-TWC had about 1,200 such whiteboxes distributed across different service groups in its network nationwide.” (A service group is essentially a neighborhood that shares a set amount of bandwidth from TWC cable lines.)

TWC allegedly made sure that FCC panelists received speeds not available to many other subscribers. (DSLReports also has a good summary of the speed test allegations.)

TWC “deceived the FCC by manipulating the average Internet speed results in the FCC’s speed tests,” the lawsuit said. “The company inflated the average speed results by providing increased Internet speeds when service groups were less utilized to offset (and conceal) test results showing slower speeds when the service groups had heavier usage. By gaming the FCC speed tests in this manner, Spectrum-TWC concealed the fact that it failed to consistently deliver the promised speeds to its subscribers under actual network conditions.”

Essentially, TWC was “giving panelists the ability, at times, to report higher-than-advertised speeds (‘overprovisioning’) to conceal the fact that most subscribers, particularly those on congested service groups, received far less than their promised speed,” the lawsuit said.

TWC's former head of corporate strategy (the same one who wrote "we just have to make it work temporarily"), wrote the following in another internal e-mail on July 7, 2014: “We recommend increasing over-provisioning our modem speeds to around 20% to drive our Sam Knows scores > 100 percent.”

This would provide panelists with speeds faster than the advertised speeds. But the strategy was not viewed favorably by all TWC employees. “A 2013 Spectrum-TWC engineering presentation, which predated the decision to overprovision speeds by 20 percent, bluntly characterized the overprovisioning maneuver as putting ‘lipstick on a pig,’” the lawsuit said.

Charter, which purchased TWC last year, yesterday criticized the Schneiderman lawsuit “regarding Time Warner Cable’s broadband speed advertisements that occurred prior to Charter’s merger.” Charter said it is upgrading the TWC systems and will “defend against these allegations involving Time Warner Cable practices."

New York's lawsuit asks for a judgment directing Charter to pay civil fines of $5,000 for each violation and to provide refunds to customers by "disgorg[ing] all monies resulting from the fraudulent and illegal practices."

Disclosure: The Advance/Newhouse Partnership, which owns about 13 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.